| First let's see what protectionism is. According to Mr. | | | | that automatically penalizes the mass of consumers? |
| Webster it is the advocacy, system, or theory of | | | | Examine the definition of tariff again and think it |
| protecting domestic producers by impeding or limiting, | | | | through to the end. A tariff is a tax on consumers. |
| as by tariffs or quotas, the importation of foreign | | | | You are paying more for certain goods (and there |
| goods and services. | | | | are about 13,000 separate tariffs) than you should |
| That sounds pretty good. It is something that will | | | | just for the benefit of a few manufacturers who |
| protect the jobs of our workers from goods that | | | | cannot compete in the world market. Every country |
| can be produced elsewhere and undercut the prices | | | | is not just a unit unto itself any more. We now have |
| of our local goods. How? There are a couple of | | | | a global economy that allows specialization of |
| ways. The merchandise or commodity itself is in very | | | | products. If a company cannot compete it should not |
| large supply in another country and is mined or grown | | | | be in business and should not penalize the majority of |
| there very cheaply. Not much you can do about that. | | | | its citizens for the benefit of a few. |
| Or the labor costs of production are vastly less than | | | | You, the consumer, should not have to pay more for |
| our own workers and the product can be | | | | tomatoes, brassieres and steel just so our politicians |
| manufactured for less. | | | | can get reelected. That is what is boils down to. |
| The average worker in the U.S. makes about $12.00 | | | | Unions will promise to back certain candidates if they |
| per hour while the workers in Mexico get $2.00 and | | | | will vote for tariffs (tax increases) that protect |
| the people in China average 60 cents per hour. How | | | | incompetent manufacturers. The steel tariff is an |
| do you compete with them? Answer - you can't. So | | | | excellent example. Bush put on a tariff when he could |
| what do you do? If you are a shoe manufacturer in | | | | have given a tax break to help modernize that |
| the U.S. you ask the federal government to levy a | | | | industry. In the long run our steel production will |
| tariff (tax) on all imported shoes (or maybe just the | | | | disappear because of continuing inefficiency. |
| kind you make). This sure helps that particular | | | | If we get into a trade war where one country |
| shoemaker who might have 300 employees making | | | | trumps another with more and more tariffs it is a |
| sneakers. Now the sneaker maker can keep his | | | | guaranteed loser for everyone. Visualize this as |
| prices up and his workers working. That's good. | | | | building a house of cards. You end up with a game of |
| But wait a minute. There are millions of feet that | | | | 52-pickup. It could go to the ultimate of deflation and |
| need sneakers and that means millions of consumers | | | | depressions for all the countries of the world. |
| are paying more for comparable quality sneakers. Is it | | | | Protectionism in all of history has never worked. |
| fair to give special consideration to a very small group | | | | |