As an American, One should Only purchase American cars to preserve and encourage American Business

Thanks Pro, for instigating. Protection is an extremely harmful policy. I'm always baffled when I hear conservatives who support it. It's essentially based on the same argument that all trade is exploitative which drives many liberal policies. The "buy American" fad is basically a ploy by American manufacturers to exploit the patriotism of the economically illiterate. 1. Pro is a xenophobe Why should I support American businesses? What difference does it make to me whether some random guy from Arizona I've never met or some random guy from Tokyo I've never met benefits from my purchase? By implying that we should care more about Americans than foreigners, Pro is basically advocating racism and xenophobia. 2. Buying foreign can be economically beneficial In a satirical letter to the French government, Frederic Bastiat famously petitioned on behalf of the domestic candlemakers for legislation protecting them from a foreign competitor. By inundating the market with cheap light, this foreign competitor was running the french candlemakers out of business! The "foreign competitor" he was referring to, of course, was the sun. His mock proposal was that people be required to close their window blinds during the day so they would have to use candles. Obviously, Bastiat's "argument" is completely ridiculous. By saving money on candles, everyone has more to spend elsewhere. The same is true if I buy an inexpensive foreign car instead of a costly, inferior American alternative. 3. Buying foreign doesn't necessarily hurt American workers Many foreign cars are actually built in America. In 2005, 3.7 million "foreign" cars were actually produced here, compared to 3.4 million that were imported.[1] According to the Boston Globe, "Toyotas, Hondas, Subarus, BMWs, Mercedes-Benzes, Hyundais and others – more than 40 models of foreign cars, minivans, SUVS and pickup trucks – are rolling off assembly lines at 15 plants in the United States."[2] Conversely, many "American" cars are actually produced abroad. The Ford Fusion is built in Mexico and only half of its parts are produced in the US. The same is true of GM's Suburban, the Cadillac Escalade, and the Dodge Ram Mega Cab. The Ford Flex is built in Canada.[3] A 35% share of Chrysler is owned by Fiat, an Italian company.[4] 4. Comparative advantage The law of comparative advantage explains how one entity can produce a particular good or service at a lower opportunity cost than another, even if the second entity has a greater absolute advantage. For example, let's say Mises Land and Marx Land are two countries of equal size that produce and consume two types of goods: wheat and potatoes. If both countries produced wheat, the output of Mises Land would be 200 tons per month, while Marx Land would produce 100 tons per month. If both countries produced only potatoes, their outputs would be 200 tons per month and 50 tons per month, respectively. Now, Mises Land has an absolute advantage in the production of both wheat and potatoes. However, Marx Land has a comparative advantage in the production of wheat. Let's say both societies require both wheat and potatoes. So Mises Land produces 100 tons of potatoes and 100 tons of wheat. Meanwhile, Marx Land produces 50 tons of wheat and 25 tons of potatoes. Together, the two countries produce a total of 150 tons of wheat and 125 tons of potatoes -- 275 tons in all. Now, what if Mises Land and Marx Land decide to specialize in the production of potatoes and wheat, respectively? Instead of Mises Land producing 100 tons of potatoes and 100 tons of wheat, Mises land can produce 150 tons of potatoes and 50 tons of wheat. Marx Land could produce 100 tons of wheat and the two countries would engage in trade. Now, Mises Land has 100 tons of potatoes and 100 tons of wheat. Marx Land has 50 tons of potatoes and 50 tons of wheat, for a total of 300 tons in all. The same principle applies to all areas of the economy. If foreign companies can produce better cars at a lower price, erecting trade barriers only prevents us from achieving the optimal outcome. The capital currently allocated toward the automotive industry could be put toward other, more efficient uses. 5. Protectionism stifles competition and innovation By isolating domestic companies form competition, protectionism allows them to sell inferior products at higher prices. It's basically a form of corporate welfare that hurts lower and middle-class consumers. Not only this, but in the long term, it tends to hurt corporations as well. Harvard economist Robert Lawrence contends that the 40-year, 25% "chicken tax" on foreign light trucks crippled the US auto industry.[5] The absence of competition allowed American auto companies to comfortably reap ridiculously high profits from the sale of pick-up trucks while neglecting their other product lines. The result has been that foreign manufacturers have gradually taken over much of the market. References: 1. http://www.signonsandiego.com... 2. http://www.azcentral.com... 3. http://www.usatoday.com... 4. http://online.wsj.com... 5. http://www.greencarreports.com...