With consumer price inflation (CPI) running at 6.8% as of November 2021, many importers are trying to use inflation as an excuse for repealing the tariffs enacted by former President Donald Trump and continued by President Joe Biden. This is special interest pleading and bad economics. A close look at the state of the U.S.…
Global capital flows are the driving force behind the rise of the dollar, which rose 3.9% in 2021. In the last ten years, the dollar is up 25.5%[1]. The US attracts capital for many reasons, including tax avoidance, speculative trading, and a relatively small amount of genuine investment. The deregulation of financial markets in the…
WASHINGTON — The Coalition for a Prosperous America (CPA) today announced that the U.S. Private Sector Job Quality Index (JQI) fell slightly to 81.4 in November, down 0.85% from the previous month. The decline in the JQI was driven by the growth in low-wage jobs in the medical equipment manufacturing and motor vehicle dealership sector,…
U.S. Trade Policy: Over Half a Century of Unreciprocated Tariff Cuts By Amanda Mayoral, CPA Economist Summary Points: The US held high tariff rates from 1816 until the middle of the 20th century The US then cut tariffs more than most countries, often unilaterally, without also requiring tariff reductions by others Today, the US has…
A new paper by the “China Shock” economists adds to the growing mountain of literature documenting the costs of free trade events to the U.S. economy over the past half century. Their new paper, On the Persistence of the China Shock, shows that increased unemployment, protracted withdrawal from the labor force, and other social ills…
The United States bike industry is in the midst of an unprecedented boom, triggered by the COVID pandemic. Bike sales rose sharply in the spring of 2020, as gyms, yoga studios and other exercise centers shut down and Americans sought outdoor activities like biking, a relatively safe form of exercise. In 2021, the sales surge…
Background When inflation threatens America’s stability and economic growth, the Fed raises the Federal Funds Rate (FFR). This reduces domestic demand for borrowed funds, and that reduces the growth of domestic money in circulation and thus the rate of inflation. This approach worked reasonably well from the 1930s when the FFR became an official policy…
Not All Tariffs Are the Same: A Case to Consider Optimal Tariff Policy By Amanda Mayoral, CPA Economist Summary Points: Despite popular misconception, economic theory has long suggested that tariffs can benefit a country, particularly one like the US. The most advantageous tariffs are optimal tariffs. This is because optimal tariffs balance the…
CPA’s report, titled “Generic Drug Shortages and How a Race to the Bottom in Price has Upended 30 years of Hatch-Waxman,” details how a loophole in the Hatch-Waxman Act has led to generic drug shortages in the U.S., offshoring of America’s domestic production of generic pharmaceuticals to China and India, and price gouging by foreign…
Summary points: The import price of steel fell in the period following the 2018 imposition of a 25% steel tariff, an indicator that steel tariffs were not passed entirely onto consumers. Steel tariffs did not lead to a proportional rise in consumer prices of steel-intensive goods, such as automobiles. In many instances, firms will internalize…
