Ushering in The Golden Age of America
The concept of the “Golden Age of America” often evokes images of economic prosperity, technological innovation, and global leadership. One of the key factors that could contribute to this new era is the strategic elimination of trade barriers such as tariffs, duties, and value added tax. By fostering an environment where U.S. businesses can export goods more freely and competitively, we can unlock unprecedented economic growth and stability.
The Impact of Eliminating Trade Barriers
Trade barriers have long been a significant cost for U.S. businesses, affecting their ability to compete globally. Tariffs, duties, and VAT can add substantial costs to exported goods, making them less attractive to foreign markets. However, if these barriers were reduced to zero through new trade agreements, the multiplier effect on the U.S. economy could be profound.
- Increased Trade Volumes: With zero tariffs, duties, and VAT, U.S. businesses would find it cheaper to export goods, leading to higher export volumes. This could boost the overall trade balance and economic growth.
- Lower Costs for Businesses: Businesses would save on the costs associated with tariffs, duties, and VAT, improving their profitability. These savings could be reinvested into the economy, leading to job creation and higher wages.
- Higher Consumer Spending: Lower costs for imported goods would translate into lower prices for consumers. Increased disposable income could lead to higher consumer spending, further stimulating economic growth.
- Enhanced Competitive Advantage: U.S. businesses would be more competitive globally, potentially capturing larger market shares and expanding their operations.
- Economic Multiplier Effect: The combined impact of increased trade, lower business costs, and higher consumer spending would amplify economic growth. Estimates suggest that every dollar saved from reduced tariffs could generate multiple dollars in economic activity.
Estimated Costs and Revenue
To illustrate the potential impact, let’s consider the estimated costs in tariffs, duties, and VAT for U.S. businesses exporting to the top 20 countries:
| Country | Grand Total | Fuel Export Value | Tariff Costs | Duties Costs | VAT Costs |
|---|---|---|---|---|---|
| Mexico | $621.2 billion | $334.04 billion | $167.0 billion | $66.8 billion | $53.4 billion |
| China | $413.5 billion | $143.55 billion | $179.4 billion | $71.8 billion | $18.7 billion |
| Canada | $487.7 billion | $348.41 billion | $87.1 billion | $34.8 billion | $17.4 billion |
| Netherlands | $121.0 billion | $89.64 billion | $8.9 billion | $3.6 billion | $18.8 billion |
| United Kingdom | $123.9 billion | $79.89 billion | $8.0 billion | $20.0 billion | $16.0 billion |
| Japan | $114.4 billion | $79.72 billion | $19.1 billion | $7.6 billion | $8.0 billion |
| Germany | $115.3 billion | $75.38 billion | $18.3 billion | $7.3 billion | $14.3 billion |
| South Korea | $95.1 billion | $65.54billion | $16.4 billion | $6.6 billion | $6.6 billion |
| Brazil | $75.5 billion | $49.67 billion | $12.4 billion | $5.0 billion | $8.4 billion |
| Singapore | $56.5 billion | $46.02 billion | $4.6 billion | $1.8 billion | $4.1 billion |
| France | $59.4 billion | $44.39 billion | $4.4 billion | $1.7 billion | $8.9 billion |
| India | $55.8 billion | $41.75 billion | $4.2 billion | $1.6 billion | $8.3 billion |
| Australia | $46.4 billion | $34.58 billion | $3.5 billion | $1.4 billion | $6.9 billion |
| Belgium | $45.8 billion | $34.18 billion | $3.4 billion | $1.4 billion | $6.8 billion |
| Italy | $43.4 billion | $32.40 billion | $3.2 billion | $1.3 billion | $6.5 billion |
Multiplier Effect on the U.S. Economy
The multiplier effect of eliminating these trade barriers can be substantial. Here’s an updated table showing the estimated multiplier effect on the U.S. economy:
| Factor | Estimated Multiplier | Dollar Amount |
|---|---|---|
| Increased Trade Volumes | 1.5x | $2,211.0 billion |
| Lowers Costs for Businesses | 1.3x | $1,916.2 billion |
| Higher Consumer Spending | 1.2x | $1,768.8 billion |
| Enhanced Competitive Advantage | 1.4x | $2,063.6 billion |
| Economic Multiplier Effect | 1.6x | $2,358.4 billion |
| Grand Total | $10,317.0 billion |
These numbers are estimates only and are a sign of future prosperity.
By strategically eliminating trade barriers, the U.S. can usher in a new era of economic prosperity, characterized by increased trade volumes, lower costs for businesses, higher consumer spending, enhanced competitive advantage, and a powerful economic multiplier effect. This is what partly defines the Golden Age of America, where the nation stands as a beacon of economic strength and global leadership.