A Trade War Will Reduce American Exports Too
On the eve of the next expected escalation of President Donald Trump’s trade war with the world, consider the plight of America’s orange juice producers.
America exports a lot of orange juice to Canada—because we have an obvious comparative advantage when it comes to growing citrus fruit. In 2023, Canada bought $281 million worth of fruit juice from the United States.
In Trump’s flawed way of looking at trade, that would mean America is somehow ripping Canada off, but this is actually a great deal for everyone involved. Canadians get orange juice that they can’t produce on their own. America’s orange growers and juicemakers get a larger market for sales. And lots of other people on both sides of the border make a buck by hauling, warehousing, stocking, and selling all that juice.
A trade war means all those people lose—the Canadians and the Americans. Orange juice is one of the products Canada has included in its package of retaliatory tariffs, and that’s one of the reasons why orange juice prices have declined recently.
Much of the discussion about Trump’s tariff proposals focuses on the impact they will have on imports. That’s understandable since the most immediate and direct effect of tariffs is to raise prices for American businesses and consumers bu
Article from Reason.com
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