Discussion Post - "The Economy Has Me Tariff-ied!"

DISCUSSION PROMPT This week we began learning about the difference between politics, government and democracy. Moreover, we uncovered several of the core functions of a government, one of them being to ensure safety and order for its citizens. During the 2024 presidential election campaign, the state of the U.S. economy was a focal point for both Kamala Harris and Donald Trump. Economic concerns, including inflation and trade deficits, dominated the discourse, with both candidates offering contrasting solutions to try and reassure the American people that the government could correct the countries financial woes. Notably, President Trump following his electoral victory, pledged to impose a 10% tariff on all Chinese goods and a 25% tariff on all imports from Mexico and Canada as a mechanism to provide for the economic security of the country. A tariff is a tax or duty levied by a government on imported goods and services. However, these taxes are not paid by the exporting country; instead, they are borne by the domestic companies importing the goods. For instance, if a retailer like Forever 21 imports clothing from textile factories in China's Guangdong province, the company—not the Chinese government—is responsible for covering the tariff. As a result, tariffs generally raise the cost of imported goods. The trade off is that tariffs can potentially encourage domestic production or shift consumer preferences toward locally produced alternatives. So in theory, tariffs can serve dual purposes: they generate revenue for the government and create an incentive for domestic production. Revenue from tariffs could be used to fund public programs or subsidize industries such as agriculture, potentially lowering costs for American consumers. President Trump likely envisioned a similar outcome, suggesting that tariffs on imports could bolster domestic industries and reduce reliance on foreign goods. For example, revenue from tariffs on Chinese imports could be redirected to support U.S. farmers, lowering the cost of fresh produce and dairy products here in the States. (https://youtube(dot)com/shorts/0So4wTg2i7o?si=BdenznvVXlIXmAOTLinks to an external site.) There is often some additional complexity that political economists address when considering a tariff. According to data from the U.S. Census Bureau, Americans spend over $1 trillion annually on goods from China, Mexico, and Canada. (https://www(dot)census(dot)gov/foreign-trade/statistics/highlights/toppartners.htmlLinks to an external site.) Imposing steep tariffs on these imports would almost certainly raise costs for businesses, who generally then pass these increased expenses onto consumers in the form of higher prices. This scenario risks exacerbating inflation and reducing household purchasing power, particularly for low-and middle-income families, individuals living in rural areas and mid-western states, and other marginalized groups living in states like California, New York and Florida, that already have high property, and/or sale and income taxes. Historically, tariffs have proven to be a double-edged sword. During the 1930s in the midst of the Great Depression, the United States House of Representatives passed the Smoot-Hawley Tariff Act (SHTA) which sought to stimulate domestic purchasing and protect American farmers and manufacturers by imposing high tariffs on over 20,000 imported goods. Instead the SHTA triggered retaliatory tariffs from other nations, resulting in a dramatic decline in international trade. U.S. exports dropped by more than 61%, devastating industries reliant on foreign markets. Instead of alleviating the effects of the Great Depression, the SHTA deepened the crisis by increasing costs, driving up inflation, reducing global trade, and further weakened the U.S. economy. Given the historical and economic context, President Trump’s proposed tariffs raise critical questions about their potential impact. Could such measures genuinely address the country’s economic struggles, or might they inadvertently harm consumers and businesses? Considering the concerns raised by political economists across the ideological spectrum, do you believe that voters supporting Donald Trump fully understood the potential implications of his proposal? Moreover if voters didn't quite understand the implications of a tariff why do you think they vociferously supported the idea? As you reflect on these issues, consider the balance between short-term economic gains and long-term consequences. Can tariffs be an effective tool for economic recovery, or do they risk repeating historical mistakes? Why or Why not? RESPONSE INDICATIONS AND GRADING Discussion response grades are based on the following areas: (5pts) Structure - (1) Responses must be a minimum of 250 words, (2) includes proper citations as applicable (MLA format), (3) does not contain any use of AI, or plagiarized work from other authors (including other students). Any discovered use of AI or plagiarized work will result in a "0" for the assignment and referral to the Dean of Student Affairs. (13pts) Analysis / Depth of Understanding - Demonstrated ability to discuss the topic, respond to the prompt questions, include analysis, reference applicable contemporary issues and demonstrate a depth of understanding regarding the intersection of the topic with concepts discussed in this unit or in class, reading, and gleaned from the students own understanding from outside content, current events, and/or additional reading materials (7pts) Quality of Engagement - (1) student must respond to at least two other students in class, (2) response should expand upon a presented idea, challenge a position, and/or provide a inquiry into a position offered by their classmate; (3) responses that merely state "good job", "I like what you said...", "I agree" or any similar response, will be considered insufficient and be ineligible for the maximum possible points.