The dozen or so people who read Cafe Hayek regularly know that I write a lot about trade and trade policy. Indeed, rarely a week passes in which I don’t get a friendly – and sometimes unfriendly – email entreating me to stop writing about trade. I reply that, for as long as I live, I will write about trade as long as protectionists continue to insist on their right to obstruct peaceful trade. As I live, I will stop writing about trade only when protectionists stop demanding protection. I regretfully, but with complete confidence, predict that that day will never come.
Even though my intelligence isn’t especially impressive, I detest having it insulted. Yet nearly every argument for protectionism is an insult to the intelligence of every thinking person. Even more, I despise having my and my fellow human beings’ freedom to act peacefully held in contempt – and nearly every argument for protectionism treats individual liberty with utter contempt.
……………
Because economists have been pondering and writing about trade for a quarter of a millennium – mostly in response to protectionists who, for all of that time, have insisted on making excuses for their schemes – there has been for decades (perhaps even longer) no new argument for protectionism. Economists have heard them all and have rebutted them all, countless times.
And yet I continue to experience occasional genuine surprise at just how elementary are some misunderstandings about trade and protectionism.
On a Facebook thread today, I was conversing with someone who is sympathetic to protectionism. This person, who admits to not being an economist, is polite and civil, and so I don’t mind engaging with him. At one point in the conversation I asked him to “please explain how a policy that intentionally obstructs a people’s access to goods and services – including goods and services that those people use as inputs in their production processes – makes those people richer?”
He responded with this question: “What goods and services have I been obstructed from?”
Reading his response filled me with despair sparked by the realization that the way that many people think about tariffs and trade is – I can find no good word for it – profoundly different from the way that I and most other economists and advocates of free markets think about trade.
How does someone not see that protective tariffs are designed to obstruct the access of people of the home country to tariffed goods and services? How can someone not see that the very essence of protectionism is obstructing fellow citizens’ access to imported goods and services? Here’s my response, of Facebook, to my interlocutor:
You have been obstructed, most obviously, from access to any goods and services the prices of which are raised by the tariffs. Because of these higher prices, you likely purchase fewer of these goods and services over time than you would have purchased absent the tariffs. If you don’t reduce your purchases of these tariffed (and tariff-competing) goods and services, you will necessarily spend a larger share of your income purchasing these goods and services. In turn, you will necessarily have less income to spend on other goods and services, so your access to these other goods and services is obstructed. That’s the whole point of protective tariffs: to obstruct your and your fellow citizens’ access to goods and services sold from abroad.
To not immediately see that tariffs necessarily obstruct the access of citizens of the home country to imported goods and services is akin to not immediately seeing that 10-2 equals some number less than ten. It’s baffling.
