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William Hawkins — Senior Fellow at the U.S. Business and Industry Council [2] — writes a lot about trade. Unfortunately, his understanding of trade is stuck in the 17th-century; he’s a thorough-going mercantilist [3] whose ideas Adam Smith [4] would recognize and criticize.
Here’s Hawkins’s op-ed [5] in today’s Washington Times, filled with familiar (and inappropriate) worry about “the massive wave of imports from Asia” and “the massive outflow of capital and technology to Beijing.”
And here’s a letter that I sent today to the Washington Times in response:
24 September 2006
Editor, The Washington Times
Dear Editor:
By lamenting American imports (“NAFTA highway or new silk road?” Sept. 24), William Hawkins implies that trade’s benefits are measured in exports and its costs measured in imports. But if the purpose of economic activity truly were to produce and sell as much as possible in exchange for as few goods and services as possible, workers would clamor to work longer hours for lower wages – and they’d applaud whenever the purchasing power of their wages falls.
I suggest that you test the consistency of Hawkins’s belief by paying for all of his future contributions to your newspaper with Monopoly money. If he really believes what he writes, Hawkins will be thrilled to exchange the fruits of his labor for scrip that he can never exchange for goods and services.
Sincerely,
Donald J. Boudreaux