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Do you think the reduction or elimination of tariffs and notariff barriers between the U.S. and the EU through the Trans-Atlantic Trade and Investment Partnership will increase demand for U.S. goods and services in Europe and make european goods and services cheaper for Americans? In the face of a global recession is it wise for nations to begin raising tariffs and increasing subsidies to domestic producers?  Why or why not?

This is first response of my classmate:

It is possible that the reduction or elimination of tariffs and notariff barriers between the U.S. and the EU countries through the Trans-Atlantic Trade and Investment Partnership can make european goods and services cheaper for Americans consumers and increase more demand for U.S. goods and services in Europe nations. The issue here is not the trade barrier but there are other issues including comparative advantage, currency rates and regulations. I have many friends in Europe who were so interested in demanding US goods but nowadays, it became harder for them to buy goods from the United States because the dollar exchange is high over there. I think european goods and services will become cheaper for Americans because of the elimination of tariffs barriers between the U.S. and the EU countries. 

When it comes to a global recession, I don't think it wise for nations to begin raising tariffs during recession because it will make the recession worse. I think increasing subsidies to domestic producers is not a bad idea but you have to export your goods and services. Therefore, it will be harder for a country to export goods/services if tariff is raised during global recession.

This is second response of my other classmate:

I do think that the elimination of tariffs will increase US exports to Europe and make European products cheaper in the US. This is because the elimination of tariffs would allow the US and Europe to specialize according to comparative advantage. Therefore, Europeans will be able to obtain products that the US has a comparative advantage in by trading with the US because the US has a lower opportunity cost in those products. Therefore, exports to Europe should increase. Likewise, products from Europe should be less expensive in the US.  This is because the US will be able to obtain products at a lower opportunity cost if we trade with Europe and import things in which they have a comparative advantage. Therefore, I would expect the level of trade to increase and prices for imported products to fall in both the US and the EU.

I do not think it is wise to implement tariffs when a country goes into recession. Ultimately, I think this will make the recession worse. Restricting imports will also restrict exports. This is because exports are paid for with the dollars that foreigners obtain when we import products from them. Therefore, reducing imports will also reduce exports, and this will depress demand and make the recession deeper. Additionally, it will result in higher prices as consumers are forced to buy domestically produced goods that have higher costs. This will further reduce living standards, which are already falling as a result of the recession. Therefore, I do not think it is wise to implement tariffs during a recession.