Daniel Ikenson - Reducing or Eliminating Duties on Imports - Review

I agree with Daniel Ikenson regarding reducing or eliminating duties on imports will boost the competitiveness of domestic produced product not only in our market but also internationally. Most countries impose import tariffs to protect domestic producers from international competition and of course increase government revenue. When tariff is being imposed, the cost of the product is also increased by sellers and in that case, consumers pay more prices for the product in the market. When tax is being imposed on import products, seller increases the market price of the product because one of their biggest costs is import tariff. For example, According to Ikenson, a price tag of the imposed tariff tax product was about $15 billion higher than free trade. That clearly means that American consumers paid about $15 billion extra money to purchase those products.

Free trade is defined when tariff is not being imposed. Free trade benefits domestic (American) consumers with lower prices and a wider choice of products as there will not be any tax applied to import products. The free market system can provide more jobs and higher wages. One of the best ways to promote growth is that the Government should encourage business by low taxes, minimal regulations and free trade. The sustained growth will generate new jobs and higher wages. The free market can provide a higher standard of living. With minimal government intervention, our economy can be best. Free trade or reduction in trade will create more jobs because by lowering trade barriers to our goods, we can increase our exports to other countries, which will increase the overall sales and profits to our companies in America. In that case, American companies will hire more workers. Not to forget that free trade can move some of the jobs internationally, however, it will create new jobs and new industries in our country. Even though, free trade will create some jobs internationally but our goal is to create new or more jobs in America.

An Antidumping occurs when manufactures export their product to another country at a lower price than the market price in their own market (domestic market). In another words, foreign companies are selling their product at less than fair value. The antidumping law penalizes foreign manufacturers for accusing of injuring exporting country. For example, in 2003, the annual import of wooden furniture by the United States has been two billion dollars from China (Wan, 2010). Government took action against china for the trend of antidumping because this trend was eliminating American jobs which caused unemployment to increase. Therefore, since January 2005, antidumping duties of 0.83% to 198.08% were imposed on Chinese firms as the antidumping has been negative impact for United States. Since the government has been increasing more taxes on antidumping, America is recovering the loss from the antidumping in past.

However, antidumping

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