China is Attacking the U.S. with Undervalued Currency

If you agree with the title, you may want to watch this video by Don Boudreaux, economist with George Mason University and blogger at Cafe Hayek.

Boudreaux Addresses Trump

On November 4, I sent the following e-mail to Don Boudreaux of Cafe Hayek and George Mason University requesting he address Donald Trump’s bad economics.

Hi Don,

I just returned to my hotel room, flipped on FoxNews and saw Donald Trump on Greta Van Susteren’s show talking foreign trade.  I think he covered just about every foreign trade myth in a short span.  “We don’t make anything here anymore, just health care.”  “They shut down a plant in Iowa and moved the jobs Mexico.  We need those jobs.”  “Put a tax on Chinese imports.” He also seemed a little fuzzy about government’s role in creating jobs, which is strange coming from a guy who manages to create lot of jobs without the government.

Here’s a link to the video: http://www.foxnews.com/on-air/on-the-record/index.html

It’d be nice to see a Boudreaux letter setting Trump straight.

The link no longer points to the Trump video.

While I didn’t get a response from Boudreaux, it was nice to see him address at least one of Trump’s foreign trade myths as he did in this letter in response to a Newsmax story.

After retrieving this e-mail from my sent messages folder, I was pleasantly surprised to see that it was coherent, considering I was in Vegas and blitzed at the time that I wrote it.

Here’s some feedback for Greta.  When you have folks like Trump or Buffett on who talk economics, don’t assume they know what they’re talking about just because they are successful business people.  Get a second opinion.

Advice for any news reporter who encounters a guest discussing foreign trade including Greta:

Do your viewers a service and call Don Boudreaux of George Mason University to get his view on their comments.  Boudreaux can point trade out myths and articulate why, though many sound good on the surface, they can be damaging.

Advice to Donald Trump:

Have lunch with Don Boudreaux.  He will help you understand why your trade myths are myths and help you find ways to articulate the truth in politically palatable manners.  And please do so before more people mistake your business success as a valid merit of your knowledge on foreign trade and you end up hurting more of the very people you may think you are trying to help.

Landsburg on Free Trade

Here’s another great passage from Landsburg’s The Big Questions.   Here he discusses the moral implications of a common hot button issue, foreign trade:

Princeton Professor Alan Blinder has recently estimated that 30 to 40 million Americans face the prospect of losing their jobs to lower-paid foreign competitors.  Or in other words, all Americans face the prospect of lower prices for the output of 30 to 40 million workers. That’s good, though of course 60 to 80 million would be better.

The italicized sentence made me smile.  That’s an excellent way to frame it.  We never think of it that way.  We  disassociate jobs from output or what we buy at the stores.  Or we assume that somehow the costs of the good, high paying jobs are magically absorbed by shareholders of a company rather than paid by customers.

It gets better:

Let’s start by observing that there is almost surely no such thing as a net loser from free trade.  (I owe this observation to George Mason University professor Don Boudreaux.) I doubt there’s a human being on earth who hasn’t benefited Continue reading