If they have to choose, most Americans prefer low prices to items made in the United States. An Associated Press/GfK poll shows that faced with a price difference, most will buy less expensive foreign goods. Three in four say they would buy domestic products if they could, but those items are too costly or difficult to find.
This political season, when one presidential candidate promises to make America great again and another is attacking recent trade agreements, what people really are saying is they want less expensive American-made goods, and they want to earn the wages that would make such goods affordable. That is a tough challenge.
It is tempting to take individual pieces of that puzzle and proclaim them as the solution. Import controls, for example, sound like a good thing, especially when corporate livestock growers on the East Coast are importing corn from Brazil. Cut off that supply and make them buy American corn! The effects of that added cost would ripple through the economy, make people wonder why they couldn’t afford to buy pork, and when the demand for pork dropped, so would the demand for corn.
To complicate matters further, “trade” suggests two-way relationships, and the U.S. Department of Agriculture estimates that drought-stricken American corn farmers still will supply 40 percent of the corn traded on the global market. No one wants to eliminate foreign markets for U.S. goods.
Many other factors come into play, but the point is that every economic policy decision has broader consequences than simply fixing a perceived problem.
Part of the issue is the way Americans remember their nation’s greatness. Some of them harken back to the years following World War II, when a family could live comfortably on a single income. However, homes were markedly smaller than those being built now, and most families had far fewer possessions: one car, one television set, one telephone plugged into the wall. They had no cable television, no computers, no Internet — they simply had far less stuff.
Most of what they did have was made in America, because Japan and Europe were just beginning to recover from World War II, China was still locked behind a closed border, and the rest of Asia had not yet developed into substantial manufacturing industries.
Look at how much more complicated people’s buying habits have become, and how many more possessions they have. Since the post-war era, increased consumerism has been made possible by increased employment; two-income families are now the norm, and a significant number of adults hold more than one job.
Viewed in isolation, outsourcing of jobs is hard to defend, especially as immigration swells the domestic labor force. The fact is, though, much of what the United States imports cannot be produced here at competitive prices. Filthy air in Beijing and child labor in developing countries keep consumer prices in the United States low, and those are not problems we want to import.
Creating an economy of affordable American goods and services is not going to be easy, and it is not going to be accomplished by someone with a minimal knowledge of economic policy. Voters should not be convinced by simplistic slogans that fit on ballcaps. The economy is much more complex than that, and so must be any proposal to improve it.
