Four trade deficit myths hurting the economy

As Professor Michael Pettis of Peking University and the coauthor of Trade Wars Are Class Wars argues, countries should export in order to import and increase consumption and the standard of living for their people. This is how comparative advantage and the added economic value of trade is supposed to work.

Much of what free trade has brought about is what gets called “the race to the bottom,” the quest for the cheapest possible wages or agricultural production, with consequent losses on countless fronts. The argument is always that such moves make industry more profitable, but it would be more accurate to say that free trade concentrates profit away

Seeing the world through markets not only distorts our sense of our selves, but projects our own disability onto everyone else.

And don’t give up on logic, intellect, and education, because tight but higher order logical reasoning would show that, unless one finds some way to reject all empirical evidence, advocating regime changes implies also advocating slavery or some similar degradation of the country (since these have been typical outcomes). So these interventionistas

The political truthiness has been flying thick and fast on this subject for decades now. Politicians are taking claims that have a very tenuous connection to economic reality—claims that feel true—and running with them, sometimes out of ignorance, sometimes because of cynical calculation.