2. Introduction A tremendous decrease in economic growth has
occurred here in America and internationally. This growth shrinkage
results in many questions concerning the cause. What has occurred
centers on the wonton wastefulness of the consumer. More
specifically, the coined baby boomers are considered to begin the
trend of wastefulness because they were the generation immediately
after the Great Depression. As time progressed, this wasteful way
of living took a pronounced toll on the economy. Further,
protectionism, a theory that supports the enforcing of tariffs,
duties, and subsidies, rules have been contributed under to topic
of economic exhaustion. Protectionism is understood to place more
restrictions on countries participating in trade. Though intended
to balance the market of trade, it negatively impacted trade. It
places, in a sense, too many restrictions on trade agreements.
Pertaining to wasteful consumers, individually making these
decisions would be a plausible course or direction. Collectively,
those government officials over protectionism laws can either
change the standards of their laws or allow those who chose the
opportunity to participate in free trade. Cooperative free trade
agreements would exponentially and economically benefit the world.
Particularly, free trade would improve the apparel market because
it would allow inordinate amount of benefits to the industry. For
example, those of merchandising would be affected because the
amount of jobs would skyrocket. An increased need for merchandising
would be apparent because the amount of merchandise needed to be
regulated would increase even more. Free trade is a very beneficial
approach to trade that is misperceived, but it will only work with
cooperates.
3. REVIEW OF LITERATURE Origins of Free Trade The origins of
the concept of free trade are associated with the European Union,
where Great Britain decided to acquire an informal empire for the
purposes of expanding their empire. It is also a product of the
Imperialist versus Anti-Imperialist dispute (Gallier &
Robingson 2013). The success of their empires growth was remarkable
and naturally, it enticed restrictions because Anti-imperialists
were in disagreement with the imperialist. This negative reaction
only provided Great Britain more motive to counteract their
negativity with more expansion. Over the next half decade, Great
Britain had acquired over ten countries within their empire (2013).
Imperialists were understood to strongly agree with the theory of
capitalism, the method of how the United States proceeds to run its
government. However, this correlation leaves many holes in the
story given (2013). The European Union and North America advocate
great examples of free trade agreements. These agreements allow
countries to share crops and consumers with no special tax, which
potentially lead to boosts in all of their economies. Free Trades
Contribution to Globalization Modern technology globally
illuminates the concept of diversity resulting in it becoming a
blur. It has allocated avenues for a tremendous amount of
communication to the world. Alongside a broader international
knowledge base. With this great amount of understanding and
communications, it has brought about more advanced ways of living.
It spirals from the individual to how the world operates. The
concept of
4. globalization has become a less farfetched idea in the past
two decades more than ever because of modern technology. It has
sped up the process of trade and broadened the possibilities of
what is allowed to be traded. The concept of comparative advantage
explains international trade in goods and services in which
countries export and import various products (Laffer 2014).The
process of trade caused the growth of many, if not all, economies,
empires, and unions. It increases the level international
competition. North American Free Trade Agreement (NAFTA) NAFTA is a
free trade agreement established between Canada, Mexico, and the
United States. This agreement denotes there are no special taxes
shared when trading, and it has been established for more than
twenty years. NAFTA includes three bilateral agreements, one
between each country where it not only includes regulations that
remove quotas and tariffs, but demands each country meet sanitary
and phytosanitary criteria (Zahniser, Angadjivad, Hertz. Kuberka,
Santos 2015). These sanitations regulations are measured strictly
based on science to prevent any discriminatory matters. It also
states principles on how those in this agreement treat foreign
investors. This agreement also provides ways to solve disputes
about the agreement, as well as antidumping duty enforcement
(2015). It also brought about much success for all three countries
included. All parties benefit from the local resources each
provides. It opens up new territory for sale of their product,
while broadening the variety for the consumer. However, it
allocates more competition for the producer, and that may
potentially cause profit loss. Over its life span, NAFTA has caused
a continual increase of imports and exports for Mexico, Canada, and
the United States. The imports have risen from under five percent
to over fifteen percent between the U.S. and Mexico, and over
twenty
5. percent between the U.S. and Canada. U.S. agricultural
exports to the NAFTA countries continue to grow, both at the
aggregated level and the commodity level for many products. The
tripled growth of all three NAFTA countries is just one of the many
example of the benefits of Free Trade because it allows fair profit
as well as the rule of law. This allows all to operate in a
beneficial realm of fair competition. Objections to Free Trade Free
trade agreements have been countered by the rules and regulations
of the Protectionism theory, and historically observed, by other
parties, as well. Protectionism: policy of protecting domestic
industries against foreign competition by means of tariffs,
subsidies, import quotas, or other restrictions or handicaps placed
on the imports of foreign competitors (Research Starter, 2014).This
international taxation was rooted before World War I and has been
documented to alleviate citizens from getting out of paying
personal income taxes (Zuchman 2014). This theory also manifested
itself in the European Union when Great Britain favored the Free
Trade expansion plan. However, this theory is not seen very much in
the EU. Actually, there are more free trade agreements than
protectionism laws seen in the Western World (Research Starter
2014). To those at a higher level in government, it was a
contractual guarantee utilizing expense money for the economy as
well as allowing more potential profit. The United States has been
observed to be a Protectionist country, though it benefits from its
free trade agreement with Canada and Mexico.
6. Discussion Free trade is a set of principles that, commonly
neighboring countries, agree to disregard all of their product and
merchandise taxes when trading with countries within a written
contract. There is a rising misconception obstacle not allowing
those in free trade agreements to reach their full potential is
protectionism. It is a common understanding that this method of
trade is there as a relief from taxes within these agreements. The
impression of the agreement is conceived in a positive
understanding by determining the commonality within each. However,
Protectionism is not the sole cause of free trade agreements not
reaching their full potential. Restrictions are still implemented
within those contracts of free trade as well as other trade
agreements. If the agreement was in place to prevent countries
involved from paying taxes, why are there still restrictions? There
should be a focus on the content of these agreement before
criticizing the content of another theory on trade. More
specifically, in NAFTA, there are restrictions between the United
States and Canada on dairy products, peanuts, peanut butter,
cotton, sugar, and sugar-containing products (Zahniser, Angadjivad,
Hertz. Kuberka, Santos 2015). These products are exempt
specifically because of the agreement between the U.S. and Canada
in 1989, which are included in NAFTA (Zahniser, Angadjivad, Hertz.
Kuberka, Santos 2015). These restrictions advanced upon the request
of Canada. Canada has also formed a way to prevent free trade of
poultry and dairy products between them and Mexico. If they agree
to trade freely, then they should be just that. All of which
correlate to false representation of the agreements title. The
restrictions in NAFTA alone exhibits how the agreements positively
affect those within the agreement, but are tremendously flawed and
causes
7. much disarray. Dr. Authur B. Laffer explained that the
completion of a well-negotiated Trans-Pacific Partnership and the
Transatlantic Trade and Investment Partnership, free trade
agreements with most of the nations around the Pacific Ocean and
the European Union, respectively, would benefit the United States.
These agreements are not clear on where things are or not to be
taxed. Another agent that causes depreciation in how free trade
will reach its full potential is h the governments methods of
regulating spending. The United States was previously one of the
most powerful countries in the world. Nevertheless, because of how
its government handled spending it has lost that attribute. The
American dollar is losing so much of its value because of the
governments systems. The governments spending more than what has
been acquired places a great restriction on allowing more free
trade. For example, there are four American dollars to one United
Kingdom pound. Europe would relish in buying from America, but free
trade would benefit Europe because it would cause money loss, and
the cost ratio is always chosen to balance trade. Taxes were
implemented originally to place demand on those who are benefitting
from their states revenue. Moreover, the government improperly
handling its gained revenue is causing this country to lose
competency in trade. This behavior from the government makes it
more difficult for another country to be in agreement to trade
freely with the United States.
8. Conclusion Free trade agreements benefit economies more than
many of the other methods of trade. These agreements are in place
to provide a balanced international economy, but restriction
implemented because one country does not want to contribute as much
as others places barriers on achieving that balanced economy. Free
trade agreements are also often debated because they do not benefit
the individual, and the individual is who controls those elements
that go into the trading method. Therefore, it does not bring
collective contentment. This indeed has placed all economies a
great imbalance. When those within agreements prioritizes the
balancing of the world first, it would bring great relief to the
incompetency of how the world operates in trade. More trade will
lead to more money, and more money creates more jobs; positivity
will continue down the hierarchy.
9. Works Cited Zucman, G. (2014). Taxing across borders:
Tracking personal wealth and corporate profits. Laffer, A. B.
(2014). Currency Manipulation and its distortion of free trade.
Gallgher J., Ronald Robinson. (2013). The imperialism of trade.
Zahniser, S., Angadjivad, S. Hertz, T., Kuberka, L., Santos, A.
(2014). NAFTA at 20: North Americas Free-Trade Area and Its Impact
on Agriculture. Research Starter. (2014). Protectionism.
Encyclopdia Britannica, September 2014
