Here’s a letter to a new reader of Cafe Hayek:
Mr. Ted Stockton
Thanks for you e-mail.
Alleging that I “ignore the moral side of trade,” you note that “it’s not only efficiency that matters for judging the damage imports do. People’s well being matters also.”
I go even further than you: I believe that people’s well-being does not merely also matter; I believe that people’s well-being is all that matters. You are mistaken to assume that arguments against policies that create or perpetuate inefficiencies are not arguments about the well-being of flesh-and-blood people. The very reason for championing efficient over inefficient uses of resources is that the more efficient is the use of resources, the greater, in practice, is the well-being of the greatest possible number of people.
But more deeply I disagree with your assessment of my case for free trade. I very seldom argue on strict efficiency grounds (although it’s true that most of my – and other economists’ – arguments for free trade are ones that, were they to guide policy, would increase efficiency). Most of my arguments involve little more than pointing out the many protectionist inconsistencies, oversights, and misunderstandings that fuel opposition to free trade. One such misunderstanding is that imports are unique – or are uniquely awful – sources of job destruction. Yet imports are no such thing .
And ultimately, I support free trade not mainly because I believe it to be the policy that maximizes efficiency. I support free trade, ultimately, because I believe that when government obstructs individuals’ peaceful commercial activities it behaves immorally. How I spend my money is none of your business, and how you spend your money is none of my business – and this reality doesn’t change one iota if one or the other of us grabs political power.
By the way, economists have long had a “moral side” to their opposition to protectionism and other government impositions on commercial activities. Here’s Adam Smith writing in 1776, and in that part of The Wealth of Nations singularly devoted to exposing the errors, the folly, and, indeed, the immorality of mercantilism: “To prohibit a great people, however, from making all that they can of every part of their own produce, or from employing their stock and industry in the way that they judge most advantageous to themselves, is a manifest violation of the most sacred rights of mankind.”* Smith’s argument here for economic freedom is a moral one – and I find it to be quite compelling.
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
* Adam Smith, An Inquiry Into the Nature and Causes of the Wealth of Nations (1776); Book IV, Chapter 7 , paragraph 66.