The following appeared as part of an article in a weekly newsmagazine:
“The country of Sacchar can best solve its current trade deficit problem by lowering the price of sugar, its primary export. Such an action would make Sacchar better able to compete for markets with other sugar-exporting countries. The sale of Sacchar’s sugar abroad would increase, and this increase would substantially reduce Sacchar’s trade deficit.”
Discuss how well reasoned you find this argument. In your discussion be sure to analyze the line of reasoning and the use of evidence in the argument. For example, you may need to consider what questionable assumptions underlie the thinking and what alternative explanations or counterexamples might weaken the conclusion. You can also discuss what sort of evidence would strengthen or refute the argument, what changes in the argument would make it more logically sound, and what, if anything, would help you better evaluate its conclusion.
Sugar is a staple of life around the world. Whether in the form of high fructose corn syrup or sucrose, sugar is cheap and readily available in most stores. This low cost and availability make sugar a common ingredient in processed foods and beverages. This said, although sugar has numerous health benefits, it also has some drawbacks. Most notable among these are weight gain, tooth decay, and diabetes. Although these health concerns are not apparent in developed countries, they are rampant in impoverished countries. These nations sell their unrefined sugar at high prices that cover the cost of processing it, then export their product at a profit
The author makes several assumptions about Sacchar and about the necessity of lowering the price of sugar. The first is that Sacchar produces more sugar than it consumes. This may be true, but is not necessarily relevant. Sacchar’s major export is sugar, and this defines its economy. It is possible that if the price of sugar decreased, Sacchar would import more sugar, but because of the high price, it would export more. Thus, the export surplus would come to nothing
The second assumption is that lowering the price of sugar would increase its sales. This may be true, but would also be irrelevant. The fact that sugar is so cheap means that many countries import it. If Sacchar lowered its price, other countries simply would not buy as much of it as a Sacchar export. Thus, the export surplus would not increase, but would decrease
The third assumption is that exporting sugar would reduce Sacchar’s trade deficit. This assumption is questionable. If Sacchar lowered its price, other countries would simply buy less, not more, of Sacchar’s sugar. Thus, in lowering its price, Sacchar would increase its trade deficit
The author’s final assumption, that the export of sugar would increase, is bolstered by the statement that ‘the sale of Sacchar’s sugar abroad would increase.’ This statement, however, is vague. Does the author mean that Sacchar would be able to export more sugar? Or, given the current demand for sugar, could Sacchar sell more sugar? If Sacchar was able to sell more sugar, its trade deficit would be reduced, but it would not necessarily have a larger surplus. Moreover, if other countries bought less, Sacchar’s exports would not increase, but decrease
The author’s logic is flawed. There is no need for Sacchar to lower the price of sugar. This would only increase its trade deficit. If Sacchar were able to export more sugar, this would only reduce its trade deficit by decreasing the amount of sugar it imports. Instead, Sacchar should concentrate on producing less sugar. This would reduce its trade deficit without decreasing its export surplus.