This lack of meaningful interstate competition is a boon to state and local legislators but bad for taxpayers. The states and the federal government now act as a tax cartel. They are in a position to charge more for their services even when the quality is getting worse.
While I could pick a few nits with this Wall Street Journal op-ed by Jason Furman, he is correct to argue that the Trump administration is mistaken to accuse Beijing of keeping the value of the Chinese yuan artificially low . A slice:
Another law of economics explains why China’s currency has slid somewhat more against America’s than the euro or the yen. Tariffs depreciate the currencies of countries they’re imposed on, because decreasing imports lowers demand for the exporter’s currency. China’s retaliatory tariffs have an offsetting effect. Yet the U.S. imports more from China than it exports, so its tariffs are levied on a larger base. Rising oil prices have compounded the downward pressure on its currency.
Regardless of whether Beijing put its thumb on the scale, U.S. policy and shifting economic fundamentals have weakened the yuan against the dollar. And it’s worth noting that there are no direct signs of such manipulation.