The Significance of Trade Tariffs - Paper Example

In the millennial era, international trade between various countries plays an essential role in raising the living standards, establishing employment opportunities, and enabling clients to enjoy a variety of services as well as products. In multilateral trade, the importance of tariffs has declined, even with its substantial benefit of policy-initiated structure to promote or restrict import and export costs. The decline of tariffs has given rise to trade-related transaction costs, for example, logistics and freight costs, customs administrative fees, and border costs. Moreover, nations such as the United States, under the leadership of President Donald Trump has reflected on the need to impose new tariffs or amend old ones as a means of gaining control over trade and minimizing foreign nations' influence over its resources. The paper aims to compare and contrast Rappeport's literature titled "Trump's stalled trade agenda leaves industries in the lurch" published on August 07, 2017, with Swanson and Vogel's article titled "Trump's tariff set off a storm of lobbying" posted on 16, 2018. Therefore, even with the fact that imposing new tariffs or modifying old ones promotes a winning or losing situation for either trade parties, the paper highlights the importance of trade tariffs to the United States of America in both articles.

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According to Rappperport, the United State population has lost its trust in the nation's administration structure (1). For example, the approach President Trump took by withdrawing from the Trans-Pacific partnership has led to the failure of his promise of winning on trade (1-2). The problem the business sector perceives is the struggling efforts of the government on working through complex policies that assist the nation in dictating international trade. Also, Swanson and Vogel establish measures of imposed tariffs imposed by President Trump on the steel (3). In a review on meeting between top oil and gas executives at the Trump International in Washington, these esteemed personalities identified the steel tariffs impose by Trump would increase the cost of pipelines and extraction plans all over the nation (Swanson and Vogel 3). Ideally, these were complaints made by U.S. steel industries, stating that imposed tariffs on the steel industry would interfere with the standards of international trade. Trump's administration responded to the complaints made by the industry was based on the elements of protecting the U.S. national security and reducing its trade deficits. In a theoretical perspective, with the existence of the trade war between China and America, the U.S. has proposed a bilateral trade which is more straightforward to control than multilateral. Also, it is easier to manage, and the nation likely to benefit from the business (Krugman 2).

The decision made by the United States on amending and imposing new trade tariffs was aimed at protecting its domestic market from foreign investors. It was done by consciously selecting products and excluding some products and services that are readily available in the market. According to Swanson and Vogel, the United States top trade analyst and negotiator Robert Lighthizer was given the task of deciding which nations that were to be excluded in the bilateral trade, while Wilbur Ross, the business sectary, tasked with the procedure of eliminating imports of various commodities and services that were widely available to the U.S domestic market (8).

Also, Rappeport promoted U.S idea of selecting its allies and neighboring nations such as Mexico, Canada and Australia and develop a bilateral trade system. The trading system was to rely on U.S. trade tariffs, which were to be used to govern interest of America, by ensuring the partners do what the U.S. expects them to do (11). In other terms, Mr. Trump believed that the United States could use trade as leverage to force partner-countries do activities America needed them to do and use business as a bargaining tool. Ideally, Swanson, Vogel and Rappeport agree to the fact that President Trump's administration imposed trade tariffs to support and protect its domestic market by hiking the taxes.

Also, after imposing trade tariffs, different institutions and sectors have involved trade lawyers and lobbyists in trying to negotiate on the exemptions and inclusion of foreign nations companies, and partners. According to Rappeport, trade tariffs have brought about the high level of seriousness in the commercial sector where not only do states, organization, and non-governmental organization seek foreign economic assistance from any country, but they use legal approach to negotiate trade agreements with the investors as per the U.S. policies (30). For example, the U.S. construction industry selected a lobby team that requested the Trump administration to enter into a new deal with Canada on lumber since it affected the industry by promoting high levels of unemployment and increased import rates for the products.

On the other hand, Swanson and Vogel highlighted that a group of lawyers and lobbyists offered their services on securing exclusion and exemptions for international nations as well as enterprises (10). Each group suggested on different prospects that could aid in reducing the trade tariffs. For example, the American Petroleum Institute indicated that high tariffs on steel would affect the petroleum and gas free trade due to the importance of steel to the sector (Swanson & Vogel 12-13). In a nutshell, the Trump administration is using trade tariffs to restore the superiority of the U.S. in the international commercial sector.

Additionally, the two articles highlighted in the first paragraph covered the same event, the impact of trade in the U.S commercial sector. Also, there is one better way of ensuring that the public understands the position of the nation in regards to trade tariffs. First, these articles cover the same topic, and there are no differences in the message conveyed. Second, Krugman stated that the imposing of trade tariffs as per Trump's approach was a misconception since he did not take the right attitude on the trade policy (2). Such a comment portrays the elements of confusion while reading the two articles presented in the first paragraph. To make the articles more understandable, the authors needed to identify what bilateral and multilateral trade system. Moreover, both pieces needed to highlight positive or adverse consequences in case trade tariffs were imposed on the two trade systems.

To conclude, the trade tariffs imposed by the U.S. of imports were to establish a reliable and functioning domestic market. Its main agenda was to ensure that some foreign nations, as well as companies, were excluded, especially if the import products were readily available in the U.S. domestic market. Also, the trade tariffs were an approach of introducing a bilateral trade system, which the Trump administration saw as easy to manage since the nation would impose tariffs that would be of great benefit to its economic growth. Lastly, since there are no differences between the original articles highlighted in paragraph one the only means of ensuring absolute understanding of the context is by explaining how bilateral and multilateral business structures function and what the U.S. will gain if tariffs are implemented on either of the two.

Works Cited

Krugman, Paul. Killing the Pax-Americana: Trump's trade war is about more than economics. 11 May 2019. <https://www.nytimes.com/2019/05/11/opinion/killing-the-pax-americana.html?searchResultPosition=8> Accessed on 22 July 2019.

Rappeport, Alan. Trump's stalled trade agenda leaves industries in the lurch. 7 August 2017. <https://www.nytimes.com/2017/08/07/us/politics/trumps-stalled-trade-agenda-leaves-industries-in-a-lurch.html?searchResultPosition=10> Accessed on 22 July 2019.

Swanson, Ana and K. P. Vogel. Trump's tariffs set off a storm of lobbying. 16 March 2018. <https://www.nytimes.com/2018/03/16/us/politics/trump-tariffs-lobbying.html?searchResultPosition=2> Accessed on 22 July 2019.