Trump Silver Lining: Liberals Are Now Defending Trade Deficits

Thanks to Trump, it appears that some of the Left have discovered economic reality and are defending trade and suddenly seem less unsettled by trade deficits.  Here is Kevin Drum with one in a series trying to downplay panic over trade deficits, in this case with Mexico.    Here are some of my recent thoughts on the trade deficit.

International trade is such an obvious benefit to the country that it is simply incredible that we are, hundreds of years after Adam Smith and Ricardo and Bastiat, still trying to explain and defend it against ignorance.  It's like we have to constantly battle recurrences of the phlogiston theory of combustion.

  • Jim Collins

    The Leftist roaches are scattering because the lights have come on. It's happening all over. The Navy just reversed itself on getting rid of enlisted rates.

  • ErikTheRed

    It's hilarious to me that the deeply and eternally held beliefs of both parties will instantly shift as soon as the other party begins to embrace them. Sort of the way that mandatory health insurance was originally a Republican idea, and first implemented by Republicans (not endorsing it in any way, just still giggling at the hypocrisy over half a decade later).

  • GoneWithTheWind

    Trade deficits are good? Why then does China and Mexico try so hard to avoid them and run a trade surplus. Maybe you should explain this to China, Mexico and most countries that trade deficit are the way to prosperity.

    Of course trade deficits are good for some people. Those who are mining our resources and selling them overseas.

  • johnmoore

    I used to buy the standard "competitive advantage" theory until recently. The problem is that the real world doesn't play along. Countries use various policies to enhance their exports - they are mercantilist, and that breaks the theory.

    On top of that, even if it were pure free trade, their would be winners and losers, and the winners are more diffuse - they get far less benefit per person than the losers get harmed. While one can just ignore their pain, doing that is one reason we now have Trump.

    Like almost any theory that is applied to masses of people, the simplistic free trade economic theory has problems in the real world.

  • TruthisaPeskyThing

    I think that your assertion " mandatory health insurance was originally a Republican idea" may be somewhat misleading. Yes, a Republican governor in Massachusetts signed that into law, but two clarifications are necessary. It appeared to the be least damaging approach given the politics of that state. But more important: for the state to require it could be consistent with the 9th and 10th amendment; for the federal government to require it is a gross distortion of the constitution.

  • ErikTheRed

    You're not looking back far enough - try the Health Equity and Access Reform Today bill from 1993, which included many of the cornerstones of Obamacare, including an individual mandate, government-run purchasing pools, forced standards for coverage, turning "insurance" into socialized risk by requiring preexisting coverage, etc., etc., etc.. Here's a link: https://www.gpo.gov/fdsys/pkg/BILLS-103s1770pcs/pdf/BILLS-103s1770pcs.pdf . In fairness, the bill didn't get a huge amount of traction but it was introduced by a GOP senator and had a solid list of about 20 GOP senators as co-sponsors.

    And quit trying to bury the person who first implemented this abortion of an idea in this country as some sort of random Republican governor - Mitt Romney was the party's presidential nominee not long afterwards. Not like he was some crazy rebel completely out of the mainstream. The fact that it wasn't unconstitutional hardly makes it acceptable (like anyone agrees on what the Constitution means anyway). There's a Grand Canyon-sized chasm between "the right thing to do" and "what we can get away with," and Republic Presidential Nominee Mitt Romney's plan (say his name) is firmly and solidly in the "what we can get away with" category.

    There were other GOP luminaries pushing the individual mandate back in the 90's as well; Newt Gingrich, Rick "Frothy" Santorum, Dan Quayle, The Original Awful Bush President, Bob Dole, Orrin Hatch, and others - basically the idiot "Trust us, we can make big government run efficiently! Because unicorns and rainbows!" crowd.

    I've come to the conclusion that the GOP exists to sell socialism to people who can't bear to be labeled socialists, and they've (unfortunately) done a damned fine job of it.

  • Seekingfactsforsanity

    "All else being equal". Not so much in the real world, and that is the problem. Yet some still try ......................

  • jhertzli

    In the real real world, Japan tried mercantilism and would up stagnating.

  • jhertzli

    All the cool nations are doing this? Isn't that a standard left-wing cliche?

  • johnmoore

    In the real world, Japan didn't match unfriendly tariffs, so that is not surprising.

  • Magua1952

    Enlightened economists: would you kindly identify one nation, city state or empire that engaged in free trade? Just one, in human history, and on planet earth will suffice. Free trade is an abstraction and can only exist if all play by the same rules. They never do so because all people have local interests including the encouragement of profitable manufacturing and exports in their homelands.

    Japan has economic problems but the problems are not due to its powerful manufacturing companies, all jealously protected. Without Toyota, Mitsubishi and others Japan would be a backwater. Every nation strives to become the workshop of the world except our current deluded leaders hobbled by egghead notions such as free trade. We followed mercantilist policies from the beginning, and we had dramatic growth behind high tariff walls. We traded all right but tried to organize trade for the benefit of our nation.

    Free trade could only exist if there was an overbearing and totalitarian one world government. Any representative government will criple attempts at free and open trade. Who believes a one world government would further human liberties?

    People are more than economic units. They are also citizens, Patriots, traitors, mothers and fathers. Economic theory that isn't grounded in history is nonsense. There is no periodic table nor laws of thermodynamics in the dismal profession.

  • Benjamin Cole

    Perhaps International free trade is positive but please please no free trade in my own neighborhood. I prefer strict property zoning and criminalization of push cart or a truck Vending. I am happy to know this reflects the exact position of my peers in the right wing.

  • jhertzli

    This is not what protectionists predicted.