What If You Had to Buy American?

5/12/2011 3:31 PM ET

By Katherine Reynolds Lewis

It might be supremely patriotic to stop purchasing imports, but the consequences for US consumers and the economy would be devastating.

Related topics: savings, budgeting, spending, shopping, retail

Legions of patriotic Americans look for "made in USA" stickers before buying products, out of a desire to support the country's economy.

But what if we all were restricted to purchasing only those goods that were made in America?

Our homes would be stripped virtually bare of telephones, televisions, toasters and other electronics, and many of our favorite foods and toys would be gone, too. Say goodbye to your coffee or tea, and forget about slicing bananas into your breakfast cereal -- all three would become prohibitively expensive if we relied on only Hawaii to grow tropical crops.

Products made in USA

We'd have to trash our beloved Apple products because the iPod, iPad and MacBook aren't made in the U.S. Gasoline would double or triple in price, given that we now import more than 60% of our oil. And you couldn't propose to your true love with a diamond ring: There are no working diamond mines in the U.S.

Moreover, a complete end to imports would actually hurt the U.S. economy, because consumers and domestic companies would lose access to cheap goods. Trade protections, whether through tariffs or quotas, cost the economy roughly $2 for every $1 in additional profit for domestic producers, said Mark Perry, an economics professor at the University of Michigan-Flint and a visiting scholar at the American Enterprise Institute, a conservative think tank.

"If we restricted trade to just the 50 states, what would happen immediately -- and would increase over time -- would be a huge reduction in our standard of living, because we wouldn't have access to the cheap goods we get from other countries," Perry said. "We also wouldn't have any export markets, so companies like Caterpillar and Microsoft would have a huge reduction in sales and workforce." (Microsoft is the publisher of MSN Money.)

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So what do we make of heartfelt pleas to save U.S. manufacturing by buying American, or the many websites (see one here) that catalog U.S. sources for an array of products? Or the Buy American Act, which curbs government purchases of products that are made overseas?

Do such efforts actually hurt the country they're trying to help?

The argument for buying American

Marc Kruskol, 53, a publicist based in Palmdale, Calif., goes out of his way to purchase products that are made in the U.S. because of his concern over the decline in manufacturing employment.

"I truly believe that we could go a long way towards fixing the economy if we would just put people to work making things in this country that are made in other places," said Kruskol, who spends hours scouring made-in-America websites or visiting brick-and-mortar stores in search of U.S. products.

He recently spent $10 on a pair of salad tongs made in America, which he tracked down in a restaurant supply store, after rejecting 99-cent foreign-made tongs. And he was happy to spend $650 on a domestically produced barbecue grill rather than a $450 imported one, just to support his countrymen.

But financial experts say that it's best for America if you buy the cheapest product you can find without sacrificing quality. Their explanation rests on the concept of efficient manufacturing. An efficient producer creates the most valuable goods with the least possible expense, selling those items at lower prices than competitors who are less efficient. A country benefits when its manufacturers become more efficient.

Continued: The complex manufacturing questionSingle page12Next >RELATED ARTICLESThe 50/30/20 budget fix - 1 - budgets & spending - MSN MoneyBudget deficit on track to exceed $1 trillion ...Kan. legislative negotiators agree on $14B budget: Associated ...What if you had to buy American? - 1 - retail ...April budget gap narrows sharply from year ago ...50-30-20 budget: A simple spending breakdown - MSN MoneyVIDEO ON MSN MONEY/* /**/ var scp_UserRating=-1; down_arrow_hover= new Image(); down_arrow_hover.src = 'http://blu.stc.s-msn.com/br/scp/css/15/decoration/toolbar/rating/down_hover.gif'; down_arrow_normal= new Image(); down_arrow_normal.src = 'http://blu.stc.s-msn.com/br/scp/css/15/decoration/toolbar/rating/down_normal.gif'; up_arrow_hover= new Image(); up_arrow_hover.src = 'http://blu.stc.s-msn.com/br/scp/css/15/decoration/toolbar/rating/up_hover.gif'; up_arrow_normal= new Image(); up_arrow_normal.src = 'http://blu.stc.s-msn.com/br/scp/css/15/decoration/toolbar/rating/up_normal.gif'; var scp_thankyoutext = 'Thank you!'; var scp_thankyoualttext = 'You have voted on this'; var scp_votestext = '{0} votes'; var scp_votescount = 17; var scp_errmsg = 'Errors occured while saving your rating. 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This article is laughable...... service sector? what/where is that? Didn't they outsource that too?

Perhaps the writer is trying to encourage us to continue to be the 'throw away' society that we have become and are trying to change.

We have been Walmarted..... hence the cheap stuff that breaks by time you get it home..... spent 40 dollars on one of those battery powered stick vacs..... utter waste of money as it is now broken and not even 3 months old. Guess where it was made?

We need to bring manufacturing back to this country, and we need to buy more American made products if possible.

At least the guy who spent all that money on the American made grill is enjoying his purchase which no doubt will last for several years. Of course he could have put the money in the bank and watch it disappear in bank fees..... LOL

    0    0ReportSpamkartfisch15 minutes agothis is a after the fact situation , the fact is the rich, greedy, fat cat, capitalists have given away all the manufacturing jobs that would have alowed the us consumer to buy US made goods,  due to their greed. and the goverment has backed them up in this all the way by allowing this to happen, with the global new world order.     1    0ReportSpamchristine59 minutes agoSeriously, who exactly were the financial experts that wrote this article, those with an overseas manufacturing company interest? What a load of garbage they're trying to feed us! BUY AMERICAN! Keep your money here in the USA!     1    2ReportSpamJennyJ8821 hour agoI am a 28-years lady ,beautiful and mature . Now I am seeking a good man who can give me real love , my friends told me a nice place ...MillionaireFriends.C​oM - it's the most effective site in the world to connect with, date and marry successful, beautiful people!     1    1ReportSpamNODADDYDONT_DUKE1 hour agoi don't mind buying american when i can ( item is even made in america ) other wise i look elsewhere just to avoid china stuff, for example i buy my kids toys from this neat brand that's german made in germany, stuff like my shoes i bought 4 pairs some time ago they are still good with life time warranty Made in england ( dr. martins ) as for clothing i try my hardest to buy from few levi and hanes plants in USA i also don't mind buying from canada since they are paid almost the same as us americans so american company don't outsource our labor to canada. So bottom line is i agree with other people not to end all global trade but we should try to buy more american and end things like NAFTA along with taxing imported products that come in like 15% trust me china and india tax the hell out of american imports they get just so people will not buy american i mean its sad when even things like my beer ( budweiser ) get bought out by foreign companies       1    0ReportSpamP.O. Carl5 hours agoMark Anthony 57:  I agree, better quality here.  But, see where the parts are made for that American car.  Most GM cars are made in Canada.  And every light bulb, piece of wire, switches, cd player, speakers, knobs, brake rotors, wheel bearings, and bolts and nuts are made in China.  It is the same for most all car brands, even BMW and other high end cars.  I don't know what consumers can do, I think it is just too late.  Our children and grandchildren will never gain back what has been lost.     2    1ReportSpamMark Anthony 576 hours agoThe article is not practical, trade is important, been going on for thousands of years. The spread is not that far off from US goods to foreign, salad tongs $3-$4 in the US and $.99 from China that will last for six months where the US one will last 4-5 years, do the math ! American cars are better today then japanese, hyundai cars a cheaper but wait until you trade them in they will be worthless. It is best to buy American when you can !     5    3ReportSpamP.O. Carl6 hours ago

I don't believe that people want to do away with all imports, but we need to bring back some manufacturing here.  The cheap goods coming in from overseas is no longer cheap and the price will continue to go up as China's inflation goes up.  What will we do when they are very expensive, and we don't have a choice because nothing is made here?  Almost everything GE manufactures is made in China, that is how they get out of paying income tax.  I bought a Twixt coconut candy bar the other day and saw that it was made in Russia!  What is going on? 

 

P.S.  To the people in the Wall Street bubble, our standard of living has been going down for some time! 

    3    0ReportSpamsr0343_67adljdogj7 hours ago"If we restricted trade to just the 50 states, what would happen immediately -- and would increase over time -- would be a huge reduction in our standard of living, because we wouldn't have access to the cheap goods we get from other countries," Perry said. Hasn't global trade led to a reduction in our standard of living? The article ignores the problems associated with global trade, such as increased pollution, increased competition for petroleum from China and India, GHG emissions, ocean garbage gyres, etc. As we begin the slide down the backside of Hubbert's curve, we will be forced to manufacture locally.     6    1ReportSpamkc brewer7 hours ago

agree with rimrock, stupid article.  in their website survey, aaii thinks msn is one the top three comprehensive investment web sites.  i totally disagree, i see a parade of lazily written articles that contain very little analysis or new information.  i'm not coming back.    

    3    3ReportSpamRimRock9 hours agoThis has got to be about the stupidest article on this subject I have ever saw! No one is saying "hey, let's buy strictly Made in USA products"! What we are saying is let's bring back the industries and jobs, that have been shipped overseas. I would rather have the "choice", instead of walking into a store that carries nothing but "Made in China"!!     17    1ReportSpamjohnny5229 hours agoI don't see anything wrong by creating jobs for our country men and women and get them off welfare!!     12    2ReportSpamAdd a commentReportPlease help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. 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So what do we make of heartfelt pleas to save U.S. manufacturing by buying American, or the many websites (see one here) that catalog U.S. sources for an array of products? Or the Buy American Act, which curbs government purchases of products that are made overseas?

Do such efforts actually hurt the country they're trying to help?

Marc Kruskol, 53, a publicist based in Palmdale, Calif., goes out of his way to purchase products that are made in the U.S. because of his concern over the decline in manufacturing employment.

"I truly believe that we could go a long way towards fixing the economy if we would just put people to work making things in this country that are made in other places," said Kruskol, who spends hours scouring made-in-America websites or visiting brick-and-mortar stores in search of U.S. products.

He recently spent $10 on a pair of salad tongs made in America, which he tracked down in a restaurant supply store, after rejecting 99-cent foreign-made tongs. And he was happy to spend $650 on a domestically produced barbecue grill rather than a $450 imported one, just to support his countrymen.

But financial experts say that it's best for America if you buy the cheapest product you can find without sacrificing quality. Their explanation rests on the concept of efficient manufacturing. An efficient producer creates the most valuable goods with the least possible expense, selling those items at lower prices than competitors who are less efficient. A country benefits when its manufacturers become more efficient.

This article is laughable...... service sector? what/where is that? Didn't they outsource that too?

Perhaps the writer is trying to encourage us to continue to be the 'throw away' society that we have become and are trying to change.

We have been Walmarted..... hence the cheap stuff that breaks by time you get it home..... spent 40 dollars on one of those battery powered stick vacs..... utter waste of money as it is now broken and not even 3 months old. Guess where it was made?

We need to bring manufacturing back to this country, and we need to buy more American made products if possible.

At least the guy who spent all that money on the American made grill is enjoying his purchase which no doubt will last for several years. Of course he could have put the money in the bank and watch it disappear in bank fees..... LOL

I don't believe that people want to do away with all imports, but we need to bring back some manufacturing here.  The cheap goods coming in from overseas is no longer cheap and the price will continue to go up as China's inflation goes up.  What will we do when they are very expensive, and we don't have a choice because nothing is made here?  Almost everything GE manufactures is made in China, that is how they get out of paying income tax.  I bought a Twixt coconut candy bar the other day and saw that it was made in Russia!  What is going on? 

 

P.S.  To the people in the Wall Street bubble, our standard of living has been going down for some time! 

agree with rimrock, stupid article.  in their website survey, aaii thinks msn is one the top three comprehensive investment web sites.  i totally disagree, i see a parade of lazily written articles that contain very little analysis or new information.  i'm not coming back.    

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Play with the factors that affect the size of your stash.

An easily accessible stash of cash is great when you're faced with unexpected bills or events. But you need more than that.

Doing business when you travel can grant you a tax break on your journey, but make sure to document everything.

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Bizarre world records

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