Here is a great video of the late Milton Friedman debunking protectionism which the US steel industry had wanted to impose against the Japanese in the 70s. (Hat tip Professor Mark Perry)
The premises are fundamentally the same today except that the economic actor at the receiving end of protectionism involves China instead of the Japan.
Some notes:
Import dollars eventually find their way back.
There are invisible and visible effects from policies (ala Bastiat). What makes the protectionist advocacy attractive to the public is the visibility of the effects (loss of jobs of steelworkers), while ignoring the invisible benefits (expansion of jobs in the other industries and importantly lower consumer prices).
As for Japanese mercantilism or a policy of unilateral free trade: “Why should we object to the Japanese giving us foreign aid?”
The premises are fundamentally the same today except that the economic actor at the receiving end of protectionism involves China instead of the Japan.
Some notes:
Import dollars eventually find their way back.
There are invisible and visible effects from policies (ala Bastiat). What makes the protectionist advocacy attractive to the public is the visibility of the effects (loss of jobs of steelworkers), while ignoring the invisible benefits (expansion of jobs in the other industries and importantly lower consumer prices).
As for Japanese mercantilism or a policy of unilateral free trade: “Why should we object to the Japanese giving us foreign aid?”
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