ECONOMIC NATIONALISM

1. Is economic nationalism justified?

Economic nationalism is an ideology that favors state interventionism over other market
mechanisms, containing policies that emphasize domestic control of the economy, labor, and capital
formation, even if this requires the imposition of tariffs and other restrictions on the movement of labor,
goods, and capital. In an era wherein globalization is widely accepted and an ideal strategy towards
success in business which directly affects the economy, we do not think economic nationalism is
justified. Given the circumstances that arise if economic nationalism or protectionism prevails, there
would be a spike of cost in the expenses for goods and services because local manufacturers have to
utilize what their country is offering-- which is limited, and will result in a compromised quality with an
unjustifiably expensive price in the consumers’ end. Another point is that, practicality-wise, some
necessary materials are better outsourced from other countries that offer best quality at a cheaper cost,
which applies to importing from countries with specialization of certain products needed, hence, time
and cost-efficient. Customers in a country that practices economic nationalism would have to carry the
burden of paying higher prices, which is not essentially better for the nation as a whole. Economic
relations and diplomatic ties with other countries, especially with those developed ones, must be
preserved if we think for the long term benefits.

The only industries that need protection are those that are not globally competitive. There is no
need for a whole nation to practice economic nationalism for many industries will also suffer in the long
run since sustainability would be of question. Successful and developed countries such as Japan, South
Korea, Germany, and China are all known to have participated significantly in international trade. Lastly,
not all countries are fortunate enough to possess a variety of abundant resources and most countries at
the moment are interdependent with one another when it comes to trade, thus, have already embraced
globalization. Having access to a wide array of resources with lesser cost is necessary for business to be
competitive and with economic nationalism taking place, they would most likely lead to only settling for
what is available instead of what suits best.

2. Is the Smoot-Hawley plan better or worse than “Buy American? “Buy Spanish? Or “British jobs for
British workers? Explain fully.

The Smoot-Hawley Tariff Act was passed to strengthen the economy of the United States by keeping
jobs only for their citizens. It discouraged U.S. consumers from purchasing goods from other countries. It
may differ in form from Buy American, Buy Spanish, or British jobs for British workers but the global
implications are still the same regarding its possible outcome. It caused the retaliation that the rest of
the world inevitably enacted. Other countries raised tariffs on exports from the United States and also to
other nations. Eventually, the situation infinitely got worse as it caused a trading war between their
trading allies. The Smooth-Hawley plan only worsened the Great Depression during that time and did
not help to raise their economy. Moreover, it caused the other countries to also raised their tariff as a
sort of revenge.
It is important to take note that even if the Smoot-Hawley Tariff act is a tariff barrier, while Buy
American, Buy Spanish or British jobs for British workers is a non-tariff barrier, both impose restrictions
on imports and labor flow across the globe. They are created for the same reason – protection and
raising their domestic economy. It did benefit their economy, but only for a short time. It only brought
heavy consequences to pay for the long term. Like how the American companies, as well as American
employees working for foreign firms, are being harmed as they need bigger costs and offered limited
options. Therefore, the Smooth-Hawley is not a better plan nor worse than Buy American, Buy Spanish
or British jobs for British workers as it will only result in the same thing which is never good to the
United States and other countries.