There has been a lot of talk over the past few months about whether or not the US should have tariffs on steel. There have been arguments made on both sides, but there are a lot of factors to consider.
This blog will look at the pros and cons of tariffs on steel to see if they are the right way to go.
What are tariffs?
Tariffs are levies or duties on goods being imported into a country. They are used by governments as a way to make sure the country is not left with empty pockets.
Tariffs are also used to offset the cost of the goods, which helps keep the prices of the goods down for the public to afford.
Keep in mind that tariffs, and their sister, subsidies, are not good or bad, but it is how they are used.
If a government is using tariffs as a way to just make money, they are being greedy, but if they are using them to offset the cost of goods, they are just making sure the economy is being run properly and that the people are not overcharged for goods. This leads to a better economy, which is how governments are supposed to work.
What are the arguments for tariffs?
There are many arguments for tariffs on steel. The most common one is that it protects American jobs. A tariff on steel raises the price of imported steel, making it more expensive to produce steel in America. This makes it more expensive to produce goods that use steel, such as cars and appliances, making it less likely that companies will import steel and more likely that they will produce steel in America. This creates more jobs in the process.
Another argument for tariffs on steel is that it protects American companies from foreign competition. Steel is a critical component in a wide range of goods, from cars to appliances to construction materials. If foreign companies can produce steel more cheaply than American companies can, they can undercut American companies in the global marketplace. A tariff on steel makes it more expensive for foreign companies to produce steel, which gives American companies a competitive advantage.
A final argument for tariffs on steel is that they can help reduce the trade deficit. The United States has a trade deficit because it imports more goods than it exports. A tariff on steel can help reduce the trade deficit by making it more expensive to import goods that use steel.
