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 Richmans' Trade and Taxes Blog

Republican presidential candidate Gov. Buddy Roemer would require balanced trade
Howard Richman,

In an interview with Ian Fletcher, Republican presidential candidate Gov. Buddy Roemer said that he would require balanced trade if he were elected president. Specifically, when asked what he would do to end America's trade deficits he said:

So we've got to consider things like a serious tariff to end our trade deficit. Not something I'd rush into blindly, and maybe there's other ways to skin this cat, but I wouldn't flinch at putting a 30 percent tariff on Chinese goods, or a tariff on imports across the board, with the whole world or the countries running a surplus with us. And the interesting thing, of course, is that once the other side knows that, knows that we'd do a tariff, maybe they learn real fast to be a bit more reasonable? But you've got to have a credible threat that you'd do it if you want that "Speak softly and carry a big stick" stuff to work.

When he said that he would consider imposing a tariff upon those countries which run trade surpluses with the United States, he was coming very close to our scaled tariff proposal. The tariffs in that proposal would only be imposed upon those countries which run trade surpluses with the United States. The rate of the tariff would be proportional to the trade surplus, giving those countries an incentive to take down their barriers to American products. Not only that, the scaled tariff would be WTO-legal (For more on this topic, see our article The Scaled Tariff: A Mechanism for Combating Mercantilism and Producing Balanced Trade, just published by the peer-reviewed Journal of International Law and Trade Policy.)

Requiring balanced trade would create about 5 million manufacturing jobs each producing about $100,000 of product. And those well-paid manufacturing workers would in-turn buy services from other Americans. The result would restart American jobs growth both in the short- and long-term. Gov. Roemer, who has an economics degree and an MBA from Harvard, is aware of these effects. In response to the question "How do you feel about the trade deficit?" he said:

It's horrendous, and it's the one big cause of job loss that nobody in the political establishment -- not on the Democrat side, not on the Republican side -- wants to talk about. They're all blathering about expanding exports when it doesn't matter how much we export if our imports just keep going up even more, which is what's been happening. It's only net exports that are going to make a dent in our unemployment, and we're going the opposite direction right now with a trade deficit that is around $500 billion a year or so. That's a jobs plan we could do right now: end the trade deficit, or at least cut it.

Roemer is a former Louisiana governor and a former congressman. Like Governor Sarah Palin he is a populist Republican who opposes crony capitalism and supports balanced trade and balanced budgets. If you would like to find out more about his positions, go to his campaign website: http://www.buddyroemer.com/

Comment by Steven, 2/15/2012: I noticed Roemer immediately after he entered the race. The other balanced traders are (or were) Sara Palin and Donald Trump. I'm not sure where they stand now, because they are quite shy about that part of their views. My impression is that the media will destroy any popular figure which dares to support balanced trade. I'm starting to think that the real problem is bigger. If such a perfectly logical, mathematically precise requirement as balanced trade can't get any air time, we've got a serious political problem and/or deeply flawed financial system. I started investigating the matter and I publish the result on my (ad-free) blog: votersway.com