Donald Trump rails against China, Japan, Mexico and other countries – the United States is put in trading, the take away Americans jobs. Customs duties are intended to remedy the situation. Harm band wood, economist at Unicredit Bank in New York: The Problem of the United States were not about to high imports but low exports. The introduction of customs duties will not solve the Problem, but rather worsen.
firstly, it is wrong, the decline in employment in industry to globalisation. A major factor in the increase of the productivity is simple: Because the American industry production had declined since the beginning of the Nineties, but more than 70 percent. And, although working time and employment had decreased by 30 percent.
America is a high-cost country
The loss of importance of the Manufacturing industry is economies in enriching people’s also completely normal. The richer a country, the lower the proportion of industrial production in the gross domestic product. And this is true not only for the United States or Germany, but also Japan, China, and Mexico, which benefited by, supposedly, the relocation of American production.
of Course, the globalization have made a contribution, especially China’s accession to the world trade organization in 2001. However, the relocation of jobs is less unfair trading practices costs owed as simply the wage benefits in a country with a lesser. The United States would have to recognize that you are a high-cost could be the country, and on this Basis, never with Mexico or China to compete.
America imports little and exports even less
Instead, the country needed to strengthen its competitiveness. Because the Problem in America are not about to high imports. On the contrary, the share of imports in the gross domestic product was four percentage points lower than in the Euro area and also in China. Japan imported more than the United States. A lot more the country had a export problem. Because the share of American exports is around 12 percentage points below the Euro-area and China, and is still six percentage points below that of Japan.
This export weakness of the import duties, but to remedy by no means. On the contrary, the duties are more likely to aggravate the problems of the country. To be expected against the measures, but the protection of domestic production through tariffs will lead to the rationalization and innovation pressure decreases and the domestic products on world markets even less competition would be capable of.
Trumps voters to pay the Piper
in Addition, the duties were just to the detriment of the workers. Because of this, should in future pay more for the protected products – on the one hand because of the more expensive foreign products, on the other, because the domestic producers could charge higher prices. Because of the cheaper, foreign competition in the way of the event then Yes. In the end, earning only two duties: the American producers and the state, which collects the tariff revenue.
America is served, therefore, more expenditure on research and development, education and infrastructure than with import duties. Training, but also more financial support for the losers of the technological development and the globalisation is considerably more expedient than the rebuilding of trade barriers.