[Excerpt] This is the seventh update of The Economic Effects of Significant U.S. Import Restraints. Since the first of these studies was published nearly 20 years ago, U.S. tariff rates have fallen, nontariff measures on imports have been removed, and trade has expanded markedly. This period has also seen increasing U.S. integration into global supply chains, the subject of a special topic in this report.
The United States is one of the world’s most open economies. In 2010, the average U.S. tariff on all goods remained near its historic low of 1.3 percent, on an import-weighted basis, essentially unchanged from the previous update in 2009. Nonetheless, significant restraints on trade remain in certain sectors. The U.S. International Trade Commission (Commission) estimates that U.S. economic welfare, as defined by total public and private consumption, would increase by about $2.6 billion annually by 2015 if the United States unilaterally ended (“liberalized”) all significant restraints quantified in this report. Exports would expand by $9.0 billion and imports by $11.5 billion. These changes would result from removing import barriers in the following sectors: sugar, ethanol, canned tuna, dairy products, tobacco, textiles and apparel, and other high-tariff manufacturing sectors.
As in previous updates, the simulations presented in this report measure the effects of unilateral liberalization of U.S. import restraints (i.e., the simulations assume that U.S. trading partners do not engage in any reciprocal liberalization). However, the effects on the U.S. economy can differ significantly when both the United States and its trading partners engage in reciprocal liberalization.