International Business
the economic impact of
free trade in the United States
Heather Biller
march 24, 2014
Introduction
Are the American policies supportive of her ability to return to the former days of glory following this most recent global economic crisis? This paper will study the U.S. economic history and assert that the current policies will prevent America from rebounding from the economic collapse, as it did from the American Revolution, the Civil War, WWI, the Great Depression, and WWII.
The United States (U.S.) has abandoned the former protectionist international trade policies which established it as a strong industrial nation and world leader, by using tariffs to fund government expenses to support a strong domestic manufacturing industry. It has adopted globalisation and free trade, while adding the yoke of income taxes, payroll taxes, and foreign financing. The critical failures arise from loss of jobs to emerging markets, high unemployment, and expensive health and social programs which are relying on internal taxation and excessive borrowing. Wealth cannot be recreated from the critical building block of industrialization as it has been drastically reduced, so stagnation will persist until new inventions are realized or policy amendments are endorsed.
This nation was formed by a few brave men and woman who desired to establish a nation based on liberty for all, and this notion was carved out in the Constitution of the United States of America. The founding fathers wanted a strong independent government apart from the sovereign rule of Great Britain. To establish this system, they sought to change the colonies from agrarian to a highly industrialized nation with a strong government and banking system that utilized tariffs to cover the costs. This was not a new concept for obtaining world leadership for it was Great Britain’s same model, and these governmental policies were just as effective in establishing America as the new world leader.
The United States (U.S.) has abandoned the former protectionist international trade policies which established it as a strong industrial nation and world leader, by using tariffs to fund government expenses to support a strong domestic manufacturing industry. It has adopted globalisation and free trade, while adding the yoke of income taxes, payroll taxes, and foreign financing. The critical failures arise from loss of jobs to emerging markets, high unemployment, and expensive health and social programs which are relying on internal taxation and excessive borrowing. Wealth cannot be recreated from the critical building block of industrialization as it has been drastically reduced, so stagnation will persist until new inventions are realized or policy amendments are endorsed.
This nation was formed by a few brave men and woman who desired to establish a nation based on liberty for all, and this notion was carved out in the Constitution of the United States of America. The founding fathers wanted a strong independent government apart from the sovereign rule of Great Britain. To establish this system, they sought to change the colonies from agrarian to a highly industrialized nation with a strong government and banking system that utilized tariffs to cover the costs. This was not a new concept for obtaining world leadership for it was Great Britain’s same model, and these governmental policies were just as effective in establishing America as the new world leader.