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Over the past 200 years, debates about trade have occurred on two levels. Academics insist that unilateral free trade is the best options. However the “very serious people” (VSP) who conduct real world trade negotiations act as if open markets are a “concession”. They act as if we were doing other countries a favor by letting them export goods to our market. They view the academic perspective as hopelessly idealistic, even as the VSPs have worked hard to gradually move the world toward the same goal of freer trade, one agreement at a time.
Today it looks like the VSPs who believe in globalization made a big mistake, and that the idealistic approach of unilaterally moving toward freer trade was the better strategy. The VSP approach opened the door to protectionist populists, and Donald Trump walked through. Protectionists are using the “concessions” myth as an excuse to impose higher tariffs. Other countries then face a difficult choice. If they give in to pressure from Trump, it would just encourage him to make even more demands.
Colin Grabow explains that Trump trade guru Peter Navarro misses the boat on the Jones Act [3].
GMU Econ alum Dan Mitchell writes – and speaks out – against Trump’s “dust-bowl economics. [4]” A slice:
And now we’re seeing it when bad trade policy is leading to more bad farm subsidies.
I realize this is pure fantasy, but wouldn’t it be nice to have the reverse approach? How about we simultaneously eliminate trade barriers and get rid of the Department of Agriculture [5]?
(See also this piece by Stephen Vukovits. [6])
Here’s Ilya Somin on Brett Kavanaugh [7].
Wall Street Journal columnist Holman Jenkins is correct that Uncle Sam’s antitrust challenge of the merger of AT&T with Time-Warner is farcical [8] – a fact, sadly, that does not stop the Trump people from pressing forward with the farce. A slice:
Smart people know when to cut their losses. But in politics, blunders must be hugged all the closer to one’s breast.
Alberto Mingardi helps to protect Adam Smith’s reputation from being hijacked by a man of system [9].
Jeffrey Tucker reflects productively on labor-market regulations and tight labor markets [10]. A slice:
In a real free market, labor and capital have equal “power,” if you want to call it that. They simply make a deal like any other. I will provide you services in exchange for which you give me money. If at any point this doesn’t benefit both parties, either party can bail on the deal. The right of the employer to fire is the other side of the coin of the right of the employee to leave the job. They go together. Servitude is forbidden on either side of the exchange.
This is why restrictions on firing are so insidious. They bind one side of the deal in ways that are contrary to the voluntarism of the market economy. We rarely hear politicians speak of restrictions on the right to quit. Those are taken for granted (with the one big exception of the military, which from the ancient world to the present presumes that the worker is in a position of servitude and cannot quit without facing serious repercussions).