Quote:
Originally Posted by Buckeye
So here's the situation, Free Trade vs what?
Something else?
I didn't even study this stuff that much!
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Say that in a free trade market, Americans are buying more goods from Chinese companies than Chinese are buying from American companies. If you don't think that is "fair", and if you have the power to do something about it, the quickest "solution" is tariffs.
A tariff on Chinese imports is a federally imposed tax on imports, and is paid by American importers who pass the cost on to American consumers who buy those imports. If the prices of Chinese imports increase relative to similar American products, American consumers will buy fewer imports and more domestic goods. The higher the tariffs, the more consumers that will switch away from imports.
The more that American consumers are paying in import taxes or for more expensive domestic goods, the higher their cost of living.