Giant Blowing Sound

Here’s a letter of mine that appears in the current (June 25th) edition of The Nation:

Inspired by the controversial work of William Baumol and Ralph Gomory,
William Greider argues that those of us who oppose protectionism today
are mindless members of "the church of global free trade" ["The Establishment Rethinks Globalization,"
April 30]. But it is Greider and his ilk who are blinded by a faith
wholly at odds with reality. If it were true that the developing
world’s large supply of highly skilled but low-paid workers inevitably
attracts capital away from high-wage countries such as the United
States, foreign direct investment in open developing countries would be
higher than in the United States. It’s not. In 2006, China attracted
$46 of FDI per capita; India attracted just over $14 per capita; the
United States attracted $578 per capita.

Donald J. Boudreaux
Department of Economics
George Mason University

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