Mar 10, 2019

Should Government Ban Lightbulbs? An Economic Case for Free Trade

Post by Freedom Partners

Americans benefit enormously from trade. Trade gives us access to a multitude of high-quality goods and services at affordable prices, and more markets for U.S. producers to sell their products.

When we lower barriers to trade, the benefits to Americans — higher incomes, greater services and, overall, a higher standard of living — get better.

But rather than lowering barriers to trade, some want to erect them, citing a rising “trade deficit” or by claiming that trade harms American businesses.

Those fears are unfounded. Trade makes us better off in nearly every way.

In a series of videos for Freedom Partners, economist Dan Mitchell talks about the immense benefits of free trade, why the criticism of trade doesn’t add up and how protectionist policies harm Americans.

Share on Twitter

“Trade deficits don’t matter.”

  • Our trade deficits are largely offset by foreign investments in American businesses.
  • You have a trade deficit with your grocery store, too. You buy from them, but they never buy anything from you. It works out well for both.

Share on Twitter

“Thanks to trade … You can specialize in what you do best or what you like, whether it be manufacturing, waiting tables — anything else!”

  • When people have greater freedom to exchange, their lives and the lives of others improve.
  • Trade brings thousands of dollars in benefits to American families, in addition to higher wages.
  • Unjust trade restrictions hamper these positive outcomes.

Share on Twitter

“Would anyone argue that we’d be better off if the government banned lightbulbs in order to protect candlemakers, or if they banned computers to protect typewriter jobs? Of course not!”

  • The process of “creative destruction” produces life-enhancing innovations.
  • Trade gives us greater access to new, cheaper and higher-quality goods and services.
  • Tariffs hold us back.

Share on Twitter

“The WTO largely serves U.S. interests. We should use it to our advantage, not attack it.”

  • Tariffs levy enormous costs on American consumers, workers and businesses.
  • The best way to lower tariffs worldwide is to negotiate free trade agreements and embrace institutions such as the World Trade Organization.
  • These organizations serve U.S. interests, lowering tariffs and making Americans better off.

It’s Time for Washington to Embrace Free Trade

Trade helps keep America’s economic engine running. It gives is access to a wide range of world-class goods, and puts more money in our paychecks.

That’s why Washington should work to eliminate all tariffs and trade restrictions at home and abroad.

We need a zero-tariff trade environment to keep America strong and prosperous.

America runs on trade.

Learn more about trade and how protectionist trade policies undermine a strong U.S. economy.