Sunday, October 21, 2018

A Response to the Charge That I Have My Head Up My Ass

Don Boudreaux
A Don Boudreaux letter to a reader:
Mr. Ernie McDonald
Mr. McDonald:
You write that “our survival as a nation is threatened by never ending floods of cheap imports priced below their full value.” And after asserting that because I’m a tenured “heads up [my] ass” professor I “have no right” to criticize protectionists, you call me “gullible, blind and ignorant about the Real World.”
I’ll treat you here with the respect that you deny to me in your hostile and impolite letter.
First, like you I have a right to criticize or to praise anyone or anything I wish as long as I do so peacefully. You have no duty to listen to me, but my job status does nothing to strip me of my right to speak and to write freely.
Second and more substantively: How can it be that our “never ending” access to low-priced goods threatens our survival? Is your and your family’s survival threatened when you purchase goods that are on sale? If in a supermarket contest you were to win a lifetime of free groceries, would you tremble in fear and then refuse the winnings? I suspect not.
You will (mistakenly) reject my supermarket analogy as inapt. And so, third, I ask if you believe that our survival as a nation is threatened by never-ending floods of technological innovation. One of this year’s Nobel laureates, William Nordhaus, found that innovators capture, on average, only 2.2 percent of the full value of their innovations. As a practical matter, this fact means that when innovators, in never-ending new streams, offer to us goods and services at prices that not only are below those of existing goods and services but a tiny fraction of their “full value,” we happily accept and, as a result, are all enriched.
Can you explain to me why, if the much-greater abundance brought to us routinely by innovation makes us richer, the greater abundance brought to us by trade threatens our survival?
Donald J. Boudreaux
Professor of Economics
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030
The above originally appeared at Cafe Hayek.


  1. How dare you use logic, you sly bastard!

  2. Professor Bourdeaux, your passion for, and commitment to the truth and rationality is commendable but I think you're wastimg your time arguing with people like the person who took time to write to you just to insult you and accuse you of heretical thinking. You give fools more exposure than they deserve. When it comes to basic economics, arguing with Trumpistas is like arguing with flat-earth believers.

    1. I dont think it's a waste of time. Even if he doesn't convince this person, others have seen this and it may influence them. It certainly isn't any more of a waste of time than trying to convince people that socialism works and look how successful the people who waste their time doing this are.

  3. I think the professor missed the writer's deeper meaning. The flood of cheap goods from foreign countries is looked upon by many, especially those lacking in a basic understanding of economics, as resulting in a decrease in the number and quality of jobs in our country. This is the point of Trump's tariffs. This is the point of all the "buy American" people. And it would be a problem *if* the fact that the US doesn't produce all those cheap goods anymore meant we had fewer jobs, with the resulting loss of income and prosperity. I'm sure the professor could have set the record straight on that error.