… is from page 119 of my teacher Leland Yeager’s, and of his co-author David Tuerck’s, still-relevant 1966 volume, Trade Policy and the Price System:
Wanting import barriers to remedy unemployment shows poor understanding of what causes and cures recessions. Imagine – trying to become prosperous by getting rid of goods worth more than those you get! As J.M. Keynes once suggested, a tariff can do nothing against unemployment that an earthquake could not do better.
In this matter, Keynes was correct. Yet the difference between Keynes (and those who accept his nostrums) and sensible economists is that Keynes came to believe – as many Keynesians today believe – that tariffs and natural disasters (and terrorist attacks) are alike in that both are effective means of making people richer during recessions while sensible economists understand that tariffs and natural disasters are alike in that both are effective means of making people even poorer during recessions.
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