Sen. Charles Schumer
Dear Sen. Schumer:
Up-in-arms that the Chinese offer American consumers exceptionally good bargains, you propose legislation to pressure the Chinese to raise the prices of their exports. And, insisting that Congress pass your bill speedily, you warn that “every day we wait is a day we lose wealth.”
Let me see if I grasp your economics. Low prices – including low prices on many imports that American producers use as inputs in their own production – cause us to “lose wealth.” High prices, then, must cause us to gain wealth.
Okay! I get it! Now I understand that competition – which reduces prices – destroys wealth.
And technology! Man, that’s a big-time curse, given that it incessantly enables more and more outputs to be produced with fewer and fewer resources and workers and, thus, consistently pushes prices down.
No wonder we Americans are so poor and sub-Saharan Africans are so rich! We’re burdened with vast, open, competitive markets teeming with technology-laden producers, all of which combine to reduce the prices American consumers pay and, hence, (I now see) to deplete America’s wealth. In happy contrast, Chadians and Nigerians and other Africans are blessed with governments that severely restrict their abilities to trade, to compete, and to accumulate accursed price-lowering technologies.
Thank you, thank you, thank you Sen. Schumer for working to make America more like Niger! What would we do without your insight and courage?
Donald J. Boudreaux
Professor of Economics
George Mason University