Thanks, Louis, for putting forth your perspective. Regarding the tariffs on dairy, from what I could gather,
- The high “270 percent” rates are only applicable on dairy products that exceed the quota limits.[1]
- On an individual level, yes, they do hurt American farmers. And yet, the United States, as a country, was in a trade surplus with Canada. Why? Dairy only amounts to 0.1 percent of America’s trade with Canada. Also, another reason farmers are getting hurt is because America happens to produce a great surplus of dairy products, more than people can consume.[2]
- Even then, under the Trans-Pacific Partnership, Canada had agreed to phase out its “supply chain management system” that justifies these high tariffs. But when the U.S. opted out, Canada, along with other countries, took back its concession.[3]
- Meanwhile, America, too subsidizes its dairy industry. Subsidies are a form of trade barriers, as well, but just not as visible or as explicit as tariffs.[4]
- There’s a lot of internal politics going on in both countries, which makes this debate somewhat redundant.[5]
I hope the general public sees this, too, instead of forming a conclusion based on a single tweet.
Also, while the U.S. is China’s top exports partner, it would be careless to say that “Americans do not really need any single market” when China is the United States’ top trading partner and Canada is its number one export partner and Mexico second (and China third). Together, they make up around 45 percent of America’s total trade.
Of course, there are also other debates going on regarding China, which I hope to address in my next article.