… is from page 591 of Liberty Fund’s 2006 edition of John Stuart Mill’s 1848 Principles of Political Economy:
According to the doctrine now stated, the only direct advantage of foreign commerce consists in the imports. A country obtains things which it either could not have produced at all, or which it must have produced at a greater expense of capital and labour than the cost of the things which it exports to pay for them. It thus obtains a more ample supply of the commodities it wants, for the same labour and capital; or the same supply, for less labour and capital, leaving the surplus disposable to produce other things. The vulgar theory disregards this benefit, and deems the advantage of commerce to reside in the exports: as if not what a country obtains, but what it parts with, by its foreign trade, was supposed to constitute the gain to it.
DBx: Of course, what Mill calls “the vulgar theory” remains widespread among the populace today. It is a core belief of Donald Trump as well as of many members of Congress, regardless of party. And it is a belief that truly is vulgar: it’s primitive, irrational, and wrong. This belief implies, if it were true, that we Americans would be enriched if we were to receive for our exports mounds of Monopoly money, and impoverished to the extent that we receive, not money of whatever kind, but real goods and services.