International Trade

New Resources on International Trade

Americans – whether they are consumers, manufacturers or farmers – benefit from robust international trade. The overwhelming majority of firms that export are small to medium-sized businesses and one-third of the acreage planted in the United States will yield crops that find their way to overseas markets. International trade supports 41 million jobs of which six million are manufacturing jobs. The U.S. Chamber of Commerce has created a map that displays the state by state impact of international commerce providing statistics on the number of jobs that owe their existence to trade including employment resulting from foreign direct investment, the number of companies that sell goods overseas and revenues resulting from exports. Access the map to see how trade affects your state here.

Given trade’s outsize positive influence on U.S. economic growth, policies that inhibit America’s trading posture have the potential to harm our economy. Unfortunately, the United States is at the threshold of a trade war that threatens to blunt the positive economic policies advanced by the current Administration. Bringing corporate tax rates into line with the rest of the globe and reducing the regulatory burden for industry encourage investment in America, however, the tariffs proposed and adopted by the Administration have undermined these positive, pro-growth policies. While much attention has focused on steel jobs “saved” and “created”, a quiet crisis is taking place with downstream industries. Christine McDaniel and Veronique de Rugy of the Mercatus Center of George Mason University recently published an excellent report that details the damage that trade “remedies” such as tariffs, import taxes, antidumping, countervailing duties, and safeguards have on the downstream industries. Their report The Downstream Costs of Trade Remedy Regulations concludes that when determining the effectiveness of trade remedies, the U.S. International Trade Commission needs to be able to consider the impact on downstream industries. As McDaniel and de Rugy observe, “laws intended to remedy unfair competition in one sector can end up causing disproportionately large costs to downstream sectors.” Access the study here.

In light of trade policy that appears to be charting an economically perilous course, both of these resources are most welcome precisely because they provide a more nuanced portrait of protectionism’s impact. Just last week the Administration announced its intent to levy tariffs on another $200 billion of imports from China. These tariffs fall disproportionately on the goods that hardworking American families purchase every day such as fresh produce, apparel, and appliances. These reports highlight the impact of misguided trade policy on the states and underscore that because of international commerce’s complexity, policies that are not carefully developed often have highly problematic unintended consequences.

In Depth: International Trade

International trade creates and supports millions of American jobs that offer higher than average wages and drive economic growth. As a testament to the strength of American entrepreneurship, the vast majority of U.S. exporters are not large corporations but small to medium-sized enterprises. Those that doubt the power of global…

+ International Trade In Depth