Trump is never more certain than when he is completely clueless. The truth is that protection against foreign trade leads away from prosperity and strength. A country that deprives itself of foreign goods is doing to itself what an enemy might try to do in wartime—cut it off from outside commerce. It is volunteering to impoverish itself..
Countries don't "ravage" us when they make "our" products; they help us. At the risk of belaboring the obvious, the essence of trade—foreign or domestic—is that it makes both buyer and seller better off. Otherwise, they wouldn't bother.
But preventing such mutually agreeable transactions is Trump's dream. Already he has announced he will renegotiate NAFTA and walked away from the Trans-Pacific Partnership, a 12-nation deal that Barack Obama signed but Congress had yet to approve.
Trump may promise "great deals," but he is likely to get—and would probably be content with—no deals. What foreign government will rush to sign an agreement stipulating that our companies will only "buy American and hire American"?
His belief that international commerce is bad for Americans and protection is good for us is not a theory but an ancient superstition. One of the most irrefutable insights of economics is that if a country can buy something abroad for less than the cost of making it at home, it's better off buying it. That transaction allows citizens to consume more for each dollar spent. It makes them richer.
Tuesday, January 31, 2017
Trump is Never More Certain Than When He is Completely Clueless
Steve Chapman writes:
at 5:10:00 AM