President Trump announced today that he could consider cutting regulations by at least 75%. This is a welcome development considering that many of the economic issues that exist today are related to government interference in many industries.
However, Trump supplemented sound economic and government policy with his idiotic reliance on protectionism. He announced today that he would sign executive orders calling to renegotiate the North American Free Trade Agreement (NAFTA) and withdraw from the Trans-Pacific Partnership.
According to Trump and some of his supporters, these free trade agreements have strangled American workers and outsourced manufacturing jobs, leading to the decline of the Rust Belt over the past few decades. However, studies indicate that automation is the bigger cause for the loss of manufacturing jobs more than the free trade agreements that resulted in lower-wage labor.
Furthermore, Trump indicated that he would create tariffs for companies that outsource jobs to the United States, saying “if you go to another country…we are going to be imposing a very major border tax.”
Trump’s economic policies contradict economic reality that free trade helps not only Americans but also our trade partners. In fact, free trade is a hallmark of the freedoms that the United States should encourage rather than prevent in the name of political expediency. As Mark Perry of the American Enterprise Institute wrote last March, quoting Milton Friedman:
Trade is not invasion. It does not involve aggression on one side and resistance on the other, but mutual consent and gratification. There cannot be a trade unless the parties to it agree, any more than there can be a quarrel unless the parties to it differ. England, we say, forced trade with the outside world upon China, and the United States upon Japan. But, in both cases, what was done was not to force the people to trade, but to force their governments to let them. If the people had not wanted to trade, the opening of the ports would have been useless.
“Trade is not invasion. It does not involve aggression on one side and resistance on the other, but mutual consent and gratification.”
Mark Perry of the American Enterprise Institute
If Donald Trump is serious about helping American workers and protecting freedom, then he would not encourage protectionist policies that will only harm our country rather than help it.
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