Raymond Richman - Jesse Richman - Howard Richman
Richmans' Trade and Taxes Blog
The Myth of a Global Manufacturing Employment Decline
...The graph rather speaks for itself. It is immediately obvious that total manufacturing employment including the USA, the Rest of the West, and China has been on the increase rather than the decline....
Keep the Focus on Net Exports
The favorite line or political strategy for those who favor trade deals that end up weakening the US economically is that the deal will increase US exports. President Obama bought this line. Many Republicans in Congress have too. The problem is that a focus on exports alone can be deeply misleading.
To think about why, let's start with one of the jokes my father tells periodically about why he quit vegetable and sheep farming in favor of other pursuits.
Exports are a good thing. Exports create jobs for those who work to produce the exports. And they provide countries with the means to purchase imports.
But just as selling pitchforks for less than one paid for them is a recipe for losses and debt, so too is making a deal that raises exports while raising imports much more. The jobs displaced in the import-competing sectors will not be offset by the jobs created by the much smaller gains in the export-competing sector.
Thus, when politicians speak of exports alone without also discussing imports, they ought to be taken to account. How will their proposed policies influence the overall picture of US trade?
Here are some other metrics to keep in mind....
Walll Street Journal's Recent Bias Against Trump Revealed By Its Editor
Wall Street Journal editor-in-chief Gerard Baker on 1-5-2017 wrote an opinion piece entitled “Trump, ‘Lies’ and Honest Journalism” in which he argues that when he defended his advice to the press to “be careful about using the word ‘lie’. ‘Lie’ implies much more than just saying something that’s false. It implies a deliberate intent to mislead.” “Mr. Trump certainly has a penchant for saying things whose truthful is, shall we say for now, challengeable” and “Given the number of times Mr. Trumps seems [sic!] to have uttered falsehoods” and “Mr. Trump has a record of saying things that are, as far as the available evidence tells us, untruthful: thousands of Muslims celebrating 9/11 on the rooftops of New Jersey, millions of votes cast illegally in the presidential election, President Obama’s supposed foreign birth” and “When Mr. Trump claimed that millions of votes were cast illegally, we noted, high up in our report, that there was no evidence for such a claim. No fair-minded or intelligent persons was left in any doubt whether this was a truthful statement.” He writes further, “Now, I may (sic!) believe that many of the things Mr. Trump has said in the past year are whoppers of the first order. But there is a difference of believing that, with reason (sic!)—my induction from knowledge of the fact—and reporting it as a fact. The latter demands a very high standard of reporting.” And finally, he concludes, “What matters if that we report the story and that we find the truth. It’s our job also to point out when candidates, presidents, chief executives, public officials or other s in the news say things that are untrue. But I’m content for the most part to leave the judgment about motive—and mendacity—to our readers, who are more than capable of making up their own minds about what constitutes a lie.”...
George Washington’s Farewell Address Had More to Say Than Avoid Entangling Alliances
In Washington’s Farewell Address 1796, the most frequently quoted passage is his admonition that the USA should avoid entangling alliances. On entangling alliances, he wrote, “It is our true policy to steer clear of permanent alliances with any portion of the foreign world…Taking care always to keep ourselves by suitable establishments on a respectable defensive posture, we may safely trust to temporary alliances for extraordinary emergencies.” He wrote: “Observe good faith and justice towards all nations; cultivate peace and harmony with all. ..In the execution of such a plan, nothing is more essential than that permanent, inveterate antipathies against particular nations, and passionate attachments for others, should be excluded.” What would he think of NATO and our bringing countries bordering Russia into a military alliance directed against Russia? Any NATO country could conceivably force us into a war with Russia.
Another area of concern to Pres. Washington was foreign trade. Regarding trade with nations, he wrote, “The great rule of conduct for us in regard to foreign nations is in extending our commercial relations, to have with them as little political connection as possible… constantly keeping in view that it is folly in one nation to look for disinterested favors from another; that it must pay with a portion of its independence for whatever it may accept under that character; that, by such acceptance, it may place itself in the condition of having given equivalents for nominal favors, and yet of being reproached with ingratitude for not giving more. ...
The Corporate IncomeTax Is the Worst Tax Ever Invented
The corporate income tax is the worst tax ever invented. Economists who have studied and written about its incidence, that is who actually pays the tax, agree that it varies from industry to industry. Monopolists pass the tax on to consumers so that although they appear to be paying the tax they do not bear the burden of the tax. It even varies among monopolists depending upon how much competition they have from competing products. It even varies among firms in highly competitive industries like supermarkets. Some have some monopoly power depending on their location and the number of supermarkets in their vicinity. The corporate income tax violates every principle of taxation. Not only does much of it fall on consumers, but the tax penalizes workers who depend on pensions and IRAs, etc. for their retirement. The income from the wages invested in their retirement schemes is taxed at the maximum rate of corporate tax, currently 35% so their pensions and retirement income is much less than it would be if the tax were 15 or 20% as would be if it is were taxed under the personal income tax. The rich shareholders pay no personal income tax on their corporate income except dividends, and they escape the highest rates by buying back shares rather than pay dividends, a practice that is increasing.
So why don’t we tax corporation as partnerships are taxed. Partners pay personal income taxes on their shares of the partnership’s income. The reason given historically is that corporations have the privilege of limited liability for their shareholders. If the corporation fails, shareholders have no additional liability to what they have already invested in the corporation. But even this argument no longer holds. In most States, perhaps all, partnerships and proprietor ships may elect to be treated as limited liability companies. Increasingly one see the letters LL.C. indicating that only the assets of the company are liable for its debts.
So what is the excuse for a separate corporate income tax with all its inequities and bad economic practices that the corporate income tax encourages. No excuse at all As for the abuses, we’ve written about them in articles on this blog in the past.
An essential companion reform is changing the rules for depreciation under the corporate and the personal income tax as well. ...
In the American Thinker this morning, we suggest four tax changes that Congress could enact to balance the budget and boost the economy at the same time by taxing foreigners:
Our ballpark estimate is that these four proposals would bring the government $465 billion in tax revenue the first year. To read our commentary, go to:
Trump Is Right That the Trade Deficits Have Crippled the U.S. Economy
In its issue of December 19, Barron’s magazine published an article entitled “Tackling Trump’s Trade Plan” written by a member of its staff, Gene Epstein, who holds an M.A. in Economics from the New School. Judging from his article, Epstein appears to know little about the theory of international trade. He begins by writing how awful the Smoot-Hawley Tariff Act of 1930 was. He writes that “U.S foreign trade plunged by 40%, which helped drag the economy into the Great Depression.” That is nonsense. Net Exports, which is the net effect of foreign trade on Gross Domestic Product, was 0.3 billion in 1930, 0 billion in 1931 and 1932 and did not become negative until Pres. Roosevelt’s New Deal policies made it -0.2 and -0.3 in 1935 and 1936. The Snoot-Hawley tariff, contrary to widespread belief by economists and journalists, not only had no effect on the Great Depression which began three years before the tariffs became effective. It has been used falsely to attack anyone who is for balanced trade and opposes free trade. Of course, trade does not need to be balanced with every nation but over time needs to balanced against the rest of the world. A look at the Bureau of Economic Analysis’ Gross Domestic Product accounts shows that the U.S. has been suffering chronic trade deficits for decades, which has converted the U.S. from the world’s leading creditor to the world’s leading debtor since about 1985, halved the economic growth rate, and caused the loss of millions of good-paying U.S. manufacturing jobs. Our principal trading partners pursued a trade surplus policy to promote their economic growth at our expense.
When trade is balanced, all trading partners gain from trade, obtaining goods they value more by trading for goods they value less. When trade is unbalanced the trade surplus country trades some of its goods for an IOU of the other. Japan used those IOU’s to buy productive assets already in existence in the U.S., the Rockefeller Center. China and others have been buying U.S. businesses. Buying U.S. real estate and existing businesses does not create demand for U.S. labor. The U.S. by running chronic trade deficits with the rest of the world is not exchanging goods it values less for goods it values more. It is increasing employment abroad while decreasing employment at home. ...
COMMENTS ON THE NEWS OF THE DAY
Two items dominate the news today. The first and occupying the most time on television and space in the printed media are the “leaks” from the CIA that it believes Russian hacked the DNC and provided WikiLeaks with the emails that embarrassed Hillary Clinton’s campaign and caused so many voters to support Trump. Presumably the Russians got the FBI to call attention to Hillary’s posting classified information on her internet servers which also influenced many voters. And no doubt the Russians were responsible for the turnout of more than 60 million voters who voted for Trump. My own view as a person who served as Executive Officer of a B-17 Bomb Squadron which conducted nearly 200 missions over Germany during World War II, is that Russian intelligence if it did not try to help defeat an American administration that got its Baltic neighbors to join in a military pact aimed at Russia and which helped overthrow a government in the Ukraine, Russia’s neighbor. a nation to whom Russia had granted territory housing Russia’s major naval base on its Southwestern, would be derelict in its duty to defend Russia’s interests. Russia has no reason to believe that Trump will change U.S. policy other than the fact that Trump has indicated a willingness to treat Russia civilly as Presidents G.W. Bush and Barack Obama did not.
The CIA has a history of intrusions in domestic politics and in the internal affairs of other independent nations to affect elections and overthrow governments. One could argue that is its duty to promote the interests of the U.S. abroad whatever the means. The CIA brought down a Republican President once before by leaking information that forced Richard Nixon to resign the presidency. ...
COMMENTS ON THE NEWS OF THE DAY
Democrats and Never-Trump Republicans want an investigation into Russian hacking of the Democratic National Committee’s emails, believing, probably falsely, that the Russians were responsible for the leaks that may have influenced the election in favor of Trump. But the leaks especially Wiki-leaks only revealed e-mails that were never denied. They contained news that the American people were entitled to know. Trump’s victory was a populist, i.e., popular, event similar to Brexit in the U.K. and the recent elections in Italy. If the leaks were the result of Russian hacks, Russia should be thanked by the U.S. Congress on behalf of the American people for revealing the corruption within the Democratic Party, extending up to its chairwoman. Let’s hope we have more hacks that reveal corruption in Washington and anywhere else. If our intelligence is not hacking Russian emails, it should. U.S. intervention around the world is clear to see. We and NATO, our creation and principal supporter, supplied weapons to rebels in Yugoslavia, Libya, Syria, and others, organized the overthrow of the legally elected pro-Russian government of the Ukraine, recruited into NATO countries neighboring Russia. Imagine what they would be saying if Russia were join Cuba, Mexico, and Venezuela into a military pact. Revealing the results of hacking may be a sin only when it does not reveal public corruption.
Democrats and the Never-Trump Republicans and most of the media are saying how awful it is that Trump is appointing qualified skeptics civilians and former generals to cabinet posts. In their view, he should be appointing politicians, who as a group organized the decline of America from its former greatness, promoted the fallacious ideas that global-warming is man-made, that carbon dioxide in the atmosphere causes global warming, and the idea that raising the minimum wage is good economics, etc. That these are fallacious ideas has been pointed out on this blog repeatedly. ...
Policies President-Elect Trump Needs to Reconsider
There are several policies that President-Elect Donald Trump appears to have failed to think through. The following are some of those that we believe he has given insufficient thought to. These need to be brought to his and his advisors' attention.
First, the U.S. trade deficits need to be reduced, not by deals with each country or threats to American manufacturers re-locating their factories abroad but by the simple expedient of single-country-trade-balancing tariffs. China and all other countries want to grow their economies. It is not up to the U.S. or the World Trade Organization to mandate the policies they should pursue. Free trade is nonsense except where there is a common currency, no impediments to the flow of capital and labor, and no barriers to trade. Governments, even international agencies have no right to force independent nations into a single mold. Countries may adopt mercantilist policies such as tariffs and artificial barriers to imports, subsidies to exports, and currency manipulation but the remedy is not to go to great expense of time and money to prove and litigate such practices and mandate their elimination as the WTO was created to do or to negotiate their elimination as the president-elect wants to do. Every country has the right which is authorized by all multi-lateral international trade agreements to impose a trade-deficit-balancing- tariff. The tariff should be on all goods coming from the trade-surplus country not merely on imports of U.S. companies that have re-located factories there. The mechanism is simple as described in our book Balanced Trade (Lexington Books, 2014). Trade deficit countries have little to fear from such trade-balancing; trade- surplus countries are at an extreme disadvantage and their threats of a trade war hardly worth considering. An argument frequently made is that consumers will suffer which is hardly worth considering given that American workers suffer unemployment from the trade deficits as we have shown time and time again in our publications.
Second, President-elect Trump has proposed lowering the rates of the corporate income tax to make U.S. corporations more competitive. Unfortunately, the ownership of the shares of corporations is highly concentrated so cutting the corporate income tax will worsen the distribution of income and wealth. There is a simple solution. Eliminate the corporate income tax entirely and tax corporate earnings as personal income. Even with a cut in personal income tax rates, proposed by Mr. Trump, total revenues will be unaffected. ...
Trump's First Priority Should Be to Balance Trade
The real drag on the American economy since the 1970s has been the foreign trade deficits and the multilateral trade agreements which caused the loss of millions of American manufacturing jobs, the movement of thousands of American companies overseas, and converted the U.S. from the world’s leading creditor to the world’s leading debtor. Balancing U.S. trade with the rest of the world is the only economic policy capable of restoring the U.S. economy and making the U.S. really great again. All the other Trump initiatives will do some good but cannot arrest the decline of the American economy and the stagnation and reduction in the American standard of living. These facts are concealed by the booming stock market which is based on unrealistic expectations. Without balancing trade, the decline in American power and economic well-being will end in a political Armageddon. ...
Are Trade Agreements Necessary?
Most economists are believers in free trade but there is nothing in economic theory that justifies a free trade policy. There is plenty of international trade theory that shows that balanced trade is beneficial to trading partners but there is no economic theory that justifies free trade and then only when special conditions apply. Chronic trade deficits are to be avoided because they usually involve loss of jobs and growth in the trade deficit country in favor or gains in jobs and growth in the trade surplus country. Free trade between countries is justified only when the countries have the same monetary unit, labor and capital are freely mobile between the countries, and none of the countries impose barriers to the free movement of goods. In effect, all the countries involved are in a common market. This is the case in the U.S. where the Constitution imposes these obligations on the States.
U.S. economists have always favored increased trade between nations. When the U.S. experienced chronic trade surpluses, American economists opposed protective tariffs arguing for free trade. But they failed to distinguish between free trade and balanced trade. Prof. Milton Friedman is often quoted as favoring free trade but that was when the U.S. enjoyed chronic trade surpluses. Another great economist, Prof. John Maynard Keynes was an advocate of free trade but when the U.K. experienced chronic deficits, he stated that Britain should not tolerate being the victim of beggar-one’s neighbor policies pursued by countries to gain chronic trade surpluses at the U.K.’s expense.
The movement toward freer trade gained impetus with the inauguration of the series of General Agreements on Tariffs and Trade in 1947 culminating in the conclusion of the Uruguay round in 1994, and the creation of a new international agency, the World Trade Organization in 1995. What characterized these agreements is that they were all called “free trade” agreements even though countries continued to levy tariffs and impose non-tariff barriers on imports and to subsidize exports. As a result of the trade agreements, the U.S. in particular began to experience chronic trade deficits. In a paper written in 1995, I wrote:
It's Morning in America 2.0 -- Peter Navarro in SF Chronicle
Peter Navarro, Trump's chief economic advisor, had a commentary about Trump's election victory (It's Morning in America 2.0) in which he made the case that the Trump administration will lead to an economic resurgence. He states that the Trump program will create a stimulus to the economy in four ways:
Regarding Trump's trade policy he wrote:
Joseph Wharton is smiling down on Donald Trump
Joseph Wharton founded the Wharton School of Business at the University of Pennsylvania in order to insure that America would protect its industries from the economic attacks of other nations. Michael Lind pointed this out in a 2011 commentary:
Recent presidential candidates of the Democrat Party have promised, when running, to protect American industries from foreign attacks, but once elected, they have failed to do so. As Lind noted humorously:...
How the Media Show Their Anti-Trump Bias and Why I Favor Trump
You may believe that the media is anti-Trump because they believe he is unqualified to be President. Nothing is further than the truth. The real issue is his position on foreign trade. Free trade has become a Republican and Democratic ideology. There is nothing in economic trade theory that suggests free trade is an appropriate public policy unless the following conditions exist: the trading partners have a common currency, there is free movement of capital and labor, and no trading partner can impose artificial barriers to trade on imports from the other. The only place where these conditions hold is between the States of the USA because the U.S. constitution mandates them. Of course, multi-nationals are for free trade; it is the source of great profits.
And they favor globalization because it reduces the sovereign power of national governments. You did not hear a peep from any of them when the World Trade Organization ordered the U.S. government to rescind a law that the U.S. congress enacted requiring meat products to be labeled to show the country of origin. Can you believe that the U.S. Congress complied? And the U.S. media with the exception of Fox News, the Washington Times, and a few others fall in line with the desires of the multi-nationals as does the pre-Trump leadership of the Republican Party and the current leadership of the Democratic Party. Take as an example of media bias the following analysis of a single edition of a formerly conservative newspaper.
I read the Tribune Review, Pittsburgh edition, published on November 6, 2016, two days before the national presidential and Congressional elections, and what did I read? No news at all about the positions of either Donald Trump or Hillary Clinton. ...
CERN Study Casts Doubt on Man-made Global Warming
The following article appeared in London's Sunday Express in May, 2016. I came across it while browsing on Google. I found no reference to the study referred to in any American news source. The study casts doubt on the validity of the belief that the use of man-made fossil fuel is the major contributor to global warming much of which occurred before man began using fossil fuels. The assertion that scientists are in agreement with the notion that man-made global warming is principally responsible for global warming appears to be utter nonsense. The study has not been publicized in any American journal or news source that I have been able to find. A leading study of the negative effects of global warming world-wide showed that the U.S. would be one of countries least affected by global warming in the next century. Until more research is done and it is reasonably certain that man-made fossil fuel emissions are the major or a significant cause of global warming, it is foolish to spend hundreds of billions of dollars world-wide measures to reduce fossil fuel emissions. The U.S. and the States give subsidies and tax benefits to the wealthy producers of so-called "clean fuel" a number of whom are not even American-owned and forces utilities to pay high prices for the electricity they produce. And it gives tax credits to the wealthy consumers of Tesla and other electric and hybrid motor vehicles.
CERN is the largest nuclear research institution in, the world. The leading CERN researcher on the cause of climate change is a British scientist Jasper Kirkby. The article follows:
Has climate change been disproved? Large Hadron boffins cast shock DOUBT on global warming
MANKIND'S burning of fossil fuels may not be the primary cause of global warming, according to the shock results of a new study by scientists behind the Large Hadron Collider (LCH).
By JON AUSTIN
Real Income Tax Reform Is Taxing Corporate Earnings As Personal Income
Although tax reforms have been proposed by all candidates for President in the primaries, they all fall far short of what most economists would propose. It is not tax reform to impose a flat tax as Sen. Cruz and others have proposed or to eliminate the estate tax as a number of Republicans have recommended. The proposals would simply eliminate all progressivity from the tax system. The personal income tax and the estate tax are the only taxes that reduce income inequality and wealth inequality in a free market system. It is not tax reform to propose a value-added tax as Pres. Obama once briefly suggested and his rival Romney said he was considering it. The VA tax, widely used in the Euro community and promoted by the IMF for every country in the world is not appropriate for countries with a federal system of government. It is a sales tax and nearly every one of the States in the U.S. imposes a sales tax. Sales taxes should be left to the States.
Real reform must call for abolition of the corporate income tax and taxing corporate earnings as personal income under the personal income tax. None of the candidates for President have proposed doing so. Instead they propose reforms that are not real reforms at all. ...
Trump is Correct: GDP Growth Lowest since 1929-1939 - my blog entry in American Thinker this morning
Here's a selection:
During Sunday’s presidential debate, Republican candidate Donald J. Trump claimed that the U.S. GDP growth rate is the lowest since 1929....
The usually accurate Breitbart fact-checkers held that this claim was “hyperbole” and “mostly false.” However, the average growth rate in real GDP during the period from 1929-1939 was 1.3% per year. The average growth rate from 2005-2015 was 1.4% per year. Every decade in between has had higher growth than 1.4%, as shown in the graph below:
Comments on News You May Have Missed
From web site, www.zerohedge.com. "Everything You Hear About Aleppo Is Wrong" by Tyler Durden. "The United States, on the other hand, continues to play a dangerous game in pushing this war further than it needs to. The United States-led coalition has no legal basis to be operating militarily in Syria, whether through their own domestic legislative institutions or through the United Nations. Russian assistance was requested formally by the Assad regime, which currently holds the seat at the U.N. This gives the Russian campaign an air of legitimacy whether or not it is immoral.
Yet the United States continues to give itself a special privilege (which only Israel can rival) by insisting the U.S. military has the right to defend itself against Russian anti-missile defense systems within Syrian territory. Yet, they argue, the Syrian regime does not have the right to defend itself against multiple ground and air invasions within their own country. (Bold type is in the original article.)
From Pittsburgh Trib-Review. In an opinion piece entitled "Discrimination & Free Markets", Prof. Walter Williams of George Mason University writes that Government intervention in South Africa maintained economic and social discrimination against blacks until Apartheid was ended. But it was not merely the ending of Apartheid that improved the status of blacks but adoption of some free market reforms. He writes, “in free market settings one is apt to observe less racial discrimination because it is costly to both the discriminated and the discriminator.” And he writes, “From the 1860s into the 1960s, the majority of American states enforced segregation through the Jim Crow laws.” With the end of Jim Crow laws, discrimination against blacks was maintained by mostly market interfering measures such as the Davis-Bacon Act, minimum wage laws and occupational and business licensing regulations. Note: The Davis-Bacon Act and the minimum wage laws were initiated by Democratic Pres. FD Roosevelt under pressure from the then lily-white unions.
From Wall Street Journal. An article in the Business News section entitled, “Tax Credit Powers Wind-Farm Upgrades" reports that wind-farms are highly subsidized by the Production Tax Credit Act recently renewed by a Republican-controlled Congress at the behest of Pres. Obama, who believes that global warming is man-caused despite the fact that scientific studies show it to contribute to a fraction of it, one study estimating it at 15 percent. Texas and California are the biggest wind energy states. The article recites, “In a report last year, the U.S. Government Accountability Office said the Treasury has forfeited more than $8 billion in revenue as a result of the tax credit And faulted Congress for repeatedly renewing the credit without requiring any agency to study its impact on renewable-energy development.”The article does not say so but the same is true of the hundreds of billions of dollars spent on subsidies to solar energy, subsidies to builders of hybrid motor vehicles, and to homeowners and businesses in expenditures to reduce electricity consumption. The Republican Congressmen and Senators should the described as RINOs, Republicans in name only) ...
Comments on some news items you may have missed
Today’s date, 10/6/2016. Some news you might have missed!...
Trump won 1st debate trade fight
There were many things wrong with Trump's tactics in the first debate. But he did accomplish one of his strategic goals. He moved the polling needle on trade.
The CNN / ORC poll asked several questions about which candidate would better handle a series of issues. One of the issues was trade. In both prior outings of this question, Clinton had a solid lead: 53:43 in late July for instance. In the post-first-debate poll, Trump had taken the lead: 45 for Clinton, 49 for Trump. Trump's position versus Clinton deteriorated marginally on most other issues. But he won the trade segment.
Veep Debate -- A loss for Kaine and Civility
Civility took a back seat this debate. Since 2012 at least, the presidential debates have headed to the gutter. Interruption contests rather than contests of ideas. I have proposed eliminating the moderator and letting the microphone do the business the moderators aren't of keeping time and preventing interruption. But in the absence of that approach, perhaps we can consider the following. Television networks can probably do this one all on their own. If one of them advertises that they are taking this road next debate, I promise I will watch their feed.
1. Announce that candidates who speak when it isn't their turn will have their microphone muted.
2. Any candidate who speaks out of turn will have their image cut from the screen -- the camera will just show the opponent.
3. If candidates persist in violating the rules, change the angle and cut to the moderator when candidates interrupt.
Implementing this will merely require a few seconds of lag and an agile crew managing the video and audio feeds. If done right, no one outside of the auditorium of the debate need ever know that one of the candidates lacked the basic self control and decency to wait until the opponent had delivered a sentence and exhausted the allotted time.
As it is, the debates have become an embarrassment. A display of bullying disrespect rather than an arena for the battle of ideas. At best an audition for the weekend talk show circuit. Perhaps the cross-talk makes for "good television" but it diminishes our democracy. There should be ample provision of time to respond. No quarter should be given, however, to the efforts candidates make to steal time and silence their opponents through snide remarks, repeated interruptions, and similar schoolyard tactics.
The marching orders for Tim Kaine in the VP debate seem to have been to attack relentlessly. But he was miscast for the role. Kaine's basic temper and personality...
Free Trade vs. Balanced Trade - we were published in American Thinker this morning
Here's a selection:
If you want to read it, go to:
The Case for Free and Balanced Trade
In the 2016 presidential campaign, trade has become a major economic and voting issue. For decades both political parties have supported expansion of free trade through trade agreements. So have most academic economists. But a few have urged a policy of balanced trade with the rest of the world. Free trade and balanced trade are not necessary mutually exclusive.
When trade is balanced, all trading partners benefit. Countries can increase that benefit by reducing their barriers to imports, as long as trade remains balanced. Then they will exchange goods that are cheaper to produce in one country for goods that the other country can produce more cheaply. This is called the law of comparative advantage. Both countries benefit. David Ricardo pointed this out in the early 1800s.
But what happens when trade is not balanced? Is free trade still a good thing? Unfortunately, U.S. policy makers in Washington have thought so and so have most economists. They are wrong. The U.S. economy has been suffering annual trade deficits for decades that resulted in economic stagnation, slower than normal economic growth, and the loss of millions of manufacturing jobs. The Table below shows how the trade deficits for selected years during the period covered by the foregoing graph caused a reduction in Gross National Product and led to slow growth. The slow U.S. economic growth rate of the last 17 years is unprecedented. From 1999 through 2015, the average U.S. growth rate was just 2.1% per year, as compared with over 3% for almost every ten year period during the previous 5 decades.
The following table shows how negative net exports reduced Gross National Product during selected years from 1960 to 2015 ...
Getting the moderators out of the presidential debates
I recently wrote a piece on presidential debate format for the Washington Post Monkey Cage blog. Here's how it begins.
Donald Trump recently picked up a suggestion that I made last year, a suggestion that was also made by a blue-ribbon, bipartisan group of campaign hands: Presidential debates be conducted without a moderator. It’s an idea worth thinking seriously about. Removing the moderator could well make debates faster, deeper, more informative, more interesting and more revealing...
Journal of Economic Literature:
Atlantic Economic Journal: