Whose Interests Should Be the Paramount Concern of Government Trade Policy - the Interests of Producers (businesses and Their Employees) or Those of Consumers?
Autor: sfield111 • March 21, 2012 • Essay • 329 Words (2 Pages) • 7,617 Views
The trade policy hurts the individual consumer more than the producers of businesses. American trade policies have regulations that limit the percentage of a product that must be made or portion of the product has to be made in the United States. This limits the competition of foreign countries which cause the price of products to increase on imported goods or parts. Now, these foreign components create higher prices and the result is consumers will have to pay more for the products. The producers win because they are getting more money for the higher price goods due to foreign competition.
Businesses win when it comes to trade because the government speaks for the producer and not as much for the consumer. Trade policies are implemented to help the producers or businesses by establishing tariffs to protect the competition from foreign companies. This causes prices to increase from these tariff restrictions. Goods produced in a foreign country have a reverse effect on producing goods efficiently by a domestic business when tariffs are involved. Imported items will cost more to the country receiving the goods and will cost less to the country exporting the goods. As the world is closing in due to computers and technology, it should lesser the tariff barriers in order to reduce prices consumers pay. An example would be if tariffs between Japan and the United States were lowered for automobiles, the cost to consumers in the U.S. would be more affordable.
The interest of trade policy should be more balanced between businesses and consumers. The economy is changing and the small businesses should be recognized as a growing segment while producing goods and services and helping the economy’s increasing revenue. The government should continue to enforce policies that will protect businesses so that worldwide firms are not taken advantage of but help the consumer with pricing goods so they are more inexpensive.