Libertarians are known and often criticized for their stand on free trade. Protectionist measures put some Americans out of work so others can make more money. When government artificially restricts imports, it restricts American exports and causes job loss in other sectors of the economy. Free trade is the best national defense we can have. No nation goes to war with their trade buddies. We deter terrorism, improve economies and gain stronger influence in countries we trade with.
If the trade deficit between nations is such a problem, why don't we worry about trade deficits between states, cities and neighborhoods? Shall we compare the productivity of Cleveland with Youngstown or Ohio with West Virginia? Do urban areas do as well as the suburbs? Will farmers ever be able to compare their industry to that of entertainers? Shall we make laws to make them all equal? That's called Socialism and it steals motivation fro producers and enables the nonproductive to continue.
I admit problems exist when one nation uses slaves in an industry. The US cannot compete with the slave labor used in China's steel industry. However, there are better ways to handle it than to eliminate trade with them completely. Much as we would not restrict companies from opening in lower income areas of the US, we should not over react to problems caused by low income slave laborers in other countries.
1) "Nations do not trade with nations...individuals trade with individuals. Each wants what the other gives up. Each places a higher value on the thing gained than on the thing surrendered. Each comes out ahead...Should we worry about trade deficits between states, cities or neighborhoods?" Sheldon Richman, Freedom Daily 8/98.
2) "Trade barriers are costing American consumers and businesses roughly $70 billion per year, according to the Institute for International Economics," James Bovard USA Today 2/16/94.
3) "According to a 1984 Federal Trade Commission study, import quotas on Japanese automobiles preserved 4,598 American auto jobs, but cost consumers $241,235 per job per year in higher prices paid for cars. Saving a $30,000 American steelworker job cost consumers $114,500 annually in higher prices," Readers' Digest 5/93.
4) "...countervailing duties and anti-dumping penalties on foreign suppliers of steel since 1992 have saved the jobs of 1,239 steel workers at a cost to consumers of $835,351 [per job]," Hobart Rowen, The Houston Chronicle 1/7/94
5) "Nations do not trade with nations...individuals trade with individuals. Each wants what the other gives up. Each places a higher value on the thing gained than on the thing surrendered. Each comes out ahead....Should we worry about trade deficits between states, cities or neighborhoods?" Sheldon Richman, Freedom Daily 8/98.
6) "The tariff code...now has 8,753 different rates...equivalent to over 8,000 different industrial policies..and over 8,000 different entitlement programs for protected domestic industries. While the average tariff is 5%...
* Low priced watch parts are hit with a 151.2 % tariff.
* Duck liver tariff is 16 times higher than the tariff on goose liver.
* See ECONOMY for more.