Protectionism: A Threat to Individual Freedom; S. Lai

This basic right, along with such civil rights as freedom of speech and religion, must be de fended or else the government becomes a threat to all individual liberties. Protectionism takes several forms, all of which violate consumer freedom of choice. Tar iffs are the most frequently cited example. In an effort to save Harley-Davidson, the V.S. re cently raised the duty on foreign motorcycles from 4.4 per cent to 49.4 per cent. l Along with tariffs, protectionist policies have grown to in clude import quotas on foreign goods and gov ernment subsidies to V. S. industries. Other forms of protection include regulations and standards on foreign imports, and government procurement policies which favor the purchase of domestic products. Protectionism has its roots in the mercantilist period of the sixteenth to eighteenth centuries. Mercantilist legislation was based on the theory that a nation gains wealth only by exporting its products. This completely overlooks consumers and their needs. In the nineteenth century, the Corn Laws of Great Britain provided a tariff barrier against foreign grains, and caused un told suffering among the poorer masses.

V. S. tariffs originally accounted for 92 per cent of Federal revenue.2 In more recent years, the percentage has fallen to around 1 per cent.3 The decline in percentage was caused by an in crease in the sources of government revenue, not by a reduction in tariffs. The Smoot-Hawley Tariff Act of 1930 raised V. S. tariff barriers to Stephen Lai is a senior at Wichita Collegiate School, Wich ita, Kansas. their highest levels, which provoked foreign re taliation resulting in a disastrous plummet in in ternational commerce. As Ronald Reagan stated, the tariff "helped plunge this nation and the world into a decade of depression and de spair.,,4 Currently the textile, steel, shoe, and elec tronics industries are petitioning the govern ment for protection from foreign imports. V. S. producers also call for raising a protectionist wall against the "flood" of Japanese products and retaliation against Japanese protectionism.

The V. S. limits Japanese car imports and still restricts carbon steel imports to one-fifth of the market, because the Japanese subsidize indus tries such as their machine tool manufacturers and charge a 15 per cent to 20 per cent duty on plywood imports. 5 About 180 trade protection bills are being considered by the House of Rep resentatives, and over 300 in the Senate. 6 With more special-interest legislation interfering with the market, the forgotten consumer pays higher prices for fewer goods. Protectionism has evolved because of the no tion that exports are good and imports are bad. Many people mistakenly believe that every transaction must have a winner and loser, de spite the fact that people trade because, in their own eyes at least, each expects to gain. Protec tionists therefore advocate a "balance of trade" based upon equal sales to both nations. Industries argue for protectionist policies to allegedly protect consumers from low-quality foreign items and to insure their employees' jobs. These companies disguise their true pur pose of gaining security through the elimination of competition.