Mr. Donald J. Trump
President, Executive Branch
U.S. Government
1600 Pennsylvania Ave., NW
Washington, DC 20500
Mr. Trump:
Yesterday on Truth Social you wrote:
I have just been informed that Venezuela is going to be purchasing ONLY American Made Products, with the money they receive from our new Oil Deal. These purchases will include, among other things, American Agricultural Products, and American Made Medicines, Medical Devices, and Equipment to improve Venezuela’s Electric Grid and Energy Facilities. In other words, Venezuela is committing to doing business with the United States of America as their principal partner — A wise choice, and a very good thing for the people of Venezuela, and the United States.
How is it a very good thing for people of Venezuela to be denied the freedom and opportunity to spend the incomes they earn in ways that they judge best? If The Trump Organization strikes an exclusive deal to sell, say, $50 million worth of branding and marketing services to golf clubs and hotels, would it be a very good thing for you and your family to be obliged to spend all of those $50 million in earnings ONLY on the outputs of those golf clubs and hotels? If not, please explain how an essentially identical restrictive arrangement is good for Venezuelans?
And how is this deal good over time even for Americans? Unable to use their funds from the deal to patronize non-American suppliers, Venezuelans will be unable to enlist non-American suppliers to compete with Americans. This reduction in competition will not only enable American suppliers to charge higher prices to Venezuelans (not a very good thing for Venezuelans), it will also dampen American suppliers’ incentives to innovate – thus ensuring that Americans’ real wages grow more slowly than they otherwise would.
You seem to believe that the key to American economic growth is to protect American producers from competition. Not only does your belief reveal your poor opinion of the abilities of American companies and workers, it’s contradicted by overwhelming historical evidence showing that economic growth is fueled by open competition in free markets, not by government favors.
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
