International Trade

International Trade

Impacts Of U.S. Trade Policy Changes on Multinational Corporations Global Trade Activities

U.S. trade policies and aims have impacted world trade activities. Firstly, it has improved business by ensuring a massive decrease in disposing of goods in different countries. The United States, on the same line, has confirmed that countries participate in fair trade that will see development and positive effects on their economy (Schlegel, 2020). As a result, many entities and industries have improved, including the country’s story differently. Moreover, the growth of multinational corporations has ensured continuous trade with every country worldwide. The mentioned has confirmed that there is growth in the world market. Thus, work has developed to be stable in all sectors.

The trade policies have ensured increased accountability and transparency where countries can participate in fair trade. The mentioned provides that multinational corporations create morals that allow more and more countries to work without fear as the work is open and honest (Schlegel, 2020). Additionally, there is the implementation of trade commitments for multinational corporations since the trade-based system they engage in is pliable enough to strengthen a decrease in any investment barriers before the policies were passed and actualized. For instance, import tariffs have affected multinational corporations such as Walmart.

Economists’ Opinions on The Long-Term Effects of Recent Trade and Tariff Policies Changes

Economists agree that long trade barricades such as tariff policies have been seen to deck some economic difficulties rather than benefits. A fact is that tariff policy raises the costs and decreases the availability of products and services, resulting in less income, employment, and economic production in a country. Furthermore, tariffs increase the prices of products for export or import (Chatterjee & Chatterjee, 2021). Taxation causes an increase in a government’s price policy and decreases trade, resulting in a trade deficit. Furthermore, it reduces the number of goods imported and the number of products exported. Further, it increases domestic production and customers’ prices.

David Ricardo argues about the principle of political economy and taxation in that tariffs impact consumers paying higher for goods they are supposed to, thus making them trade at home or elsewhere. Though taxes can manage a lot of long-term securities for household industries that manufacture the goods as defensive opposition, they do get expenses from other economies, counting on consumers and other producing companies (Chatterjee & Chatterjee, 2021). The main focal point for every economist is mentioned in the trade policies. Since trade agreements are formulated for liberal trade, other approaches are set to seek the domestic and international realities of goods. U.S. application of tariffs to every goodwill does not do good as it will decrease the economic output, employment, and income.

Effect Of Recent Changes to Trade and Tariff Policies

Changes in the trade and tariff policies have had a significant effect on every individual at every level. For example, my employer has been hugely affected. My employer is an importing company that supplies electrical gadgets from China. Since the direct war on trade policies between the United States and China, the company has had various difficult times that have reduced production and development. The mentioned has caused the prices of multiple gadgets to increase, thus restricting the number of appliances imported from China. With that said, it has been seen that the company will reduce in terms of made and profits made. The increased duty and taxes on products, specifically from China, have caused the prices of goods to go extremely high.

Nonetheless, the company must endure the tough times as trade must continue. In addition, the company has lost a lot of customers who made the company great profit before. Due to the high cost of importing goods, the company has to increase the selling price to gain some profits. Thus, in addition to getting few products, the customers are running away from the high prices. I have felt the change in trade tariffs and policies. My boss has had to reduce my salary since the times have been harsh. The decrease in my income has affected me in that I cannot meet all my expenses like I used to do before the war. I must depend on my parents for additional support to meet all my expenses. Over time, I have had to cut some costs on things I used to do before, such as regularly visiting fast food restaurants or going to the movies. My concentration has been put on basic needs and fewer recreational activities that will cost me less.

Besides, my neighbor has been affected by the firm policies on trade in the past few years. She used to work in a specific company, and due to the rise in tariffs, her employer fired everyone and closed the company. The effect has affected her because getting another job has been hard. Therefore, it is vital for those making policies to understand the impact the tariffs have had on the nation and individuals in general. Leaders should shun away from fights and revenge and use tactics that will cost innocent individuals who rely on their jobs for a living.

References

Chatterjee, N., & Chatterjee, T. (2021). Tariff War, Unemployment Rate, and Welfare. In Global Tariff War: Economic, Political and Social Implications. Emerald Publishing Limited.

Schlegel, C. (2020). Tariffs, NATO and Nord Stream: Is Trump the Problem to a Transatlantic Free Trade Agreement? Zeitschrift für Außen-und Sicherheitspolitik, 13(1), 65-81.

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Promoting international trade is not a zero-sum game. It is a win-win proposition; both parties gain from work.

Consider the following:

Tariffs are paid by the citizens of the country imposing tariffs, not by the country’s citizens producing the products upon which the taxes are levied.
The term “trade deficits” is a misnomer. Every country’s trade is always in balance.
Trade deficits do not mean the U.S. no longer produces anything to export. The US is the world’s second-largest manufacturer and the world’s second-largest exporter of manufactured goods.
Trade deficits reflect a strong economy. Trade deficits rise during economic expansions and fall during economic contractions. Unemployment falls as trade deficits rise and rise as trade deficits fall.
Imports and exports are complements, not competitors. Both are necessary, and both contribute to economic growth.
Roughly one-third of all U.S. imports and exports are traded between U.S. multinational companies and overseas subsidiaries.
Foreign-owned companies in the U.S. number in the thousands and provide jobs directly or indirectly for more than 13 million U.S. workers (roughly 10% of the U.S. workforce).
The U.S. trade deficit in goods in 2018 (as a % of GDP) was the same as 5, 10, and 15 years earlier.
The rise in the U.S. goods trade deficit with China has not increased the U.S. total goods trade deficit. Reduced goods imports from other trading partners have offset it.
There is a strong correlation between the rise in world trade and:
The increase in world GDP
The dramatic fall in the world’s extreme poverty rate
The surge in world life expectancy
For every U.S. manufacturing job lost to trade between 2000 and 2010, seven U.S. jobs were lost to domestic productivity improvements. Those seven jobs cannot be returned from overseas because they never left the U.S.

Write a 700- to 1,050-word evaluation of credible economists’ unbiased opinions on the benefits, costs, and results of current U.S. trade and tariff policies. Complete the following in your assessment:

Evaluate how U.S. trade policy changes in the last two years affect global trade activities by multinational corporations.
Discuss credible economists’ opinions on the long-term effects of trade and tariff policy changes in the last two years.
Explain the effect that recent changes to trade and tariff policies have had on your employer, you, or someone you know.

Cite at least two academically credible sources.