Buy American. Sounds good, right?
I have nothing against buying American products. But the sentiment behind this phrase is that it’s bad to buy something made in a foreign country. The people who usually utter this seem to think that buying from foreign businesses costs jobs or hurts our economy.
Nothing could be further from the truth. In fact, free trade is good for us. Trade between countries makes our economy strong. It is especially important to Arkansas’s economy.
According to the Business Roundtable, international trade supports 325,000 jobs. These jobs come not only from the $8.9 billion in Arkansas products sold overseas, but also from the lower prices that trade creates for consumers.
Even so, you won’t find a shortage of people looking to restrict free trade. If their attacks on trade succeed, it would create big problems. Here’s how economist Donald J. Boudreaux sums up what happens under protectionism:
However well intended, restrictions on foreign trade harm the very people they aim to protect: American consumers and producers. Trade restrictions limit the choices of what Americans can buy; they also drive up the prices of everything from clothing and groceries to the materials manufacturers use to make everyday products. Moreover, it is lower-income Americans who generally bear a disproportionate share of these costs.
The key to modern life is trade. No one can make his own clothes, grow his own food, or build his own shelter. Each one of us has specialized skills that we use at our jobs. We then use the money we receive from those jobs to buy products made by people who specialize in other jobs. The wider circle of people we have to buy from, the more benefits we get.
Think of all the benefits you experience on a daily – no, hourly – basis. The TV you watch, the computer or phone you are reading this on, the car you drive – all were made overseas or have parts that come from foreign countries. Or, at the more mundane level, do you really want to live in a world where you can’t buy bananas, Heineken Beer, or Cadbury Creme Eggs?
There’s nothing wrong with buying American, but let’s not think that there’s anything wrong with buying from Japan or China or Chile or France, either. Free trade is good. It enriches our lives. It creates jobs in Arkansas and the United States. It makes our economy strong. And, finally, it makes our world a better place.
P.S. Free trade is one of the “Three Big Ideas” that we’ll discuss at our forum at noon this Friday. Interesting speakers, big ideas, a free lunch: what more can you ask for? Click here to get more details and to register – we hope to see you on Friday!