My intrepid Mercatus Center colleague Veronique de Rugy joins me in being dismayed by Henry Olsen’s call for Trump to artificially diminish the abundance of petroleum to which Americans now have access .
Joakim Book – like Veronique but unlike those, such as Henry Olsen, whose thinking about economics is shallow and uninformed – understands the benefits of globalization in times of crisis . A slice:
Paradoxically, self-sufficiency – the kind of subsistence living that protects you from global pandemics or financial crises – is precarious. Local risks like storms, harvest failures, or forest fires cannot be dealt with by drawing on resources from elsewhere.
In contrast, depending on others via lengthy global supply chains exposes us to occasional shortfalls of specific goods and relative price changes when storms or viruses knock out some production. But price systems and capitalist entrepreneurs work hard to find more, to adapt, to substitute, and to create the very resources most urgently needed.
Indeed, they work harder, better, faster and stronger than any other system we know. Riding out storms and sharing risks across billions of people is a feature, not a bug, and the affluent capitalist nature of our institutions puts us in a better position to deal with them.
Milton Friedman liked to point out that exports are things we produce but don’t get to consume, while imports are things we consume without having to produce. Yet, when Americans get more stuff from foreigners than foreigners get from Americans, it’s called a “deficit.” Go figure!
Chris Edwards reports that staffing at the FDA has grown 79 percent since 2007 – a rather awkward reality for those who wish to blame the spread of COVID-19 on “market fundamentalists” who’ve caused government to be stripped bare of resources and personnel .