In the ongoing debate over U.S. trade policy, politicians and experts often claim that the public supports tariffs and other protectionist measures such as those given to us by the Trump and Biden administrations. However, a new Cato Institute poll reveals a more complicated picture: Americans may like the idea of tariffs and “Buy American” policies, but their support ebbs when faced with higher prices and other negative consequences. rate will drop.
This disconnect between abstract preferences and real-world actions with concrete drawbacks challenges the protectionist narratives that currently dominate both sides of the political aisle.
The survey, conducted by YouGov, involved 2,000 Americans. The beauty of it is that it does two things very well. It starts by asking people how they feel about a particular policy. Then, as reliable research predicted, it asked them again based on the actual costs and consequences of the policy. Looking at the different answers to these two questions can reveal more about how Americans feel about an issue than most ordinary polls can.
Economists understand that tariffs ultimately raise the prices of the goods to which they apply. Tariffs are taxes levied on imported goods. This tax is paid by the consumer. Americans must bear the additional cost of the same imported goods or pay higher prices for domestic substitutes (which may also be of lower quality because their producers are protected from foreign competition).
The poll reveals the extent to which Americans’ initial support for protectionist measures collapsed in the face of the idea of rising prices. For example, when asked whether they supported tariffs on imported blue jeans, 62% initially supported such a measure to boost domestic production and employment. However, a mere $10 price increase due to these tariffs would turn most people against it. When prices hit $50, a staggering 87% opposed the tariffs.
This price sensitivity also extends to the “buy American” sentiment. Although 75% of Americans claim to prefer domestic products, all else being equal, 51% would choose a cheaper foreign-made product of similar quality. Even more telling is that 70% of people would not pay even a $10 premium for an American-made skillet, and 76% deliberately refrained from purchasing American-made products in the week before the survey.
These findings expose a key flaw in the protectionist policy argument: While Americans may agree with the abstract concept of supporting domestic industry, they vote with their wallets to support the most affordable goods, regardless of their origin.
As policymakers on both sides of the aisle continue to parrot protectionist rhetoric and peddle protectionist policies, a reality check is crucial. The Trump-era tariffs, largely maintained by the Biden administration, were marketed to the public as a way to restore manufacturing jobs and counter China’s economic influence. But the poll suggests that support for tariffs could drop sharply once Americans feel the pinch of rising prices.
The poll also revealed two other facts that populist politicians would rather ignore. First, most Americans are not as obsessed with trade issues as politicians are. In fact, only 1% of Americans believe trade is a top priority. Second, 66 percent believe global trade benefits the U.S. economy, and 58 percent correctly believe global trade improves their standard of living. In fact, 63% favor increasing U.S. trade participation.
So, what is the way forward? First, we need honest and clear communication about the trade-offs involved in trade policy. Policymakers should acknowledge that protectionist measures can lead to higher consumer prices. It should be their responsibility to convince us that any benefit to a particular industry is worth it.
Second, if the goal is to support American workers and industry, we should explore alternatives that do not directly raise consumer prices. This could include manufacturing deregulation and capital gains tax reform to boost domestic investment and U.S. productivity—without resorting to trade barriers.
Third, we need better public education on trade issues. The more Americans understand the complexities of global trade and its impact on their daily lives, the better equipped they will be to evaluate policy proposals and hold their representatives accountable.
Finally, policymakers should focus on what Americans do, not just what they say. This poll makes clear that when push comes to shove, Americans prioritize affordable goods over protectionist ideals. Trade policies that ignore this fact could face a serious backlash once the effects are felt in markets.
As we navigate the complex waters of global trade in an increasingly interconnected world, it is critical that our policies reflect reality rather than adhere to protectionist myths that are inconsistent with Americans’ actual behaviors and preferences.
Copyright 2024 CREATORS.COM
