You Can’t Be “Screwed” By Being Denied X Unless You Have a Right to X

by Don Boudreaux on January 8, 2018

in Myths and Fallacies, Trade

Here’s a letter to Cafe Hayek commenter Craig Walenta:

Commenting on this blog post you repeat the canard that Americans benefit from Uncle Sam following a policy of free trade only if other governments follow a similar policy.  Specifically, you allege that Americans are “screwed” when other governments don’t practice free trade.

Your repetition of a fallacy justifies my own repetition of a truth.  Contrary to your implication, American producers have no right to the patronage of consumers.  Were it true that American producers are victims of wrongdoing when foreign firms offer deals to consumers that take business away from American producers, it must also be true that consumers are ethically or contractually obliged to spend some minimum portion of their incomes buying these American-producers’ outputs.  But no such obligation exists.

Let’s say that you produce tomatoes.  If you concede, as you must, that consumers are and ought to be free to grow their own tomatoes at home or to buy as many tomatoes as they wish from other American tomato growers, then you concede that you, as an American producer, have no right to consumer patronage of your business.  How, then, do you come to acquire such a right simply because foreign governments abuse their citizens with tariffs and subsidies?  You don’t.

Foreign tariffs and subsidies do indeed ‘screw’ people – namely, foreigners who, as consumers and taxpayers, are prevented by their governments from spending their money as they think best and who are thereby forced to spend their money in ways that they think worse.  Only these foreigners suffer rights-violations when foreign governments intervene in trade.  But because these interventions deny to you absolutely nothing that anyone is ethically or contractually obliged to give to you – because none of your property is taken by these interventions – you are a victim of no wrongdoing.  And if you successfully persuade Uncle Sam to protect you with tariffs, you then become an accomplice in perpetrating precisely the wrong that you claim to abhor: screwing Americans.

Donald J. Boudreaux
Professor of Economics
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercator Center
George Mason University
Fairfax, VA  22030

Note that it will not do for Mr. Walenta or anyone else to respond by insisting that foreign-government trade restrictions and subsidies do take American-producers’ property.  Such interventions do not, for no producer has a property right in consumer patronage.  There is no question that such foreign interventions cause some American producers to suffer losses that they would not otherwise suffer.  No one denies this reality.  The point is that, because no producer has any property right in consumer patronage, to some minimum level of sales, to some minimum level of profit, or to some minimum share of a market, such harm suffered by producers is simply an economic loss.  It is not a wrong inflicted on those producers.


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