The Myth of Free Trade: How Free Trade Policies Impact the US Economy | Economic Analysis & Political Debate | For Students, Researchers & Policy Makers

These days most countries, are being pushed into accepting a tax on the use of energy. This is at a time when the world economy is straight jacketed in a recession. Is their another solution? Yes their is. America was once a great economic power, it was unparalleled in wealth and industry.When America had no income tax, or a low income tax. Tariffs (a tax on imports were high). High tariffs meant, less tax on income, higher prices because of lack of competition, but with higher prices, high wages, cause of lack of competition. When tariffs were low, tax on income would be raised, prices would have to stay low to compete with third world countries, and because prices on domestic goods are lower, than wages to workers are also lower.Ravi Batra uses statistical data to show, that yes tariffs do raise prices and wages, but because of the money raised from Tariffs, therefore income tax can be lowered, which means people have more money to pay higher prices. And from higher prices, employers can raise wages. His argument is that higher tariffs, with low income tax, is good. And that America grew in wealth while this was the case.International trade includes intertrade. When you buy a car, every part of the car is assembled in a different country, and this creates a lot of international pollution. At least half of international trade is intertrade. His main arguement is that if we had tariffs, this intertrade would stop, and we'de only buy products that have a distinct price advantage. We would again buy cars that were completely made in one country.His main motive in the last chapter is for the environment. 31% of pollution is caused by international trade. And at least half of this is intertrade. So, we don't need an energy tax. We've had this pollution problem start in the 70s when we cut tariffs. Even Al Gore shows that it was in the 70s that the pollution problem started.I'm not saying that I believe or don't believe in global warming. I'm just saying if it is real we don't need this extra tax. We just need to do something about intertrade.