In a new article at The Stream, Acton Director of Research Samuel Gregg offers good reasons why a move toward economic nationalism is not in the best interest of America. He starts with this:
Whatever the motivations for such policies, their costs vastly outweigh their benefits. In the first place, protectionism discourages American businesses and workers from focusing on producing those goods and services where they enjoy a comparative advantage vis-à-vis other nations. Not only does this undermine productivity, efficiency, and international competitiveness of American businesses. It also encourages American workers to enter industries that, no matter how much protection they enjoy, won’t be able to compete in the long term.
Gregg continues to give reasons against economic nationalist policies throughout his article, but one reason that seems to be quite relevant at the time is crony capitalism. Gregg says this:
Yet another problem with economic nationalism is that it encourages a growing problem in American economic life: crony capitalism.
Giving certain American businesses subsidies or lumbering foreign products with tariffs may seem like economic questions, but in practice they are ultimately political. Such policies encourage companies prefer to seek profits by lobbying legislators and bureaucrats rather than serving customers and creating value.