What is open trade?
Open trade is an imported that has no tariff. In other words, it's an imported good or service that hasn't been taxed.
solutions to jobs being destroyed by open trade
The solution to the destruction of jobs by open trade include re-introducing tariffs on the products that we export. Tariffs work in a way that protects Australian industries from closure or unemployment. This tax will help us as we cannot compete with countries that use cheap labour, under awful working conditions. They also cause competition between domestic industries which maintains the number of employees and provides better quality in what they produce. The solution also involves establishing protection policies including:
The prevention of dumping: dumping is when foreign producers export their products at a cheaper price than the cost they would sell it at domestically. This is used to get rid of surplus stocks or to increase the market share of the domestic economy. Over a period of time, dumping will force efficient domestic industries in Australia out of business, causing a decrease in productivity and loss of jobs due to an unfair competitive advantage.
Self-sufficiency: this means to decrease our dependence on imports and to increase our self-sufficiency in essential industries such as communication, transportation and defence. Domestic industries should be shielded from cheap imports to improve domestic demand and employment.
The prevention of dumping: dumping is when foreign producers export their products at a cheaper price than the cost they would sell it at domestically. This is used to get rid of surplus stocks or to increase the market share of the domestic economy. Over a period of time, dumping will force efficient domestic industries in Australia out of business, causing a decrease in productivity and loss of jobs due to an unfair competitive advantage.
Self-sufficiency: this means to decrease our dependence on imports and to increase our self-sufficiency in essential industries such as communication, transportation and defence. Domestic industries should be shielded from cheap imports to improve domestic demand and employment.
recent instances of unemployment by open trade
Article 2
BHP flags more iron ore job cuts
http://www.theaustralian.com.au/business/latest/bhp-flags-more-iron-ore-job-cuts/story-e6frg90f-1226975512347
Article 3
Toyota to close: Thousands of jobs to go as carmaker closes Australian plants by 2017
http://www.abc.net.au/news/2014-02-10/toyota-to-pull-out-of-australia-sources/5250114
BHP flags more iron ore job cuts
- by: Dow Jones newswires
- July 02, 2014 6:00PM
http://www.theaustralian.com.au/business/latest/bhp-flags-more-iron-ore-job-cuts/story-e6frg90f-1226975512347
Article 3
Toyota to close: Thousands of jobs to go as carmaker closes Australian plants by 2017
- By Emma Griffiths, political correspondent
- February 12, 2014 11:39pm
http://www.abc.net.au/news/2014-02-10/toyota-to-pull-out-of-australia-sources/5250114
do we support the notion of open trade?
Yes, we do support the notion of open trade, as it decreases the price of iron ore exports, which makes importing from Australia more attractable to other countries. If we place tariffs on the products that we export, the demand of the products will be reduced and businesses will be forced to close. Protection will eventually lead to a decrease in levels of domestic output, falling incomes and a reduction in economic growth.
If a policy such as self efficiency is introduced, benefits such as higher living standards that are achieved with free trade will be lost. Limiting free trade negatively changes the allocation of resources from the more efficient industries to less efficient industries. Even if employment is conserved in these protected industries this way, it is still at the expense of the much more efficient aspects of the economy. An increase in Australia's overall employment levels was shown (especially in the efficient exporting industries) through the effects of free trade. These are the reasons why we support the notion of open trade.
If a policy such as self efficiency is introduced, benefits such as higher living standards that are achieved with free trade will be lost. Limiting free trade negatively changes the allocation of resources from the more efficient industries to less efficient industries. Even if employment is conserved in these protected industries this way, it is still at the expense of the much more efficient aspects of the economy. An increase in Australia's overall employment levels was shown (especially in the efficient exporting industries) through the effects of free trade. These are the reasons why we support the notion of open trade.