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Quotation of the Day…

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… is from page 32 of Harvard University economist Frank Taussig [2]’s 1904 presidential address to the American Economic Association; it is published in the February 1905 issue of the American Economic Review and is titled “The Present Position of the Doctrine of Free Trade [3]“:

The mercantilist view of international trade, exploded though it has been time and again, has a singularly tenacious hold. Even among the most intelligent writers in financial journals, the familiar attitude is that of rejoicing in a gain of exports, regretting a gain of imports: rejoicing in an inflow of specie, bewailing its outflow; so familiar that probably the immense majority of persons who have never been systematically trained in economics take this point of view as a matter of course.

DBx: Plus ça change, plus c’est la même chose.

The same superstition that helped to impoverish nations in the 17th century was still, when Taussig wrote these words, widely accepted despite the passage of more than a century since the death of the man – Adam Smith [4] – who did the most to slay this absurd superstition. And this superstition remains widely accepted today. Indeed, this superstition is a core dogma believed not only by Trump and most of his base, but also by persons who are not as different from Trump as they and others believe – persons such as Bernie Sanders, Chuck Schumer, and Sherrod Brown.