Mr. Michael Stumo, CEO
Coalition for a Prosperous America
Dear Mr. Stumo:
In your June 21st TradeReform.org blog-post (“House letter on Currency“) you applaud the 230 members of the U.S. House of Representatives who “sent a bipartisan letter to President Obama urging him to address currency manipulation as negotiations over the Trans-Pacific Partnership (TPP) continue.” These members of Congress, like yourself, want Pres. Obama to demand that the Chinese government stop transferring wealth from the pockets of the Chinese people into the pockets of American consumers who, as a result of the purported currency manipulation, pay artificially low prices for a slew of consumer goods.
Put differently, the signatories of the letter worry that a stream of resources allegedly transferred through (mercantilist-) state policies by the Chinese government to foreigners (namely, to Americans) strengthens the Chinese economy as it impoverishes us Americans who gobble up the subsidized goodies. Yet many of those very same signatories – when turning their attention to immigration – worry that a stream of resources allegedly transferred through (welfare-) state policies by the U.S. government to foreigners (namely, to immigrants) weakens the American economy as it enriches the immigrants who gobble up the subsidized goodies.
If I were you, I’d think thrice before applauding letters and other pieces of pontification issuing from officials so logically inconsistent.
Donald J. Boudreaux
Professor of Economics
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030