Here’s a letter to the Washington Post:
Editor:
Brian Deese apparently thinks that if a proposition is repeated often enough its truth is thereby established regardless of contradictory facts and logic (“China already manufactures too much. Now it wants to make more.” April 25). For example, Mr. Deese worries about the “hollowing out of our industrial base” – a worry that in recent years has been expressed bazillions of times, yet never with supporting evidence. So here’s a fact: America’s industrial capacity hit its all-time high in December 2016 and is today (March 2024) a mere 0.1 percent shy of that peak and ten percent larger than it was when China joined the WTO in 2001. So much for America’s industrial capacity suffering a “hollowing out.”
As for Mr. Deese’s logic, it’s il. He asserts that Beijing’s effort to expand Chinese exports “undermines other countries’ ability to maintain their own healthy industries.” This assertion rests on the faulty assumption that the maximum amount of worthwhile economic output that can be produced globally is fixed and, therefore, if one country expands its output it obliges other countries to reduce theirs. To see why this assumption is faulty, ask if we Americans would be enriched or harmed by the emergence of a Chinese Edison. It’s obvious that, if we trade freely with China, we’d be enriched. Nothing from our perspective as Americans is changed if the additional Chinese outputs offered for sale to us on attractive terms are made possible, not by a Chinese Edison, but by Beijing’s economic policies. Either way, we Americans get from China greater value for our exports and the opportunity to shift our production to even higher-valued outputs.
Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030
