Is a 'Buy American' Policy Good for the U.S. Economy?

Washington DC February 20, 2009; The AIADA newsletter reported that the Detroit Free Press occasionally offers readers the opportunity to pose a question to a local economist. The week's question was: We're seeing more "Buy American" sentiment lately, both among automakers in Detroit and among lawmakers in Washington, D.C. Is a "Buy American" policy good for our economy and why or why not?

This week's answer comes from Dr. Timothy G. Nash, vice president of graduate and specialty programs at Northwood University in Midland, MI. Nash explains that a "buy American" policy is not good for our economy.

It is important to recall the factors surrounding the Great Depression when similar protectionary measures and tariffs were instituted, greatly reducing American exports. We must remember that trade and protectionism are two-way streets, with intended and unintended consequences.

Free trade has afforded American brands the opportunity to place products on store shelves across the globe. International competition strengthens American products and keeps all companies better in touch with global consumer needs.

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