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Repeatedly Repeating Myths Does Not Transform Pains Into Gains

Here’s a letter to a Café Hayek reader:

Mr. McGee:

You accuse me of being “unconnected from the real world” and “stubbornly unwilling” to “go along with people like Senator Lindsay Graham who explain that the pain caused by President Trump’s tariffs is temporary and worthwhile since it will shrink our trade deficits and bring us greater gains in the future.”

With respect, I can only repeat myself: because the president is bargaining for American imports to fall relative to American exports, what we will receive tomorrow as a result of the pain we suffer today from the president’s war on trade are not “greater gains”; we’ll in fact receive greater pains.

To the extent that Trump ‘succeeds’ in his trade bargaining, we Americans will receive fewer imports in exchange for each of our exports – which is to say, Trump is bargaining to reduce the value of our exports.

If you, Mr. Trump, Sen. Graham, and pundits such as Steve Moore believe that you are each made better off by receiving less from non-Americans for each good or service that you supply to non-Americans, by all means feel free to accept less. But do not compel the rest of us to receive less for the outputs that we supply.

And please also refrain from assaulting our good sense with cant such as the nonsensical assertion that by bargaining for us to receive fewer imports in exchange for our exports, the president is thereby arranging for us to receive long-term gains.

Donald J. Boudreaux
Professor of Economics
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030