On my Fox Business show this week (Thursday @ 8pm & Midnight ET), I fight about free trade with Lou Dobbs, who says he prefers "balanced trade". (He also called me a "self important ass".)
Trade is win-win. Two people trade only because each values what he gets more than what he gives up. That's why in a store both customer and clerk say, "Thank you." But when an international barrier is established, people forget that obvious truth.
President Obama started a "trade war" with China over cheap tires they want to trade with us. That is lose-lose.
My colleague at Fox, former Gov. Mike Huckabee has said a country can only be free if we can feed ourselves, fuel ourselves and fight for ourselves...when we start outsourcing everything, that's a road to being enslaved.
In fact, as China learned, such self sufficiency is a road to stagnation.
In my syndicated column this week, I interview Tom Palmer of the Atlas Economic Research Institute. Here’s some of his take on that:
"I hope that Gov. Huckabee thought about that when he was governor of Arkansas, and made sure there was no jobs outsourced to Virginia or Texas," Palmer replied. "He should have protected the people of Arkansas, right?"
But that's different. We can count on Pennsylvania in a time of war. I don't know that I can count on China.
"If you're trading with them, it makes war much less likely," Palmer said. "We're not going to go to war with Canada. It's our biggest trading partner -- $600 billion a year going across the U.S.-Canada border in trade along the longest non-militarized border in the world. Five thousand miles, counting Alaska. That is trade creating peace."
As the French economist Frederic Bastiat put it, "When goods don't cross borders, soldiers will."
Palmer offered another way to think about trade: as a machine -- "a machine that allows Florida farmers to turn oranges into (phones). They can't grow cell phones on their trees in Florida. They grow oranges really well. What they can do is take those oranges and trade them for cell phones."
And when people do this worldwide, they get richer. "Just like the case of you buying some coffee at the Starbucks. You could have made your own coffee. But your time might have been better spent doing something else. So you outsourced your coffee production. You made yourself better off. And that young lady who sold you the coffee made herself better off."
Full column here.