How to Save America’s Economy


Years of unfair trade and poor policy have torn apart the manufacturing base that once made the American economy strong. However, America was not always a slave to these disastrous free trade ideals.

For much of America’s history, our government took its Constitutional power to regulate commerce with foreign nations seriously. Tariffs were the major source of income for the Federal government. More importantly, though, they helped to protect America’s industries from foreign competition and allowed America to become the world’s most productive nation.

Unfortunately, in the 20th century protectionism began to take on a negative connotation in the United States, and the tariff was cast aside as a tool to regulate trade. But after years of lost American jobs and markets flooded with cheap foreign goods, many are calling for a reexamination of the practice.

Ian Fletcher, Senior Economist at the Coalition for a Prosperous America, has stated that “[a] flat tariff would be imperfect, but it would be infinitely better than free trade and relatively politics-proof.” Others have advocated more strategically placed tariffs on countries or imported goods that are most likely to hurt American industries.

The United States has rarely used tariffs in recent years, but when they have been implemented there is evidence that they do deter imports. In January 2005 the Commerce Department implemented tariffs to stop the dumping of bedroom furniture from China into the U.S. market. In 2004, before tariffs went into effect, China exported $1.2 billion worth of bedroom furniture to the United States. The figure in 2010 with the tariffs in place stood at just $691 million.

But such narrow and sporadic implementation cannot be as effective as wider use, and it will not be enough to rebuild a strong American economy. As the tariff was only implemented on China, other nations have picked up the slack and have sent scores of cheap bedroom furniture into the U.S. instead. Vietnam’s exports rose from $151 million to $931 million during the same period. This is evidence not that tariffs do not work, but that the U.S. needs to use its power to implement them in a comprehensive way in order for them to be as effective as they once were.

The United States needs to protect its industries and use all the tools at its disposal to do so. The methods that once built America into the world’s most productive nation should not be neglected today.

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