Free Trade

Tuesday, April 10th, 2018

A trade war would not only make the United States less productive. It would also make monetary policy more difficult.

Sunday, April 8th, 2018

The legal uncertainties surrounding trade with China have sent people looking for historical precedent for this mess. One jumps out: the targeted trade embargo that the US imposed against Britain in 1807. Let’s look at the parallels and lessons.

Tuesday, April 3rd, 2018

The results of this war are as follows. US consumers get to pay more for imports from China. American companies lose markets as Chinese consumers and importers turn to other countries to provide wines, pork, and fruit. And this is only round one. The financial markets have suffered a terrible quarter one, just as all this interventionist rhetoric picked up steam. We are doing ourselves no favors here. This is not how a nation becomes great again.

Saturday, March 24th, 2018

In a political sense, Trump might be onto something, temporarily, in the most cynical way. It is very easy for the hoi polloi to think in terms of national collectives. It’s us vs them, our guys vs. their guys. The trouble is that the world is no longer organized primarily along these nationalistic lines. We all depend on the productivity of each other and therefore on trade with each other, regardless of the nation states that trap us in their borders. The other main problem with trade war: it is a ruse to distract citizens from their real oppressor which is their own government.

Monday, March 19th, 2018

The goal of feeding the power of the chief executive is always the core motivation of all forms of mercantilism, whether in the 17th century, the interwar years, or our own times.

Friday, March 9th, 2018

It’s been a beautiful thing to observe the wonderful effects of the tax cuts and deregulation of the last year. The tariffs take us off this clear path to the goal. The only question remains: is this a cul-de-sac or a u-turn? My own hope is that the political posturing is over in this one sector and we can move forward again with progress toward a world of peace, prosperity, and free trade, and that arbitrary rule will not permanently derail the rule of law in international economic relations.

Thursday, March 8th, 2018

Restricting trade to boost aggregate demand is a fool’s errand.

Saturday, March 3rd, 2018

And this isn’t only about the price of beer (you won’t say “dilly dilly” to $2 Bud Lights). It is about cars, computers, homes, offices, fixtures, and countless other items you use every day. The costs could very easily take away all the benefits accrued from income and corporate tax cuts. It also makes a joke of the Trump administration’s position against red tape and regulation. If my company can’t shop around for the best deal for my customers but instead must face a terrible trade bureaucracy to decline or permission in my every choice, we don’t have free enterprise.

Friday, March 2nd, 2018

Corporations and many households rightfully celebrated when the Trump administration led the way in cutting their taxes. Now, the administration is in effect clawing at least a little of that tax cut back in the name of increasing the profitability of two ailing American industries.

Wednesday, February 7th, 2018

Economists tend to minimize those people who are hurt in the short run by free trade, but they're hard to ignore as a political voting bloc.

Friday, October 27th, 2017

The “FT” in NAFTA may stand for “free trade,” but that doesn’t mean it is.

Thursday, October 26th, 2017

The Jones Act prevents Hawaii from prospering from free trade.

Friday, June 16th, 2017

Adam Smith wisely pointed out what should have already been obvious: “Consumption is the sole end and purpose of all production.”

Wednesday, May 10th, 2017

We’ve been writing a lot lately about trade and immigration policy, and getting a wide array of thought-provoking comments.

Tuesday, April 25th, 2017

House Speaker Paul Ryan recently proposed a tax plan called A Better Way: A Vision for a Confident America. Ryan’s plan to make the United States more competitive includes a tax cut for businesses, a switch to a territorial tax system, and a border-adjustment tax. A tax cut and a switch to a territorial system would be positive for the economy. On the other hand, the border-adjustment tax would work like a tariff. It would encourage inefficient domestic production, which would raise prices and reduce real output. Over the long run the BAT would not even reduce the trade deficit.

Friday, April 21st, 2017

How much does import competition affect U.S. jobs?

Tuesday, April 11th, 2017

Few areas of life are as poorly understood as trade. This is remarkable because each of us engages in trade every day. We buy our groceries, clothing, electronics, etc. from other people rather than making them ourselves. If we didn’t think trade was worthwhile, we wouldn’t do it. But we do—because we know how poor we would be if each of tried to make all the things we want.

Monday, April 3rd, 2017

Free trade lets global markets provide consumers with the best products at the lowest prices.

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