July 29, 2018

DUDE, IT'S THE HARMONY THEY HATE:

Nations don't trade with each other, and trade is not a war (Jeff Jacoby, July 28, 2018, Boston Globe)

The evidence is piling up that the impact of Trump's retaliatory trade penalties has been falling hardest not on foreigners, but on Americans. Yet when the president indignantly declares that America is being victimized by its trading partners, much of the nation nonetheless nods approvingly. In a new survey, the Pew Research Center found that while 49 percent of respondents thought higher tariffs would be damaging, fully 40 percent said they would do more good than harm.

All of this comes from thinking of trade as metaphorical warfare -- as an economic struggle pitting nation against nation.

That's a great fallacy. Nations don't trade with each other. We speak as if they do out of habit and convenience, but it's not true. The United States and Canada are not competing firms. America doesn't buy steel from China, and China doesn't buy soybeans from America. Rather, hundreds of individual American companies choose to buy steel from Chinese mills and fabricators, and hundreds of Chinese-owned firms make deals to buy soybeans from far-flung American growers. Unlike wars, which really are fought by nation against nation, international trade occurs among countless sellers and buyers, all acting independently in their own best interest.

Tariffs don't punish countries. They punish innumerable consumers, wholesalers, importers, exporters, farmers, manufacturers -- the myriad discrete actors whose choices and preferences are the true substance of international trade. To those individuals, national trade deficits and surpluses are irrelevant. They aren't competing -- they're cooperating. Buyers and sellers aren't in conflict with each other, let alone with each other's countries.

On the contrary: By doing business together, traders create wealth and connections, knitting the world together in mutual interest, making the planet more harmonious.

Protectionism is just Race War, which is why it always comes with Nativism.

Posted by at July 29, 2018 9:55 AM

  

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