The United States needs to export more and import less to get rid of our troublesome trade deficit and create jobs --- right? Our trade deficit with China is ruinous, isn't it? They just won't buy our stuff! The Chinese practically own us already, and it's just getting worse. We're exporting our jobs to China, aren't we?
Here, Becker and Posner sort out these old chestnuts and a few other issues that have kept making the rounds at cocktail parties and backyard barbecues for the last 200 years or so. Just change the name of the trading partner of the day from China to Japan to England, and you'll get most of the 200 years covered. One has to wonder why we can't all just learn the truths that Becker and Posner so aptly explain and move on for the rest of our existence.
Bottom line; once again, voluntary exchange cannot be a bad thing, even when the trading goes on across political borders. But trade policies like those proposed by BHO seem to appeal to a lot folks. How can we explain that outcome, given the clear, straightforward explanations rehearsed by Becker and Posner? I am mystified.
By the way, I have a long-time, continuing trade deficit with the lady who cuts my hair. She never buys anything from me! Clearly a problem, isn't it? Since she won't buy anything from me, I should quit buying from her, right? That's what BHO proposes, anyway.