Question

from welfare perspective to discussion U.S. Tariff on 2018. and what do you recommend? ?at least 120 words?

Answer 1

Solution

The present government in the U.S has been adopting protectionism measures.One of those is the recent imposition of Tariff.Most of the goods were those which are imported from China which include steel,aluminium,cars,etc.,.So China also retailiated by imposing tariffs on $50 billion worth of American goods including cars whiskey etc.,

The present government thinks that imposing tariffs is the only best way to curb unfair trade (in their view). In my view,I don't think that this strategy would be useful for neither of the countries.It is leading trade war like situation.I do not recommend this kind of strategy folllowed by the U.S

Trade is something that is bilateral i.e., is two-way.Sudden imposition of huge tariffs is taking a toll on it's trade relationships with different countries.For instance take the example of Steel.The previous governments have also taken this decision of tariff imposition but when after realizing it was doing little favour (in the form of creating new jobs in the sector) and more disdvantage (increased prices of the steel),they removed the tariffs.The U.S steel is 3 times costlier than Chinese steel which is the reason why it is importing it. Every country has a speciality in producing some goods and rendering some services.It cannot say that it will produce and provide all kinds of goods and services because in this process,the consumers are the ones who are suffering due to high prices.The governmenet is with insecure feeling that it is loosing on a particular sector which is not true.It cannot be of the view to excel in all the sectors.This view is kind of traditional and narrow mindedness.As the U.S is highly developed,its citizens are shifting from working in the low value activities to high value activities(like planes etc.,)

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