Pres. Barack Obama
Dear Mr. Obama:
I applaud your recent support for freer trade. Yet I cannot help but note that all five of the benefits that your administration’s website ascribes to freer trade are beside the point. Each of your “5 ways that trade is linked to our economic strength” highlights ways that freer trade helps American producers. Your list contains not even a hint of the chief and overwhelming economic justification for freer trade – namely, the greater access to lower-priced goods and services that freer trade brings to consumers.
By ignoring the immense benefits to American consumers of having access to a larger variety of lower-priced imports – by instead promising only that freer trade will increase American producers’ profits, wages, and exports – you distort and, hence, imperil for the long-run the case for free trade.
Celebrating free trade for the benefits it yields, not to consumers, but to producers is akin to celebrating new life-saving medical breakthroughs for the benefits they yield, not to patients, but to physicians and big pharma. It misses the point completely.
Donald J. Boudreaux
Professor of Economics
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030