David Henderson is properly skeptical of Trump’s trade triumvirate of Robert Lighthizer, Peter Navarro, and Wilbur Ross – each of whom, like their bloviating new boss, is on record with many statements revealing a complete misunderstanding of trade. A slice from David’s post:
One of President-elect Trump’s most sincerely held views is that free trade is suspect. He buys into virtually every mercantilist myth, even claiming in a recent tweet, “China has been taking out massive amounts of money & wealth from the U.S. in totally one-sided trade.”
This goes way beyond mercantilism into incoherence. No trade can be a little one-sided, let alone “totally one-sided.” The reason is that when you trade, you give something up and get something in return. Trade is necessarily two-sided. Even more flabbergastingly, Trump is not complaining that Americans don’t get enough from China in return. He’s complaining that it gets too much! This massive amount of wealth that he thinks China is taking from America is, mysteriously, in the form of goods that we Americans buy from China at low prices. What nerve those Chinese people and firms have, selling us things at low prices when, Trump seems to be saying, we should prefer to buy them at high prices.
Steve Forbes rightly warns against the GOP’s dangerous “border-adjustability tax” proposal. (HT Dan Griswold) A slice:
Why are the Republicans doing this? They say the revenue raised will help finance a huge tax tax cut, such as getting rid of the death tax and the horrific alternative minimum tax, cutting the corporate tax rate from its disastrous 35% to a highly stimulative 20% or less and very meaningfully lightening the tax burden on individuals. These are all extremely exciting ideas and would do wonders for the economy. But enacting a big, brand-new tax to finance cuts in old taxes is a dangerous business, especially in the way the Republicans are going about it. Democrats will gleefully remind voters why prices are going up, conveniently ignoring the tax cuts. Moreover, the GOP border adjustment tax is a but a small step away from a full-blown value added tax, which has financed the bloating of governments around the world.
Vincent Geloso discusses his favorite recent works in economic history.
Derek Scissors summarizes foreign investment during 2016 by the Chinese. (See also this related data source.)
My colleague Alex Tabarrok highlights one example of crappy FDA regulation.
Jeff Jacoby explains that hateful (and hate-filled) opinions are not – and ought not be treated as if they are – criminal. His conclusion, with which I fully agree:
Society has a duty to punish a criminal’s evil deeds. But there is never a duty to punish a criminal’s thoughts, no matter how evil they may be.
George Will looks back on Alan Sokal’s good deed of 1996.
John Glaser argues – correctly, I believe – that Uncle Sam’s role as world cop is very costly indeed.
