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Getting "Tough" on Trade

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A March 10th headline [2]
in the Washington Post reads "U.S. to Toughen Its Stance On Trade.”  Sounds great!  Who wants
their government to be bullied by bad guys?

Trouble is,
"getting tough on trade" is a euphemism for government being bullied by bad guys.  When government "toughens" its trade posture, it
always does so under pressure from organized producer groups –
producers too frightened, too greedy, and too unprincipled to compete against foreign
rivals – producers too namby-pamby to vie for consumer demand without
government making it tougher for consumers to get the most for
their money by buying imports.

Getting “tough” on trade means protecting domestic producers from having to compete head-on with foreign rivals.

"Toughening” trade protection is no
manly maneuver.  Nor is it a policy likely to discipline domestic firms
into becoming as productive as possible.  Being protected from
competition by a “tough” trade policy encourages domestic producers to
get weak.  Why stay on top of your game if a “tough” protector will
cover you should you lose a step or two?

More importantly,
getting “tough” on trade directly assaults domestic consumers.  A
“tough” U.S. trade policy prevents Americans from spending their money
as they choose.  Americans are told by the government allegedly empowered to protect their rights and liberties that “You may not deal with
foreign suppliers as you wish; you must deal with them on terms
conditioned by Washington or not deal with them at all.”

In short, it’s impossible for any government to get “tough” on foreign traders without also getting tough on its own citizens.

Of
course, whenever Uncle Sam “toughens” his stance on trade, American
consumers aren’t alone in their suffering.  Foreign rivals of the
protected firms are indeed among those who suffer.  It’s this damage to
foreign firms that lends not only plausibility, but even glamour, to
the “get tough” rhetoric.  But because foreign firms generally prosper
in America only by giving U.S. consumers the most value for the dollar,
it’s fair to ask those officials who call for “tougher” trade policies:
“What, exactly, do you have against American consumers?  Why do you
want to force them to get less bang for their bucks?  How will coddling
domestic producers behind a wall of protection make the U.S. economy
resilient and tough?”

For the U.S. "to toughen its stance on
trade" is for Uncle Sam – bullied by special interests – to thumb his
nose at ordinary Americans while barking at them "tough luck."

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