Protectionism and the free market

Photo by Mike Licht



Something that can often be heard coming from members of both major parties is the populist phrase: “Buy American.”

Small Business Saturday was last weekend, but all deadlines are off in this pandemic year, and small businesses have been hit hard this year by local mandates. However, one may observe duopoly leadership taking full advantage of this unofficial holiday. In order to camouflage the greater implications of their agenda, officials at both the local and national levels will often elect to tug at the heartstrings of a populace that is perhaps oblivious and unsuspecting, yet otherwise patriotic. By invoking emotions, facts and the true record may be effectively concealed, or at least temporarily disregarded, replaced by “feel-good” actions–actions which, if broad enough, can lead to dangerous legislation.

Now, there is absolutely nothing wrong with a sovereign individual choosing to put his or her money wherever he or she damn well pleases. As an adult, I reserve the right to determine for myself where I shall invest the fruits of my labor, and I expect nothing less to be extended to you. Do not think, either, that I am against anyone’s choice to support small businesses, rather than the big-block chain stores. Quite the contrary: it is this very freedom which I endeavor to protect. 

I would humbly ask of you, the reader, to kindly indulge me in giving an example of such curbing of your freedom, an example that came to mind recently as I shopped for my next motorcycle. 

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In my life, I have had the opportunity to own several motorcycles. Up until a near-tragic accident last year involving me and an SUV that ran a stop sign, the one I most recently possessed was a Harley-Davidson model, of the Ultra-Classic variety. This model had served me well in my numerous travels across the state, and I considered it an appropriate upgrade from previous models.

Harley is an American brand and has been in the news from time to time over the past couple of years as it came under fire from the Trump administration. More specifically, from the president himself. Free trade, fair trade, tariffs, currency wars, jobs, manufacturing, warehouse locations, no doubt you have heard all these. You have probably already formed your opinion of these exchanges, so I will not waste anyone’s time in trying to manipulate that here. 

Let us instead go back 36 years, to 1983. President Ronald Reagan signed a protectionism act, raising tariffs on foreign motorcycle companies from 4.4 percent to 49.4 percent, a staggering 1000% increase. Passed in the name of saving American jobs, the act was billed as shoring up failing sales from the domestic motorcycle giant and curbing competition. This artificial manipulation of the free market, while seemingly granting Harley-Davidson the breathing room they had lobbied for, did nothing to solve the original problem that had led up to the issues they were having. 

In the marketplace, the ultimate goal of a business owner has to be to satisfy his customers. The decline of sales experienced by Harley had less to do with the rise of Japanese motorcycle companies than with falling consumer confidence in the American one. If the public is presented with multiple options, some will take the cheapest one available, but the majority will always opt for the best value. Harley simply wasn’t producing an efficient product, compared to what Honda and Suzuki and others were offering. 

1983 saw major legislation passed in Washington, D.C., but it also signaled a change in operations in Milwaukee, Wisconsin. 

Quality control expanded. A re-tooling of the engine took place. All models started going through extensive scrutiny and field tests before being offered for sale. Engineering design was revamped. The result was more power, better fuel economy, and less down time for expensive repairs.

From these efforts, almost immediately, sales spiked. It wasn’t long before the CEO of the company made a formal request to the president to rescind the protection order, stating, “Harley-Davidson no longer needs an unfair advantage to sell its product.” The motorcycle company was once again meeting the expectations of the American people. 

The tariff act was permitted to expire, and business, spurred by competition, thrived.

The motorcycle I had was a direct result of such competition, and not from protectionism. Tomorrow, I can go test-ride a Honda, a Suzuki, even a BMW or Yamaha, among a slew of others, all competing for my attention and dollars. I will choose to own another Harley. Why? Because it suits my needs and is the best fit for what I want. And I’m thankful for so many options, because without them, whichever model I wind up picking would have no incentive to be different. 

So when you hear “Buy American,” what you really should be thinking is, “Buy the Best Product for You.” 

We should encourage competition. And shun protectionism.

Because if we don’t, American businesses will ultimately suffer the consequences of a disinterested population. And I suppose that is the real blow to the economy.

Chris Rose II is currently elected on the Rules Committee for the Libertarian Party of Florida

The opinions expressed by letter or opinion writers are their own and do not necessarily represent the views of AlachuaChronicle.com.