With this understanding, the folly of the Trump tariffs is clear. The tariffs impose taxes on voluntary transactions that are making Americans better off. Like all taxes, the tariffs will discourage beneficial economic activity and will make Americans poorer and worse off.
Believing the myth that trade deficits are bad, the Trump Administration imposed global reciprocal tariffs this week. The proposal threatens to derail economic prosperity and trigger a barn burner of a recession.
The fallacy of this myth can be clearly seen in the U.S. economic data. Over the last half-century U.S. trade deficits shrunk during recessions and increased during economic expansions. This phenomenon could not have persisted for so long if trade deficits harmed economic growth. Instead, there is something else going on.
Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.
An economist explains what trade deficits really mean
Wayne H Winegarden
With this understanding, the folly of the Trump tariffs is clear. The tariffs impose taxes on voluntary transactions that are making Americans better off. Like all taxes, the tariffs will discourage beneficial economic activity and will make Americans poorer and worse off.
Believing the myth that trade deficits are bad, the Trump Administration imposed global reciprocal tariffs this week. The proposal threatens to derail economic prosperity and trigger a barn burner of a recession.
The fallacy of this myth can be clearly seen in the U.S. economic data. Over the last half-century U.S. trade deficits shrunk during recessions and increased during economic expansions. This phenomenon could not have persisted for so long if trade deficits harmed economic growth. Instead, there is something else going on.
Read the entire the entire op-ed here.
Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.