Here’s a letter to the Baltimore Times:
National Mining Association CEO Hal Quinn applauds “the premise laid out in [Pres. Obama’s] 2010 National Export Initiative: If we sell more products to our trading partners than we buy from them, we will … add value to our economy” (“Supporting Coal Exports Brings Jobs to America,” June 7).
Mr. Quinn and Mr. Obama are mistaken. To see why, suppose that over the course of your life you produce for sale a total of 1,000 units of real goods and services. Now ask which of the following outcomes you’d value most highly as a result of your selling these 1,000 units: (1) you receive in exchange a total of 500 units of real goods and services for you to consume; (2) you receive in exchange 5,000 units of real goods and services for you to consume; or (3) you receive in exchange 50,000 units of real goods and services for you to consume? Clearly, (3) is the best of the three outcomes – a fact that proves that the greater the amount of real goods and services that you receive (that is, import) in exchange for what you sell (that is, export), the better off you are.
People grow wealthier the greater – not the lesser – is the number of valuable goods and services they get in exchange for whatever goods and services they produce and sell. This fact is no less true for that collection of people called “Americans” than it is for individuals named Bill, Betty, Hal, or Barack.
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