In this unsigned editorial, the Wall Street Journal‘s editors bust lots of myths about trade deficits (including some of the myths peddled in the WSJ‘s pages earlier this week by Trump trade advisor Peter Navarro). A slice from the Journal‘s editorial:
The “economic nationalists” fret about foreigners buying U.S. property, but that hardly jeopardizes U.S. sovereignty. The U.S. capital stock isn’t a fixed amount and adding to what is here doesn’t diminish U.S. ownership. It does, however, allow current owners to cash out of their property and put that money to other uses. The owner of a bricks-and-mortar business might sell and invest in a tech start-up. Restricting foreign ownership would reduce demand to hold U.S. assets, hardly a way to make America great again.
As much as I greatly admire my late Nobel-laureate colleague, Jim Buchanan, I agree with Bob Higgs that Jim was uncharacteristically and unfortunately romantic about the prospects of sound constitutional reform.