The world is in chaos, so politicians MUST do something. Hence, they demand autarky, which is like attempting to put out a fire by pouring gasoline on it.
Trade war means increasing the debt, eroding the public confidence, raising prices, and burdening the economy with interventions. All of it done in the name of the "public good."
This week's avocado ban—and the behind-the-scenes regulatory regime governing avocado imports—reminds us that there is no such thing as free trade between the US and Mexico.
Conservatism is allegedly grounded in a recognition of the natural limits of humanity. But when it comes to free trade, conservatives throw all that out the window.
Tariffs and trade controls are little more than tax increases and a chance to further empower a bloated bureaucracy. Not surprisingly, Biden doesn't appear to be enthusiastic about embracing free trade.
The 2021 Nobel Prize in Economics has been awarded to Berkeley's David Card, MIT's Josh Angrist, and Stanford's Guido Imbens for their work on "natural experiments," a currently fashionable approach to estimating the causal impact of one economic variable on another.
Most people understand that it's a good thing when others invest money and capital in your community. But when Canadian investors offered to pour money into France as part of a deal to buy a French company, the regime said no thanks.
The impossibility theorem, developed by Nobel-winning economist Robert Mundell, paints a false tradeoff between the free movement of capital, fixed exchange rates, and effective monetary policy. Under a gold standard, all three are a possibility.
In a normal world, American spending would have sharply declined during the past year. But a flood of newly printed money has juiced spending and imports.
