Unexpectedly, I find myself advocating for the United States to help invigorate its export industry through subsidies, rather than imposing tariffs on the world. The key U.S. exports—including many ensnared by global tariffs—could benefit from this measure. In our current situation, where there’s an ongoing tariff battle, this idea might appear belated, but I present an alternative perspective. The United States has a choice: it can use taxpayer dollars to boost American businesses on the international stage (subsidies) or accumulate tax revenue for the federal government’s expenditure (worldwide tariffs). I see this as choosing the lesser evil.
Before diving into particulars, allow me to share some thoughts: In contemporary times, subsidies aren’t seen as alarmingly controversial anymore, albeit with a touch of irony. In contrast, the president’s beloved tariffs may seem to consolidate the government’s coffers, but they also, via counter tariffs, strengthen our international competitors’ federal reserves. They seldom address the issue they’re purported to solve, and less frequently in a straightforward fashion.
Empirical evidence suggests that steel tariffs could aid a select few at many others’ expense. One issue dominating the conversation is the escalating trade deficit of the United States. Unfortunately, it’s been on an upward curve for years. As much as it surprises me that I’m endorsing subsidies, I question: Wouldn’t it be beneficial to reimburse the tariffs on U.S. exports to the commercial entities facing them?
Such a step could empower U.S. businesses, boost U.S. exports, and curtail the monstrous U.S. deficit. It could have significant socioeconomic impacts, including job creation. Europe, Japan, China, India, Brazil—the roster of nations imposing restrictions on U.S. exports isn’t exhaustive but is noteworthy.
Take the European Union, for example, which imposes tariffs on dairy, processed foods, and vehicles. If we subsidize these goods to offset the added cost, we’re effectively saying: ‘Let your citizens make the choice.’ By reimbursing tariffs, we would enable our dairy, beef, and rice to compete fairly on the Japanese market.
Similarly, if the U.S. government bore the cost meant to shut out American exports to China, we could offer them industrial goods, pork, poultry, and soybeans at competitive rates. In India, where there is a significant fan base for Harley-Davidson motorcycles, riders could afford their dream bike if the tariff-inflated price was subsidized by the U.S. government.
Furthermore, the major players, including the countries mentioned earlier, superimpose hefty restrictions on pharmaceuticals and medical devices—areas where U.S. production thrives. Could this policy potentially result in inflation, as tariffs have been criticized for, by creating domestic shortages? Potentially, it could. However, producers could mitigate this risk through hiring and performance augmentation.
Any certainty of reducing the deficit? None whatsoever. Yet, with a boost in exports, economic benefits are likely. But how does this saga end? It may be that the next president can work towards a gradual reduction of both subsidies and tariffs in conjunction with the international community to fashion a mutually beneficial future.
Wouldn’t we be living in a more desirable world where more individuals could afford to purchase U.S. goods? Over time, wasn’t this aspired scenario gradually materializing?
To reiterate, the argument here is not for an endorsement of damages imposable by tariffs, but for an evaluation of an alternative way forward, where U.S. exports are supported through subsidies to reduce our trade deficit, all while creating a more sustainable and accessible global market for all.
The post Boosting U.S. Export Industry through Subsidies over Tariffs: An Alternative Perspective appeared first on Real News Now.
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