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Bonus Quotation of the Day…

… is from page 114 of Ludwig von Mises’s 1938 paper titled “The Disintegration of the International Division of Labor” as this paper appears in Money, Method, and the Market Process: Essays by Ludwig von Mises (Richard M. Ebeling, ed., 1990):

The theory of foreign trade as stated by Ricardo has proved in an irrefutable way that free trade only ensures the highest productivity of the economic efforts and that every kind of protectionism must necessarily result in a reduction of the output of capital and labor. For a hundred and twenty years a flood of books and pamphlets has endeavored to invalidate the teachings of this theory and to show that some good might be reaped from protection. They have all failed. They could not disprove that as far as the supply of the consumer with commodities and services is concerned free trade is more efficient than any other system. Never has any proposition been brought forward that could shake the foundations of the free trade doctrine.

DBx: Of course, protectionists deny that all arguments for protectionism have failed. But their denials reveal only their preternatural inability to grasp the most basic elements of economic logic.

Someone who is utterly convinced that lead can be turned into gold will never accept the reality that such a transformation is impossible. This person will falsely (if sincerely) assert that such transformations have occurred and can occur again if only more people believe in, and practice, alchemy. This person gets haughty when others refute the nonsense that he passionately peddles, and he becomes downright furious when this nonsense is treated with the full measure of disrespect that it deserves.

The same is true for someone who is utterly convinced that the leaden burden of artificially intensified scarcity can be turned into the gold of greater abundance. Protectionism is economic alchemy.

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