Making Americans Poorer

by Don Boudreaux on April 2, 2008

in Politics, Trade

"Clinton Proposes Plan to Make Firms Inefficient" would have been a more accurate headline to this report at Newsweek.com.  I sent this letter in response:

Courting blue-collar
votes, Hillary Clinton promises to use "tax incentives to persuade
companies to ‘insource’ jobs in the United States" ("Clinton proposes
plan to keep jobs in US," April 2).  Because firms ‘outsource’ jobs
only when doing so lowers firms’ costs of production, Mrs. Clinton’s
proposal amounts to bribing American firms not to lower production
costs whenever possible.  She wants to encourage American firms to
produce inefficiently, which is to say wastefully.  In short, she wants
us to be poorer than we would otherwise be.

Mrs. Clinton’s proposal is further evidence that good politics typically is bad economics.

Sincerely,
Donald J. Boudreaux

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