A historical fact that many American voters are not aware of – The last president who was a trade protectionist was Republican Herbert Hoover. If you know anything about American history, then you know that his views on foreign trade are believed to be one of the catalysts that threw the country, and the entire world, into a financial depression that lasted over ten years. The 2008 sub prime mortgage is peanuts compared to that mess.
Yet, we have a business mogul who has his eye on the Republican presidential candidacy who also has the same views on international trade relations that Hoover did, and someone needs to start handing out history books quick before Donald Trump has his way.
Not only is Trump full on anti-immigration – which does nothing but hurt growth and alienate ethnic voters – he is anti trade. Most recently, he has announced that if voted president, he would prohibit (that’s right, PROHIBIT) any American company from building plants in Mexico. So basically he is giving the Mexican people even more reason to need to immigrate to the US. He also moans that China is eating the US for lunch and sucking its blood like a tick.
What Trump, like Hoover, fail to realize is that open trade with foreign countries forces the US business to strive to be better. To work harder at creating better products. In a nutshell, it encourages competition, and competition in manufacturing is what helps to keep prices in check.
Take a product like the Japanese konjac sponge or any other beauty product as an example. If Trump were to cease to allow imports of the konjac, then American companies who distribute it would be able to create a monopoly on them. Even a fifth grader knows that monopolies are not good for the economy. They are good for the business owner who has that monopoly on konjac sponges, since he can charge whatever he pleases, but it is the middle class that suffers.
Now we are all for a conservative America with better laws and policies but Trump’s way is not the right way if you know anything at all about economics. What we need are strategic tax cuts and regulatory relief from the anti-big business decisions made by Obama. This is the key to unlocking the deficit in American business competitive deficit, not trade and immigration barriers.
Trump’s over zealous pro business policies will not allow America to grow the way it should. Instead, it will put us in a position where more of our voters are alienated as they are thrust into poverty by a increased cost of living.