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Theyre an act of war, to some degree.
Many economists and international trade experts agree, even if they wouldnt put it so bluntly.
Heres what the Oracle of Omaha means and why most trade experts agree with him.
Or they can use the threat of economic force, such as tariffs.
It typically provokes retaliation, where both sides strike back, ultimately launching a trade war.
And who pays for a trade war?
The citizens of both countries in the form of higher-cost goods.
I mean, the Tooth Fairy doesnt pay em.
Businesses that import goods dont just roll over and take the hit to their bottom line, either.
They pass them on to consumers in the form of price hikes.
Businesses face higher costs, jobs are lost,savings and retirement fundsshrink in purchasing power.
It makes you wonder: Why are we the ones paying the price for these political power struggles?
It posits that no two countries that sharemajor global supply chainshave ever fought a hot war.
Fewer trade ties mean less economic incentive to keep the peace.
John Anwesen, international trade attorney withLighthill, expands on this point.
Those interactions and interdependence makes them less likely to go to war.
But free trade has actually proven extremely kind to the U.S. economy, not just its trading partners.
The math tells us that international free trade has improved, and helped maintain, the U.S. economy.
One way that free trade helps both countries to grow their economies is through specialization.
Ever try growing coffee beans in the U.S.?
International trade isnt one-sided it provides something of value to both parties.
We wouldnt do it otherwise.
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