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Geithner and Beijing

Here’s a letter that I sent a couple of days ago to the Wall Street Journal:

You report that Treasury secretary Timothy Geithner is “planning to press Beijing to take drastic measures to turn China’s economy into one that depends heavily on sales to domestic consumers and less on sales to the U.S.” (“U.S, to Urge China to Shop, Not Save,” May 28).  In other words, Mr. Geithner will press the Chinese to take drastic measures to diminish their success at serving American consumers.

When business executives collude to restrict the amounts that they offer to sell to us, they’re in violation of antitrust statutes and are often charged as criminals (even though such collusion is unlikely to work).  But when government officials operate to achieve the very same outcome – i.e., reduced supplies available to consumers – these officials are portrayed uncritically, even heroically, as crafting “trade policy.”

Donald J. Boudreaux