Here’s a letter to Fortune:
A lone error mars Roger Lowenstein’s marvelous essay on the connection between TPP and the classical economist David Ricardo, who was a principled advocate of free trade (“TPP and fast track: Why Congress should listen to the world’s richest economist,” June 22). That error is Mr. Lowenstein’s endorsement of Pres. Obama’s insistence that “that the [freer-trade] legislation also include retraining and support for the victims of trade.”
First, the word “victims” is inappropriate. Every producer – including every worker – is in business to satisfy consumers, and not vice-versa. So when consumers choose to buy fewer units of whatever some producer offers for sale, that producer is not in any way victimized. (If you doubt this claim, ask yourself if you regard people who switch to buying Priuses and other more fuel-efficient cars as being wrong-doers whose actions “victimize” Exxon and its fellow oil companies.)
Second, international trade is not unique in destroying particular jobs. All economic change does so. Chemical fertilizers, refrigeration, and motorized farm equipment destroyed lots of agricultural jobs. Inexpensive kerosene destroyed most whaling jobs. The telephone destroyed the jobs of telegraph operators. Personal computers destroyed jobs in typing pools. The Atkins diet destroyed some jobs in breweries and bakeries. The polio vaccine destroyed the jobs of many workers who made wheelchairs, crutches, and iron-lung machines.
Because all economic change – including change in the patterns of purely domestic trade – destroys some jobs and creates others, there’s no sound economic reason to accord special treatment to workers and other producers who lose jobs and profits to those economic changes that happen to be sparked by foreigners rather by fellow citizens.
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
(HT to Greg Mankiw for the pointer to Lowenstein’s essay.)