March 1, 2013

Though it may seem counterintuitive, imports are vital to U.S. manufacturing, explains Heritage Foundation economist Terry Miller.

Citing a new report by the St.Louis Federal Reserve Miller says:

Intermediate goods imports and capital goods imports are the lifeblood of U.S. manufacturing. Without them, manufacturing output is impossible. In fact, goods imports account for a far greater share of U.S. manufacturing value added than do exports.

Statists often favor subsidizing exports as a way to bolster the economy, but Miller says this kind of intervention can dangerous. “Export promotion is misguided at best,” he says, “and seriously harmful if policies include restrictions on imports or manipulation of currency to cheapen the value of the dollar.”

To boost the manufacturing sector, Miller suggests the Obama administration remove government restrictions on commerce instead of focusing solely on exports:

Exports are not the path to manufacturing success. Foreign trade helps build the U.S. economy more when we find new markets in which to buy raw materials and capital goods than when we push for new markets in which to sell the things we make.

Learn more about the importance of economic freedom to economic growth in Heritage’s Index of Economic Freedom. 

Do you think economic freedom leads to growth?

Comments (6)

Robert Peacock - March 5, 2013

Certainly!!!

Jerry - March 5, 2013

The right solution to our economic predicament is to launch
an informed State effort to revive and revitalize the proper use of
“nullification”. Study the Founder position, consult Publius
Huldah, and carefully study the work of Thomas Woods, Jr.. Very
enlightening and sound and logical.

Jacques Bakke - March 6, 2013

Economic Freedom will be accelerated when we get rid of the Direct Taxation System and the Federal Reserve. The only fair way to tax Americans is with one tax and one tax only: A Consumption Tax. The banking system must change to 100% Reserve Banking. Both of these, Direct Taxation and the misnomered Federal Reserve, which were given birth in 1913, have been the major part of the yoke placed on America for 100 years. Both too of which are not recommended by the founding fathers. If they go this country will flourish like no one can even dream!

George Warren - March 7, 2013

Over the years of President George W. Bush (2001-2008) and President B.Obama (2009 – 2013 to present) WE THE PEOPLE of UNITED STATES have seen a lot of ILLUSTRATIONS of Federal Budgets in Pictures, but, did it do anything to really cut Federal Spending??
I’m saddened to write (from: Conservative Ideas Need a New Message, by Jim DeMint) : “November, 2012 election results and exit polls suggest that a majority of Americans agree that government does too much yet still voted for more of it. Mr.DeMint’s article states the election taught conservatives that we can no longer entrust political parties to carry our message”.
Sincerely, GEORGE

Arlin R. Johnson, Jr. - March 8, 2013

Both Democrat and Republican parties have cranked out regulation after regulation on anything that moves, and like Pres. Reagan said if it stops moving subsidize it.
Washington politicians need to get off the back of free enterprise. Flax tax, and cutting death dealing regulations are needed badly! We are broke – thus zero foreign aid. Washington should know by now you can’t buy friends.

Holly Chapo - March 11, 2013

How else did the United States of America become so outstandingly prosperous? Our Founders got it, the American people got it and we Conservatives get it today. Freedom works!

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