… is from page 112 of Book I, chapter 9 of the 1981 Liberty Fund edition of Adam Smith’s 1776 An Inquiry Into the Nature and Causes of the Wealth of Nations:
A country which neglects or despises foreign commerce, and which admits the vessels of foreign nations into one or two of its ports only, cannot transact the same quantity of business which it might do with different laws and institutions.
DBx: Many are the people who, on one hand, want Americans to import less but, on the other hand, want Americans to export more. Among these people are Trump and his trade advisors. Yet as Adam Smith knew, such a desire is not only bizarre (In what universe is it good to get less while giving up more in exchange?), it is impossible over the long-run. Buying fewer imports ultimately must result in the sale of fewer exports. Or, to put the point slightly differently, to restrict imports is to restrict exports. Trump and his advisors should Lerner a thing or two.
