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International Trading Operations

The trade policy of the United States heavily depends on the way that Obama relates to the economic happenings. Many have asked whether he will respond with Clinton-like policies or he will adopt the "Jimmy Carter" approach. Overall, these do not actually matter because, as his predecessors were, he is bound to react to issues in a similar manner. Erixon suggests that the trend seems to divert from the 1930"s style of protectionism and instead favors the 1970"s style of drawing subtle economic policies that will affect them when it comes to global integration. This means a strong push for domestic regulatory policies for regulating the new capital market.

There are some economic consequences and to shed a light on the mistaken notion that protectionism saves jobs, it is quite to the contrary. Protectionism may save jobs in a certain industry but at the risk of destroying opportunity in another situation. Most people would ask why the government would go for protectionism if the benefits were minimal. It is because the benefits are large scale as such. They are concentrated over the entire labor force while the cost is spread over the entire consumer market.

Protectionism happens to be the opposite of free trade. Instead of encouraging improved growth, it leads to reduced economic growth. It reduces the trade among the nations that impedes growth that enriches the consumers as well as the producers of goods and services. A new tariff for goods will make the consumers pay more for the services while the producer will get less income because they sell fewer goods than usual. In other words, trade protectionism is a losing policy. The ideal policy that supports the argument is the China policy portrays a great deal of protectionism thus offering the unbalanced trade on both sides.

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