Free Trade: An Inconvenient Truth For The Left

If you believe left-wing politicians, free trade kills the American economy.  Corporations ship American jobs overseas, the trade deficit is a sign of weakness, imports are bad, blah blah blah.’s Ronald Bailey reports on a study that should be required reading for for anyone trying to understand trade policy.  In short, open trade policy reduces unemployment.

How?  Bailey writes, “The study suggests that freer trade boosts overall productivity, enabling companies to hire more workers. Trade enhances competition which weeds out inefficient firms and allows more productive ones to expand. As the average efficiency of firms in a country increases, they can earn more revenues by boosting production. And that leads to hiring additional workers.”

Trade is not a zero-sum game.  It’s mutually beneficial to the seller and buyer.  That’s how our standard of living increases.

But that’s not nearly as sexy for pandering lawmakers as their tried-and-true fear mongering.  So protectionism will live on.


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