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Arguments on why USA's free trade is better than China's protectionism

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Arguments on why USA's free trade is better than China's protectionism

Introduction
The influence of globalization is significant, particularly in the aspect of promoting trade
in various regions around the world. Trade has been relevant in many areas due to the production
of better commodities, increasing job opportunities, higher earnings, and many other benefits.
Countries like the United States and China highly embrace trade, making China one of the
biggest export markets for the U.S. However, these countries have varying perspectives on trade
since the United States believes in free trade and China embraces protectionism trade. There has
been ongoing debate on which type of trade between China and the United States is better. It is
essential to acknowledge that this discussion over protectionism and free trade is complicated,
and there are different opinions about them. However, this paper argues that U.S. free trade is
better than China's protectionism trade because it enhances global competitiveness, diplomatic
relations, economic growth, innovation, job creation, global leadership, influence, and consumer
welfare.
Arguments
Global competitiveness
When American businesses take part in free trade grants, they become more competitive
on an international level. Companies based in the United States and other parts globally can
expand their business and attract more customers by tapping into foreign markets. In today's
global economy, firms always innovate and improve their processes to remain competitive.

When countries engage in free trade, businesses can use each other's capabilities
regarding resources, technology, and expertise. For example, American technology highly relies
on components manufactured abroad (Won et al., 2023). It can strengthen the global economy's
interconnected network and solidify the U.S.'s position as a worldwide leader if people globally
work together.
As a result of free trade agreements, the United States and other international businesses
can grow into new markets while increasing the credibility and popularity of American brands
worldwide. Companies gain from consumers' increased spending, and the U.S. economy gains
global clout.
Diplomatic relations
From a diplomatic perspective, free trade agreements can help bring nations closer
together and promote global stability. Countries' interests extend beyond commerce when they
form economic partnerships. During political or economic turmoil, trade alliances might help
bring about stronger diplomatic collaboration and, eventually, a solution to the difficulties that
have arisen (Kim & Yang, 2022).
The United States has used free trade agreements to fortify diplomatic and economic
relations. Promoting nations to resolve issues through discussion rather than conflict aims to
increase economic interconnection.
Economic growth
The expansion that free trade causes is a major boost to America and other economies.
The removal or reduction of trade barriers, such as tariffs and quotas, benefits American firms by
opening up additional markets for their products. This is the reason why unrestricted trade is
good. An increase in sales is possible when more people, both domestically and internationally,
are aware of a company's offerings. Also, countries may focus on making top-notch goods and
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services because of free trade. The general public and businesses benefit from specialization's
increased efficiency and output.
The United States has long enjoyed the Free Trade Agreement (FTA) advantages. As a
result of trade agreements, international commerce has become much easier to do. The United
States of America, Mexico, and Canada (USMCA) followed NAFTA, which was the North
American Free Trade Agreement that Mexico and the U.S. signed (Ramírez Sánchez & Massa
Roldán, 2020). Greater GDP, greater employment, and closer economic links with other nations
have resulted from the expansion of various industries made possible by these pacts.
Innovation
Innovation and new concepts thrive when products, services, and information can move
freely across borders. Companies are compelled to invest in R&D to preserve a competitive
advantage in today's global marketplace (Yakabuski, 2022). This desire for innovation affects
product design, process efficiency, and technology advancements.
The technology and pharmaceutical industries, among many others, have reaped immense
advantages from free trade. Working with international partners has allowed us to create new
products, exchange cutting-edge research, and learn from each other's best practices (Dent,
2021). Because of their access to people and information worldwide, American sectors can
innovate and adapt faster than their competitors.
Consumer welfare
Customers gain from free trade in several ways; one is that it increases their access to a
wider variety of affordable, high-quality goods and services. As a result of reduced trade
barriers, more competition equals cheaper pricing and more options for consumers (Bromund,
2020). In response to competition from overseas, the domestic manufacturing industry has been
working hard to improve and become more efficient, resulting in lower-priced, higher-quality
products.
As a result of free trade, Americans and other consumers can purchase a larger variety of
goods at lower prices. The fact that American consumers often buy foreign electronics and
clothing at steep discounts rubs salt in the wound. With less spending on food and other
necessities, families can improve their living standards when prices decline.
Job opportunities through Exports
The rise of exports is one way in which the free trade policies of the U.S. have helped
expand the economy and create jobs. As a result of free trade accords, American businesses can
more easily reach customers worldwide.
The demand for American goods typically experiences an enormous upsurge when these
enterprises expand into new areas. There may be a need to build new factories and hire more
people to accommodate the increasing demand in the worldwide market due to this increased
demand, particularly from consumers in other countries (Davies, 2023). The expanded export
prospects of free trade are highly beneficial to the tech, agricultural, and industrial sectors.
Also, there is a tremendous possibility for American firms to experience significant
growth if they export to countries with expanding consumer markets. More manufacturing jobs
became available as a result of this expansion. As output ramps up to meet global demand, more
workers will be required in numerous fields, including production, sales, marketing, logistics,
and production.
Global leadership and influence
The United States has risen as a world economic leader because of its large measure to its
free trade policies. U.S. involvement in several FTAs and IEOs has allowed the U.S. to forge
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partnerships with other countries beyond simple economic cooperation. Strong links formed
through these alliances with partner nations enable the United States to maintain its position as a
global leader.
Diplomatic cooperation can be laid up on top of free trade accords like the USMCA and
others. The U.S. can shape its economic policies according to its ideals and interests by
negotiating and maintaining international agreements. The U.S. can strengthen its hand in
determining the rules of the global economic game by helping to develop uniform trade
standards.
Another advantage of free trade is expanding the United States "soft power," or its
capacity to influence and convince other countries without resorting to armed action. The United
States' dedication to free and fair trade and its massive and profitable consumer market make its
allies much sought after (Chung, 2020). As a result of its soft power, the U.S. can keep its grip
on foreign policy and maintain its position as the world's leading economic power.
Counterarguments and Refutations
Despite the United States free trade being better, some critics argue in favor of China,
noting that their protectionism is better due to the following arguments:
Strategic Planning
Concerning strategic planning, supporters of China's protectionism trade argue that
China's protectionist policies are closely related to its long-term economic plan. The state
intervenes to plan and oversee the growth of essential sectors to provide a cohesive and
organized approach to industrialization. Subsidies and other forms of government aid can be
used to favor some industries over others.
Critics further emphasize that this strategy has been successful, as seen by the rapid
ascent to the top of their respective industries by Chinese I.T. behemoths ZTE and Huawei
(Kapustina et al., 2020). The expansion of Chinese businesses engaged in strategic initiatives,
made possible by protectionist laws, has increased their industrial capacity and sparked
technological innovation. Nevertheless, this point can be refuted because it can promote the
danger of overcapacity, the possibility of innovation destruction, and resource misallocation.
Social stability and job reservation
This argument emphasizes that protecting Chinese jobs and national stability is an often-
stated justification for trade protectionism. The rapid influx of cheaper imports might force many
businesses to lay off workers, but the government can shield some sectors from this tendency.
The Chinese government places a premium on preventing and resolving conflicts to keep calm.
The steel and heavy industrial industries, which are more vulnerable to shifts in global
markets, can benefit from protectionism. Proponents argue that satisfying local employment
levels and minimizing social unrest is worthwhile, while opponents say it would diminish global
efficiency.
Technology transfer
This argument emphasizes that keeping technological transfer and reliance on foreign
technologies at a minimum is central to China's protectionist posture. By mandating joint
ventures in specific industries between international and Chinese enterprises, the program aims
to encourage the transfer of technical know-how. China can increase its control over key
technology by building its capabilities.
In this case, China plans to strengthen its technical sovereignty by encouraging the
development of domestic enterprises and utilizing indigenous technology more frequently. To
become less dependent on other countries for its knowledge, China aspires to become a world
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leader in advanced manufacturing and electronics. Because of this, the issue at hand is more
important than before. Nevertheless, this point can be refuted since there is a possibility of
slower technological advancement and intellectual property concerns related to technology
transfer, which are trade problems.
Strategic Trade Balancing
Some critics argue that the point of China's trade restrictions is to create a surplus. As a
tool for strategic trade management, China utilizes interventions in the currency market to boost
exports and limit imports. As a result of this policy, China has become a major player in the
global economy and has accumulated substantial foreign exchange reserves (Arslan & Cantú,
2019).
In addition, supporters of China's trade surplus say it helps fund important investments
and long-term economic growth, but opponents, including trading partners, are worried. Many
believe that maintaining a positive trade balance is critical to the country's ability to attract
investment and technical expertise. However, this argument can be refuted because of the
possibility of global economic imbalances, the dangers of currency manipulation, and change
toward technological advancement (Cambazoğlu, 2020).
Economic stability
China has instituted protectionist policies to maintain economic stability and shield its
economy from external shocks. The Chinese government has created trade barriers and tariffs to
protect key industries from foreign competition and maintain financial stability. This strategy
would be useful for companies contributing to the nation's security or economic autonomy.
As an example, the Made in China 2025 strategy seeks to enhance China's high-tech
industries by cultivating domestic experts in innovative domains such as artificial intelligence
(A.I.), electric vehicles (E.V.s), and additive manufacturing (AM) through the implementation of
conservative policies (Yang, Gu, Tan, 2023). China can fortify its economy and diversify its
exports by investing in these fields during their development stages. This will make China more
resistant to global uncertainties and reduce its reliance on foreign technology. However, this
argument can be refuted because the measures intended to promote economic stability can lead
to market inefficiencies, dangers of economic nationalism, and focus on quantity over quality.
Conclusion
To conclude, the benefits of free trade in the United States go well beyond the financial
sector. More innovation, better consumer welfare, greater economic growth, diplomatic stability,
and heightened global competitiveness are just a few far-reaching benefits of free trade.
Although globalization has many negative aspects, the United States and its allies worldwide can
reap substantial benefits from carefully crafted free trade agreements.
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References

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