What Happens When There Is a Surplus of Imports Brought Into the Us

Decent Essays
International Trade and Finance Speech
What happens when there is a surplus of imports into the U S:
A surplus of imports is good for consumers but bad for local business. We have to produce and manufacture in order to export. As our export trade shrinks, so does our workforce and economy. The surplus of imported cars for 2012 has exceeded the exportation by $152 billion. Also the shelf life of cars is 1 year. Every year at the end of the cycle the existing models are sold off at huge discounts to make room for the new models, which is good for the consumer. What are the effects of international trade to GDP, domestic markets and university students.
International trade comprises exports and imports, the net result of which affects
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The U.S is the largest importer of Chinese goods. If the U.S stops the importation of Chinese goods, it is unimaginable what they would do with all these unused products. There would be no production or manufacturing of goods. Unemployment would be high, there would be no source of income and the country’s economy would be ruined.
As the largest importer of Chinese goods most of the local U.S companies rely on these imports for doing business. They import spare parts, automibles, manufacturing goods, appliances, electronics and building materials just to name a few. If Chinese imports are stopped the economy of both countries would be ruined as well as the world’s economy. In order to minimize the amount of imports coming in from all other countries the U.S government would have to change the regulatory trade restrictions that are presently in place by increasing taxes and quotas. This would not be in the best interest of the U.S economy. We rely heavily on imports. If we do this, the other companies would retaliate. The Smoot-Hawley tariff was tried in 1930 when tariff on imported goods was raised to an average of 60% . As a result, trade wars ensued and the international trade plummeted from $60 billion in 1928 to $25billion in 1938. In 2002 President George Bush imposed a 30% tariff on imported steel, the EU countries, Japan, and China retaliated with threats of $335million worth of tariffs on U.S imports
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