Resolved: Tariffs harm domestic and foreign economies.

This round will be for responding to the opponent's argument, final statements on other arguments, and voting issues. You may not bring up new arguments, but may respond and expand upon past arguments.Upholding my own caseWhat is a tariff and what about it hurts economies?My opponent did not address this argument whatsoever. He forfeits this argument.Tariffs hurt domestic economiesMy opponent mentioned only two problems with this entire argument, and that is the Hawley-Smoot tariff and infant industry argument. He asserts, "Pro claims that since the Hawley-Smoot Tariff failed, tariffs harmful to the economy. This is an obvious logical fallacy. The success of tariffs obviously depends when and how they are enacted."The Hawley-Smoot Tariff didn't fail, but that's not the problem; the problem is that it succeeded. It raised dutiable rates to sky-high levels for over 20,000 imported goods. [1] Can you imagine how much costs would rise for manufactureres, producers, small businesses, and government programs when over 20,000 imported items, many of which used in great demand over US goods and of greater economic efficiency than those made in the US. Since a basic understanding of economics leads us to an idea of wealth creation through trade, it follows to say that much wealth was regretfully not created while the Hawley-Smoot Tariff was in place. [4] For example, one-quarter of all wealth created today comes from international trade. [2] U.S. imports decreased 66% from US$4.4 billion (1929) to US$1.5 billion (1933), and exports decreased 61% from US$5.4 billion to US$2.1 billion, both decreases much more than the 50% decrease of the GDP. [3] Thus, the wealth creation that could have occurred was sadly not not occurring, because of an inane Washington policy. Tariffs are harmful to an economy, because they artificially sustain jobs that the market would otherwise not allow. Absent the tariffs, the economies of the world would restructure in a way in which the countries most specialized and best at doing a certain industry, manufacturing a certain product, or doing a certain service would help all other economies through absolute and comparative advantages, and leaving tariffs in place only increases opportunity costs of doing those things. [5]"Furthermore, Pro ignores that the U.S. tariffs at the time were mostly successful, protecting its infant industries and allowing them to develop." This is his next objectionh in his rebuttal as well.Robert P. Murphy absolutely demolishes this argument. He writes, "It is telling that such proposals never mention the duration of the "maturation" process. After all, if consumers are forced (by the tariff) to pay higher prices to relatively inefficient domestic producers for, say, two years, after which the domestic producers will outcompete the foreign rivals and offer lower prices forever after, then the deal doesn't sound so bad. But if consumers are forced to indirectly subsidize inefficient domestic producers for eighty years in the hope that they will one day become competitive, then the proposal sounds far less appealing. The fact that those espousing the infant industry argument never even mention the time frame just shows how little thought they've actually given to their proposal. The infant industry proposals notwithstanding, the free market contains a mechanism by which firms can suffer short-run losses so long as they are compensated by eventual long-run profits. That mechanism is simply a loan. Plenty of new firms, especially sole proprietorships, don't make money in their first few years of operation. But so long as the present value of the firm's expected future cash flows is positive, the firm's owners should be able to borrow money to finance the first few years as they develop experience, name brand trust, etc. If a firm or group of firms can't achieve funding from private investors to go ahead with their projects because the present values of their ventures are negative, then that is the market's way of saying that their schemes would squander valuable resources in the short run without sufficiently compensating gains in the long run. The advocate of a tariff to promote an infant industry is thus saying that he or she knows better how to determine intertemporal tradeoffs than the average person in his decisions to borrow or lend money at different rates of interest. The absurdity of the infant industry tariff can be illustrated by considering an "infant worker" tax, which would be a tax levied on experienced workers in order to encourage businesses to hire younger workers with less experience. After all, without giving the young workers such help, how would they be able to survive during the years of training in schools? Clearly we need to tax older workers in order to encourage the development of human capital in our infant workers!" [6]RefutationFree trade creates trade deficits.This is not true, and this argument overlooks some basic fundamentals in how trade works. For example, a country may have a trade deficit with Japan, but do to the input efficiency of trade with Japan, thatand efficiency country may have trade surpluses with other countries, actually increasing wealth creation and economic specialization all around. [6]Robert P. Murphy writes, "If trade deficits still seem dangerous, consider that everyone (who has a job) has a huge trade surplus with the city in which his or her employer is located, and a trade deficit with many other cities in the United States. In my case (and as I explain to my students), I have a huge trade surplus with Hillsdale County: if we added up all of the transactions I conduct with people who live in Hillsdale County, we would find that every month I end up paying out far less than I receive. In contrast, I have a large trade deficit with the nearby city of Jackson, since this is where my wife and I go on weekends when we want to do some decent shopping. Am I conducting my trade policy foolishly? Should I restrict my purchases from Jackson until I take a part-time job in that city, perhaps at the Denny's?"Tariffs save domestic jobs and industries.Actually tariffs do save domestic jobs and industries, but at an extreme economic expense and economic efficiency expense. This can be aptly demonstrated with steel tariffs: Every state in the union will suffer net job losses as a result of the tariffs; Ironically, the biggest job losses will occur in "steel belt" states such as Pennsylvania and Michigan. For every steel job "saved" as a result of the tariff, eight jobs will be lost in all sectors of the economy; The steel producing industry would save between 4,400 and 8,900 jobs at a cost of between $439,485 to $451,509 per steel job saved; Higher prices for steel products and related inefficiencies would decrease U.S. national income from between $500 million and $1.4 billion at a time when policy-makers are talking about ways to improve the U.S. economy. It is better for an economy to restructure and develop and absolute or comparative advantage than to ineptly protect industries where an economy does not perform well at an economic expense to consumers, producers, employment, and the economy as a wholeThese protectionist claims are unsound.Quotes"A study of economics usually reveals that the best time to buy anything is last year." -Marty Allen"Wall Street is the only place that people ride to in a Rolls Royce to get advice from those who take the subway." -Warren Buffett"After all, the chief business of the American people is business. They are profoundly concerned with producing, buying, selling, investing and prospering in the world." -Calvin Coolidge"I made my money by selling too soon." -Bernard BaruchVOTE PRO[1] Taussig (1931) [2] Peter Leeson (2010)[3] http://en.wikipedia.org...[4] http://www.infoplease.com...[5] http://www.econlib.org...[6] http://mises.org...