Here’s a letter to AP Fact Check.
Editor:
Melissa Goldin does a deep dive into the cause(s) of the U.S. “agricultural trade deficit” (“FACT FOCUS: Trump blames Biden for the agricultural trade deficit. It’s not that simple,” December 10). To what extent is this “deficit” caused by the policies of Biden? To what extent is it caused by the policies of Trump? To what extent are the policies of foreign governments to blame?
Busy studying these trees, Ms. Goldin fails to understand the forest, which is that there is no economic relevance whatsoever to an ‘agricultural trade deficit.’ None. Nothing in economics remotely suggests that a well-functioning economy will or should export more agricultural products than it imports.
These “trade deficits” are especially unsurprising for economic entities, such as the U.S. economy, that, like Mr. Trump’s own business ventures, overwhelmingly specialize in producing services. (What is surprising is that the U.S. for so long ran “agricultural trade surpluses.”) Therefore, an exploration of the cause(s) America’s “agricultural trade deficit” is as pointless as would be an exploration of the cause(s) of Mar-a-Lago’s “agricultural trade deficit.”
There’s nothing here demanding an explanation and no problem needing a solution. Yet by treating “agricultural trade deficit” as a meaningful economic concept with relevance for policy, such an exploration as carried out by Ms. Goldin only lends unwarranted credence to Trump’s and other protectionists’ misuse of meaningless trade statistics to justify unjustifiable protectionist measures.
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
