During the 1960s, U.S. steel firms argued they needed tariff protection because Germany and Japan were using new mills to make steel since their old mills were destroyed in World War II. Essentially, this argument is a form of the
A) infant-industry argument.
B) anti-dumping argument.
C) countering foreign subsidies argument.
D) national defense argument.

Question

Quizplus · Accepted Answer

The argument put forth by U.S. steel firms during the 1960s, that they needed tariff protection to compete with Germany and Japan who were using new mills to make steel, is an example of the "infant-industry argument". This argument suggests that tariffs or other protectionist measures should be put in place to help fledgling industries become competitive, until they are mature enough to compete on their own. The U.S. steel industry was arguing that it needed protection to overcome a temporary disadvantage caused by the destruction of mills during WWII, and to allow it to establish itself as a competitive industry in the long run.