In my latest column for AIER – and borrowing from a brilliant title that the great Dwight Lee used many years ago for one of his papers – I distinguish venal protectionists from sincere ones. (Bruce Yandle would call the former “bootleggers” and the latter “Baptists.”)
A slice from my column:
Yet while understanding the ethics of sincere protectionists is easy, for any sensible person to understand their economic arguments is quite a challenge. To enter the mind of a sincere protectionist is to step, like Alice, through the looking-glass. Up becomes down. Light becomes dark. Yes becomes no. More becomes less. Less becomes more. Everything is backwards, twisted, bizarro, and ultimately incomprehensible.
Sincere protectionists are in Wonderland.
Whenever a person of good sense explores the sincere-protectionists’ Wonderland, that person soon gets a headache. If he or she continues that exploration for too long without a break, severe nausea sets in. The Wonderland of sincere protectionists is truly a crackpot unreality.
What such an exploration of the sincere-protectionists’ Wonderland first reveals, of course, are its most obvious contradictions. And no protectionist claim is more obviously contradictory than this: residents of the home country will have more goods and services to buy, and all at lower prices, the fewer are the goods and services offered for sale in the home country by foreigners.
A variation on this incredible specimen of illogic is the protectionists’ conviction that importing goods and services is the price people pay to secure the privilege of exporting goods and services. Equally perverse is protectionists’ fear of trade deficits, for to fear trade deficits is to fear foreigners’ willingness to increase the amount of capital invested in your country. Such a fear is akin, say, to the citizens of Anytown, USA, fearing the building in Anytown of a new factory that will employ workers and produce valuable goods to be made available for sale in Anytown.
And let’s not forget this lulu of ludicrousness: protectionists’ certitude that the victims of government X’s molestation of its citizens with import tariffs and export subsidies are not the citizens of country X but, rather, the citizens of country Y who – the ludicrousness escalates – can be sheltered from this alleged molestation only if they are molested in like fashion by their own government.