- We, the undersigned, have serious concerns about the recent protectionist sentiments coming from Congress, especially with regards to China.
By the end of this year, China will most likely be the United States' second largest trading partner. Over the past six years, total trade between the two countries has soared, growing from $116 billion in 2000 to almost $343 billion in 2006. That's an average growth rate of almost 20% a year.
This marvelous growth has led to more affordable goods, higher productivity, strong job growth, and a higher standard of living for both countries. These economic benefits were made possible in large part because both China and the United States embraced freer trade.
As economists, we understand the vital and beneficial role that free trade plays in the world economy. Conversely, we believe that barriers to free trade destroy wealth and benefit no one in the long run. Because of these fundamental economic principles, we sign this letter to advise Congress against imposing retaliatory trade measures against China.
There is no foundation in economics that supports punitive tariffs. China currently supplies American consumers with inexpensive goods and low-interest rate loans. Retaliatory tariffs on China are tantamount to taxing ourselves as a punishment. Worse, such a move will likely encourage China to impose its own tariffs, increasing the possibility of a futile and harmful trade war. American consumers and businesses would pay the price for this senseless war through higher prices, worse jobs, and reduced economic growth.
We urge Congress to discard any plans for increased protectionism, and instead urge lawmakers to work towards fostering stronger global economic ties through free trade.
2 comments:
Your comments do not take into consideration the working person. You want your text book definitions to allow people in the State of Michigan to suffer in retrieving the necessities of life. Every manufacturing company in the world will go to China; and the sucking sound you hear from China and Mexico and other Central American countries will be our jobs being sucked down there (Ross Perot, 1992).
As I understand it, there was an act called the Trade Adjustment Act (TAA) that was suppose to provide funds for workers whose work was taken away by the so called "free traders". It was never implemented. Who is looking out for these folks? An insensitive government bureauocracy that could care less about them; just like college professors and corporate boards. How does a worker make do for his family.
I know nothing about blogging. It is my hope that you get what I have printed. It seems to me that the James Madison Social Problems and Public Policy would work as hard toward helping the poor folks as they do in protecting corporations and hedge fund operators. Personally I don't see this happening. Show me that I am wrong. John Willson
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