What would be the effects if the United States unilaterally removed tariffs and other restraints on imported products? On the positive side, tariff elimination lowers the price of the affected imports and may lower the price of the competing U.S. good, resulting in economic gains to the U.S. consumer. Lower import prices also decrease the production costs of firms that buy less costly intermediate inputs, such as steel. On the negative side, the lower price to import competing producers, as a result of eliminating the tariff, results in profit reductions; workers become displaced from the domestic industry that loses protection; and the U.S. government loses tax revenue as the result of eliminating the tariff.
In 2011, the U.S. International Trade Commission estimated the annual economic welfare gains from eliminating significant import restraints from their existing levels. The result would have been equivalent to a welfare gain of about $2.6 billion to the U.S.
economy. The largest welfare gain would come from liberalizing trade ethanol, textiles and apparel, and dairy products, as seen in Table 4.6.

What do you think? Should the United States remove all of its tariffs and other restraints on imports?

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TABLE 4.6 Economic Welfare Gains from Liberalization of Significant Import Restraints,* 2015 (millions of dollars) Import-Competing Industry Annual Change in Economic Welfare 1,513 514 223 215 63 16 12 Ethanol Textiles and apparel Dairy Footwear and leather products Tobacco Tuna Costume jewelry *Import tariffs, tariff rate quotas, and import quotas.