Should we care that trade is globally inefficient when we impose tariffs on foreign imports if such tariffs allow us to increase production of the import competing products domestically and create additional jobs in the process? Now I have addressed this issue somewhat in at least two or three prior articles, but I want to look at an application that is very much close to home. Recently First Solar, an American firm that manufactures rigid thin film modules or solar panels an

Drawing our attention to the famous Candlestick makers' petition satire on protectionist tariffs by Frederic Bastiat, I summarize the satire and apply it with modifications to the current context of US-China trade relations. You may read the satire here or go to http://bastiat.org/en/petition.html Concern: The sun was bad for the candlemakers' business Petition: That the government would enable a law to prevent the sun from accessing their country so that they could produce c

Going against trade policy advice from his now former chief economic adviser, against pleas from members of his party including key leaders, and against objections from key US political allies, Trump went ahead to impose 25% tariffs on steel imports and 10% tariffs on aluminum imports, excluding temporarily only Canada and Mexico pending the outcome of NAFTA negotiations. This has left many scratching their heads. You do not 'win' Trade wars. So what exactly is Trump gambling

One of the arguments in the trade debate has centered on the assumption that trade between the US and China for instance, has benefitted China a whole lot more than it has the US. As a result the argument is that by imposing these tariffs we create a more level playing field by limiting that benefit and in the process ensuring that US workers are protected. As I have stated in a recent blog post, trade is simply a mutually beneficial exchange among willing parties, the only d

International trade is always a contentious issue and one that is often not well understood. Some see the current structure as heavily biased toward particular multinational corporations and institutionalizing global inequality. Some others see it as a job destroyer in local communities and therefore something that cannot be good. People wonder, is the WTO a good thing? Is NAFTA good for the United States? What about for Mexican workers who have yet to see any significant wag