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Palin calls for balanced trade
Howard Richman, 6/7/2011

The Los Angeles Times reports that Governor Palin met with Donald Trump during a May 31 visit to New York. In her remarks, she told reporters that she advocates balanced trade arrangements:

"What do we have in common? Our love for this country, a desire to see our economy put back on the right track," Palin told reporters. "To have a balanced trade arrangement with other countries across this world so Americans can have our jobs, our industries, our manufacturing again. And exploiting responsibly our natural resources. We can do that again if we make good decisions."

Palin is now the only candidate with a program for putting America back to work. The media like to pretend that she is dumb. But the truth is that she has common sense. The American people respond to that sense when she talks to them directly, as she did when she won the the October 2, 2008, Vice Presidential debate. (If you're not convinced of the debate outcome, watch this focus group.)

Some commentators put Palin in the same category as Minnesota Congressman Michele Bachmann, since both advocate balanced budgets and enjoy Tea Party support. But Bachmann lacks common sense. In fact, she is an ideological free trader. In a blog entry, Bachmann wrote:

Furthermore, the role of free trade as an expression of liberty and opportunity for all individuals signifies the very principles our country was founded upon....

What nonsense! The American government was founded upon tariffs, which were enshrined in the U.S. Constitution as a chief way for the federal government to collect revenue.  Bachmann doesn't even know her history!

But it is the future that concerns me. Bachmann would continue giving American industry away to China and the other mercantilist countries for ideological reasons. In contrast, Palin advocates balanced trade arrangements which would lead to the recovery of American industry and the resumption of American economic prosperity.

I hope that Palin seeks out economic advice from others who have the common sense to advocate balanced trade, people like Tea Party congressional candidate Jack Davis, a 78-year-old self-made manufacturer. In a May 15 speech, Davis briefly outlined his career:

I served in the Marine Corp and as an officer in the United States Coast Guard. In 1964, I founded the I Squared R Element Company which I own and manage.  I started the company in my garage.  Our United States competitors were two large multinational corporations, Carborundum and Norton.  Everyone said I would not survive. Well I proved them wrong.  Those multinational corporations no longer exist and my company is thriving. I Squared R is the world-leader and now the only United States manufacturer of silicon carbide heating elements.

Like Palin, he is an advocate of more balanced budgets and more balanced trade. Later in the same speech, Davis pointed out:

American companies will not hire American workers until they have a level playing field. Manufacturing companies need trade balancing tariffs to be competitive with the predatory trade policies of foreign countries, like China…. The White House and Congress are controlled by the money from multinational corporations and by Wall Street. They will not control me. I cannot be bought.

Good economic advice is hard to find. If Palin is looking for an adviser with common sense who can draw from vast experience in the real world economy, Davis could be her best possible choice.

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Comment by M, 6/9/2011:

Palin may be smarter than her rivals.  If she replaces Obama, she would still require the co-operation of her party and the opposition party to pass any legislation resembling the scaled tarriff. It's nice she can discuss the problem and reference a vague solution, but what is her plan to form a coalition to defeat the money power that holds sway in every Capital? 

Response to this comment by Howard Richman, 6/9/2011:
M: The President already has the authority to apply tariffs without requiring congressional approval. Also, any measure that would solve our trade problem would be very popular because the American would back what Lou Dobbs calls: "Mutual reciprocal balanced trade."

Comment by Bruce Bishop, 6/19/2011:

Dr. Richman,

Thank you for taking up this cause.  I just discovered your website and am delighted that you have introduced the concept of "balanced trade" into the discussion.  I have been frustrated by people blaming "free trade" for our job losses when our relationship with Communist China is NOT free trade.

Communist China is a criminal enterprise that is stealing our jobs by avoiding any consideration for human rights, worker safety, product safety or the environment.  They also steal our intellectual property and sell it back to us with no qualms.  You might even say that they are using slave labor, since their "minimum wage" is about one twentieth of our minimum wage.

Everything that can be manufactured will be manufactured in China, and there will be almost no manufacturing jobs left in the United States.  Manufacturing jobs allowed high school graduates to earn a middle-class income, along with benefits (health insurance, paid time off, pensions) so that one spouse could work while the other stayed home to raise the kids and keep house.  Now, it takes two or three of the remaining jobs to support a middle-class lifestyle.

I don't believe that our government is so stupid that they didn't realize this was happening.  I believe that the "Progressives," in both parties, see the end of the middle-class as an opportunity to make a super-majority of the voters dependent on the government for support.  Once we reach that point, there will be no chance for a turnaround to restore fiscal sanity and conservative values to our ruling class.  I believe that we are on Friedrich Hayek's "Road to Serfdom."

Comment by Ted Birnbaum, 7/2/2011:

Thank you very much for this article...I wasn't aware that Sarah Palin was for balanced trade...and I wasn't sure about Bachmann's position. Now if we can just overcome the main stream media's portrayal of Palin. I suspected Palin had common sense...but was put off by her support of John McCain. I just emailed you, before reading this article...requesting information like now you have answered some of my questions...thank you, again.For those who'd like to see the outline of a practical Libertarianism...see


Comment by Mike, 7/14/2011:

Wow...and I was liking Bachmann.  Can she be convinced to change her views?

Comment by Joseph Hitselberger, 8/32/2011:

The comment about Bachmann was unnecessarily harsh.  In the full article Bachmann was bringing to light the problems of the trade deficit.  Both Howard Richman and Michelle Bachmann would agree on the problems of the trade deficit and it is silly to criticize a prospective ally in this way.  Moreoever, it is quite conceivable that Bachmann was referring to the ease of trade among the states and colonies in the 18th century, rather than international trade as Richmann seems to think.  In that respect, free or easy  trade among the states can  indeed be considered to be a principle upon which this country was founded.

I don't support Bachmann.  As far as I can see, she does not put the trade deficit in her top priorities and speaks more toward spending and the federal deficit.  She may be among the many politicians who do not fully appreciate the relationship between the trade deficit and the federal deficit.  But, as she realizes some importance of the trade deficit, it's possible she might be convinced on the "scaled tariff" is she knew the arguments and the economic history.


Im summary, this is a "whoops" by Richman.

Response to this comment by Howard Richman, 9/8/2011:
Joseph, I just reread Bachman's blog posting. You are correct that she expresses concern about our large trade deficits. Her solution is more free trade agreements.  

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  • [An] extensive argument for balanced trade, and a program to achieve balanced trade is presented in Trading Away Our Future, by Raymond Richman, Howard Richman and Jesse Richman. “A minimum standard for ensuring that trade does benefit all is that trade should be relatively in balance.” [Balanced Trade entry]

    Journal of Economic Literature:

  • [Trading Away Our Future] Examines the costs and benefits of U.S. trade and tax policies. Discusses why trade deficits matter; root of the trade deficit; the “ostrich” and “eagles” attitudes; how to balance trade; taxation of capital gains; the real estate tax; the corporate income tax; solving the low savings problem; how to protect one’s assets; and a program for a strong America....

    Atlantic Economic Journal:

  • In Trading Away Our Future   Richman ... advocates the immediate adoption of a set of public policy proposal designed to reduce the trade deficit and increase domestic savings.... the set of public policy proposals is a wake-up call... [February 17, 2009 review by T.H. Cate]