	u s study says tariffs and quotas could backfire the use of tariffs and quotas to reduce the flow of foreign goods into the united states will do little to cut the nation s swelling  deficit a government study said in fact the federal  commission ftc report said such protectionist policies could make u s products less competitive in the world marketplace by raising the cost of imported products that are re exported in different forms such policies are much more likely to hurt rather than help the productive capabilities of the u s economy it said the page report written by ftc economists john hilke and philip nelson blamed the rising  shortfall which climbed to a record billion dlrs last year on shifting currency exchange rates and growing u s consumer demand other factors commonly blamed for the deficit such as foreign  practices deteriorating u s industrial competitiveness high labour costs and government restrictions on mergers added little to the problem it said although each industry s competitiveness affects the level of imports and exports in that industry in general we find that there have been no significant industry specific changes affecting competitiveness that would explain the increase in the overall  deficit the study said to the extent any government action is needed to deal with the  deficits policies should focus on economy wide phenomena such as exchange rates and relative economic growth the ftc study said supporting its conclusion that broad based economic shifts were the cause of the increase in the  deficit the report said it found that nearly all u s industries lost some domestic market share to foreign competitors in the s it also said it found a fairly direct relationship between the increased  deficit and the influence of shifting currency exchange rates u s economic growth and domestic demand for goods and services which has outpaced foreign consumer demand the study examined seven factors which have been commonly blamed for the  deficit foreign government subsidies and  barriers to protect foreign industries a lack of investment in u s industry declining research and development in u s industry high labour costs union work rules the oil prices rises of the s and u s antitrust regulations in each case the study found little or no evidence that the factor had any impact on the  deficit reuter 
