Question

There is an ongoing debate about whether free trade is beneficial for the global economy. Choose whether you support free trade or if you prefer trade barriers. Be sure to cite specific facts and figures to support your analysis. Remember that there may be more than one perspective which could be equally valid given the circumstances.

Please answer in 150 words or more. Use your own words - please do not copy and paste from a web site. Be sure to reference your sources.

Answer 1

Completely free trade is unlikely because in distinct phases of growth, nations have vastly distinct economies, varying degrees of national financial and political freedoms, and distinct currencies. Governments would have to reverse much of the participation they have acquired since the 1930s in their economies and financial markets to attain free trade. They would have to abandon significant sovereignty to market forces and in the name of health and safety, either to promote local industry or because of genuine civic issues, they could no longer keep imports out.  Completely free trade would also require completely free-floating currencies with no government interference. It’s hard to imagine politicians giving up all that control.

Free trade means just what the name suggests: free and unfettered trade between nations, free from high tariffs, and where products can cross boundaries without any constraints. Protectionism, on the other hand, also means what the name suggests: it is the method in which governments slap rigid taxes–tariffs–and a host of restrictive products laws that other nations want to export. Free trade tends to increase trade deficits in some nations to potentially disastrous levels.

Every dollar in trade deficit, generally sparked by free trade, means a dollar taken from U.S. workers and, instead, going to workers overseas. The result is lost jobs in the U.S. as other countries, with much lower labor costs and often with business supported by government assistance, gain jobs.

International trade is the exchange of goods and services across national borders. In most countries, it represents a significant part of gross domestic product (GDP). The rise of industrialization, globalization, and technological innovation has increased the importance of international trade, as well as its economic, social, and political effects on the countries involved. Internationally recognized ethical practices such as the UN Global Compact have been instituted to facilitate mutual cooperation and benefit between governments, businesses, and public institutions. Nevertheless, countries continue to face challenges around ethical trading and business practices, especially regarding economic inequalities and human rights violations.