Tag: freetrade

The third Voxiversity video is now live! This is another short video, and one that conclusively disproves the oft-heard assertion that trade wars are always bad for the economy.

Episode Three: Trade War: What is it good for?

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In which I demonstrate why Ben Shapiro has been running non-stop from a debate with me, particularly one concerning economics. First, this is a link to his piece entitled “Yes, Tariffs Are Still Stupid. Here’s Why”. Go and read it first, in its totality, so you will understand that I am not making any of this up and I am fairly representing his positions that I am criticizing.

Yes, free trade is good.

On Thursday, The Journal of American Greatness, an outlet devoted to President Trump’s purported philosophy, printed an article by Spencer Morrison, a law student and editor-in-chief of the National Economics Editorial. The article is an attempt to rebut the chief conceits of free trade, and in particular, knock down my objections to President Trump’s fondness for tariffs. It’s titled “Why Ben Shapiro is Wrong on Free Trade.”

The reality is that my arguments on free trade have been supported by every major free market economist in history, but I do appreciate the central billing.

This is a little sleight of hand, as Benny presents a tautology as if it means something. Friedrich List is a major non-socialist economist who strongly favored tariffs, but is he a “free market economist”? What does “free market economist”, a phrase that is meaningless in economics terms, mean?  It means an economist who supports free trade. So, the reality is that Benny is cribbing “his” arguments from economists who support free trade. Which is not news.

Morrison’s argument in favor of tariffs begins with an analysis of a three-minute segment of video from my daily podcast in which I talk about the flaws in tariff-based economics. As I’ve actually done full episodes on tariffs, and written extensively about them, I wouldn’t say that the video is my fulsome argument against them, but it’s sufficient for purposes of discussion. Morrison first misrepresents my argument in the video: he says that I’m pro-trade deficit, when in reality, I merely explain in the video that trade deficits are an irrelevant economic statistic (neither good per se nor bad per se) and that some countries that run trade deficits do just fine, while some that run trade surpluses don’t. Morrison takes that to be me stumping for the beauty of trade deficits — which, again, I don’t do, since I think that statistic is irrelevant. 

It’s fair for him to criticize Morrison’s misrepresentation, since Benny is not pro-free trade deficit, he merely thinks they are irrelevant. But Benny is totally wrong, since a trade deficit is not even remotely irrelevant, as it literally shrinks the economy. To grow the economy and increase GDP, export. To shrink the economy and reduce GDP, import. What this reveals is that Benny clearly does not know how GDP is calculated, nor is he aware of how the trade deficit is a part of the basic GDP formula: C+I+G+(x-m).

As it happens, I address this in the next Voxiversity video, but those of you who understand addition and subtraction should be able to grasp that when (x-m) is negative, there is a trade deficit and GDP is lower. Without the trade deficit, the USA would have a $20.3 trillion economy rather than a $19.7 trillion economy, so it’s hardly “irrelevant” considering that 3 percent growth is cause for celebration these days.

Finally, Morrison gets to his central argument: comparative advantage doesn’t work when capital is mobile. Here’s Morrison:

Comparative advantage is an elegant theory, but it too is domain-specific—it only works when certain preconditions are met. For example, capital must be immobile for the theory to apply. Shapiro ignores this crucial limiting factor, and applies comparative advantage to just about everything. This is his root error. … For example, comparative advantage suggests that the key to getting rich is to specialize production, regardless of what you produce. That is, a country with a comparative advantage in growing soybeans should focus on growing more soybeans, while a country with a comparative advantage in manufacturing semiconductors should focus on manufacturing more semiconductors. In either case, this supposes, their relative wealth will correlate with the degree of specialization, as opposed to the complexity of their production. This is objectively wrong.

To support the contention that it is objectively wrong to embrace comparative advantage, Morrison cites two studies. First, he cites a paper from economists Ricardo Hausmann, Jason Hwang, and Dani Rodrik, claiming that countries that manufacture automobiles develop faster than those that grow bananas, and another from Stephen Redding of the London School of Economics stating that economic growth is path-dependent — that if you develop a particular industry that is more sophisticated, other industries grow up around that industry, making for a more powerful economy. The result, Morrison claims, is that the United States should enforce tariffs on behalf of its most technologically advanced/important industries, to prevent other countries from undercutting those industries and reducing us to comparative advantage in nail-clipper manufacturing.

First, literally every economist knows that comparative advantage doesn’t work when capital is mobile. The immobility of capital is only one of David Ricardo’s false assumptions that are required for comparative advantage to logically hold up. Shapiro doesn’t understand that the papers Morrison is citing are not relevant to the capital argument, or that Morrison is simply trying to keep it simple for economics illiterates like him. The immobility of capital is merely the fifth of the seven false Ricardian assumptions intrinsic to the theory of comparative advantage listed by Ian Fletcher, which are as follows:

1.     The comparative advantage is sustainable.
2.     No externalities.
3.     Production factors move between industries without cost
4.     No change in the ratio of income inequality.
5.     Immobile international capital
6.     Short-term efficiency causes long-term growth
7.     Foreign productivity does not improve

There are several points to be made here. The first is the most important: the argument Morrison makes is for total state control of the economy. If we can simply pick the best industries and subsidize them, we should obviously do that. Why not just embrace mercantilism?

That is a blatant and shameless misrepresentation of Morrison’s argument. His argument for tariffs is clearly not an argument for “total state control of the economy”. Shapiro is simply being dishonest there.

First, of course countries that develop higher-profit sectors will have higher growth rates than those that rely on low-profit sectors. And of course the decisions you make now have impact on the future development of industry. But this has nothing to do with tariffs. The Hausmann, Hwang, and Rodrick paper doesn’t mention tariffs once. Neither does the London School of Economics paper.

Again, there’s a reason for that. There are two problems with tariffs: first, you cannot tell which sectors will be the most profitable, because you cannot tell the future, which means that government is far more likely to “lock-in” particular pathways than to spur future growth; second, most market “lock-in” is self-correcting — we develop new products on a routine basis that are different in kind than the products that preceded them. Horses and buggies dominated the market, and we built roads in a certain way to accommodate them, and we built houses near those roads. Then cars came along and blew all of that out of the water.

If we could see the future, we could have simply picked which industry upon which to focus. We couldn’t. And in 1947, the smart money would have been in using government to tax all other industries to dump money into manufacturing, for example. That would have been totally wrong. In 1947, according to the Bureau of Economic Analysis, manufacturing represented 25.4{8f3a20e95123fc761e5b6545cdcf28fe932999778b1965cb4dd78a3d9b063320} of GDP production in the United States; finance represented 10.3{8f3a20e95123fc761e5b6545cdcf28fe932999778b1965cb4dd78a3d9b063320}; agriculture 8{8f3a20e95123fc761e5b6545cdcf28fe932999778b1965cb4dd78a3d9b063320}. If we had been creating tariffs to protect the “most important” industries, we’d have put our money on manufacturing, finance, and agriculture. But we’d have been wrong. By 2016, manufacturing represented 11.7{8f3a20e95123fc761e5b6545cdcf28fe932999778b1965cb4dd78a3d9b063320} of GDP; finance represented 20.9{8f3a20e95123fc761e5b6545cdcf28fe932999778b1965cb4dd78a3d9b063320}; agriculture represented 1.0{8f3a20e95123fc761e5b6545cdcf28fe932999778b1965cb4dd78a3d9b063320}.

The papers may not mention tariffs, but tariffs are the primary way those sectors are defended, when imports in those sectors are not simply banned altogether. I hope Shapiro is being dishonest there too, because his claim that tariffs have nothing to do with how countries develop industries is simply wrong.

And more often than not, you can tell which sectors are going to be more profitable than others. The fact that you cannot predict these things with absolute 100 percent accuracy does not mean that you cannot do so at all, or to a worthwhile extent. Despite some famous blunders, MITI did so very successfully in Japan from 1949 to 2001. Germany still does so today, to such an extent that exports make up 46.1 percent of its economy. Ben completely fails to understand both the way tariffs work as well as the fact that he is begging the question; if we’d put our money on protecting the manufacturing sector, then that sector almost certainly would not have fallen from 25.4{8f3a20e95123fc761e5b6545cdcf28fe932999778b1965cb4dd78a3d9b063320} to 11.7{8f3a20e95123fc761e5b6545cdcf28fe932999778b1965cb4dd78a3d9b063320} of GDP. Preventing such declines is the primary point of using tariffs to defend a particular sector!

And this is the point. Impoverishing your profit sectors through tariffs in order to dump money into non-competitive industries impoverishes your country as a whole. Economic flexibility requires that the government not impede the free flow of capital within industries. That’s true when capital is mobile as well — if we invest our money in Chinese tech because it’s cheaper and better (even if they’re subsidizing that industry!), that money comes back to the United States in the form of capital account surplus.

First, it’s both statistically and historically false to claim that tariffs impoverish countries. Second, money does not necessarily come back to the United States, as the existence of foreign-held eurodollars, the $3.1 trillion held overseas by US corporations since 1986, and the recent decision of Apple and other tech companies to repatriate over $400 billion being will suffice to demonstrate. And third, Ben clearly has not thought through the intrinsic costs of economic flexibility, which when taken to their free trade extreme are absolutely and inevitably lethal to any nation.

I could go into considerably more detail, but at this point, it should be obvious to the informed reader that Ben is doing little more than spouting off free trade rhetoric that he has learned by rote; he does not understand the theory of comparative advantage, its justifications, its assumptions, its flaws, or its inescapable consequences. With regards to free trade and economics, Benny is an ignorant and uninformed fraud, and his position on free trade is completely and utterly incorrect. Tariffs are not stupid, but Ben Shapiro certainly is.

From the last part of my appearance yesterday on Dialogue.

US TARIFFS A PRELUDE TO A TRADE WAR
President Trump seeks to renegotiate NAFTA

YANG: President Trump accused his predecessors of making stupid mistakes, as a result Americans have suffered $800 billion of trade deficits almost annually. So what do you think of his negotiation ploy to use the issue of a trade imbalance for renegotiating NAFTA with Canada and Mexico? The Minister of International Trade in Canada and politicians in Mexico both made it very clear that they would not allow the U.S. government to hurt their respective economies. What do you think of this war of attrition?

VOX: I think the Trump administration’s long term goal is to get rid of NAFTA altogether. NAFTA is extremely unpopular in the United States, the negative effects of it have actually been worse than its enemies predicted, and none of the benefits that were promised to Americans have been delivered to them. And so, I think that the threats and the posturing of the Mexican and Canadian governments is almost completely irrelevant. Trump has made it very clear that he understands. His focus is on the American working class and finding jobs, finding manufacturing jobs.

That’s why the services perspective that you mentioned with regards to China is really just a tactical measure. It wouldn’t solve… it may solve the issue from the economists’ point of view, but it doesn’t solve it from President Trump’s point of view or from the point of view of the American people. And so I agree with the gentleman who said that’s not a long-term solution. It’s not, because it doesn’t meet the goals that have been expressed by the President.

YANG: We’ll see what happens next. I thank you so much for being with us.

It appears to have been received rather well, so there is a reasonable chance that I will do this again. It’s rather fascinating to observe, as one reader noted, that the Chinese state-owned media is demonstrably more free and open to genuine discussion of the relevant issues than the US media that is owned by no one in particular and certainly isn’t owned by anyone who should be criticized or even identified.

As I mentioned yesterday, I was asked to pinch-hit for Steve Keen on a Chinese English-language business show this morning. They arranged for a trip up to the studio, which frankly struck me as more than a little overkill considering that they only asked me four questions. But it was a real learning experience, although unfortunately I was on a bit of an audio delay. Please keep in mind that I had no idea what the host was going to ask me, except that it would have something to do with China and President Trump’s recent comments about tariffs, because I wasn’t tuned in until about 10 seconds before the host addressed me.

The transcript follows. The sections in italics are the graphics that the producers popped up while we were talking.

YANG RUI: Let me cross over to Mr Vox Day, author of On the Question of Free Trade: An Economic Discourse, for his comments on the latest. What do you make of the impact on the European Union.

VOX DAY: Well, I think the threats from the European Union are essentially toothless. There is very, very little that the European Union can do when it comes to US trade policy. I think it’s a lot of political threat, but ultimately there is nothing they can do about it.

YANG: You mean there won’t be any reprisals from the European Union? Let’s look at such statistics. The exports as a percentage of each economy: Germany is 46 percent, South Korea 42 percent, Mexico 38 percent, and Canada 31 percent. China is just 20 percent, but we are still very much exposed compared to 12 percent (for the USA). So, all would suffer in a trade war if there would be a trade war. What do you think of the collective repercussions.

VOX: First of all, I think it’s important to understand that not everyone will suffer equally in a trade war, and some parties will benefit from it. For example, if you simply look at the United States alone and we take it to the most extreme, absurd example and suppose that the United States were to stop all imports and exports, that would immediately translate into a 3 percent annual boost to the US economy. If you look at how the GDP is calculated, it’s very simple. And so the fact that it might have a negative outcome on Europe, the fact that it would have a strong negative impact on South Korea, says nothing about what the impact on the United States is. And, of course, President Trump has made it very clear that with his America First policy, he is not as concerned about the economic state of the rest of the world.

US TARIFFS A PRELUDE TO A TRADE WAR
US has high domestic demand

YANG RUI: Vox, what do you think of the Chinese response? What would be the most likely response from China, which was accused by the US government of only paying lip service instead of turning to actions, to reciprocate in terms of deals that are not quite in favor of the US. According to President Donald Trump, the US suffers $800 billion of trade deficit, that’s quite a lot.

US TARIFFS A PRELUDE TO A TRADE WAR
How will China respond in a trade war?

VOX: I think China’s response is going to be very calm and measured. I don’t think there is any advantage to China in trying to engage in reprisals, simply because, you know, by definition, the reduction of imports into the US is going to boost their manufacturing and boost their GDP. And so the best thing for China to do is to simply play a long game, play a waiting game. It’s something they’re very good at. This main steel and aluminum tariff is not directed primarily at China and so there is no reason for China to overreact. Trump will do what he says he’s going to do; he’s pretty good about that.

YANG: But last year we enjoyed a trade surplus of $300 billion with the United States and John, the guest speaker here in the studio, says that China is likely to open up our capital market and to lay the groundwork for more American services to be provided here in the Chinese market. What do you think of the prospects?

US TARIFFS A PRELUDE TO A TRADE WAR
US “has an $800 billion yearly trade deficit”

VOX: I don’t think that is going to be effective because Trump is not that concerned about Wall Street. He’s not that concerned about what you call the services market. He’s much more concerned about the industrial base, he’s much more concerned about the working class who have lost so many jobs over the last few decades. I think the most important aspect of that development you’re talking about is that it indicates that China is not disposed to respond to Trump’s harsh rhetoric with harsh rhetoric or ill-considered actions of their own.

I’ll share some of my thoughts on the experience later. And somewhat to my surprise, I was informed that they liked my answers and would like to have me back again sometime.

This is a good sign of the God-Emperor’s America First economic agenda in action. And the Main Street of America at that.

White House chief economic advisor Gary Cohn has resigned from President Donald Trump’s administration.

The former Goldman Sachs president and free trade advocate Cohn, whose departure date will come in a few weeks, decided to quit after Trump announced he would impose stiff tariffs on steel and aluminum imports…. Cohn clashed with Trump’s protectionist advisors on the issue of tariffs. At a meeting with steel and aluminum executives last Thursday where Trump announced the move, Cohn argued against it, warning about price increases for steel and aluminum products, according to a person in the room.

Free trade is not good for the US economy or the American public. But it is good for the financial elite that lives as a useless parasite off both as it plays the “heads I win, tails you bail me out” casino. And for those who missed my debate with economist Bob Murphy, the best thing about tariffs is the fact that they are an alternative to income taxes, a benefit that Bob even conceded during the debate.

VOX: My fourth argument against free trade is practical. Bob wrote that “the most obvious way to realize that tariffs make a country poorer is to realize that tariffs are taxes on domestic citizens, not on foreign producers”. That’s correct but that would only be true if the alternative was no taxes. That is obviously not the case now, it will never be the case, and it should be readily apparent that a nation with a government funded by tariffs will be wealthier and freer than a government funded by income taxes. Tariffs are considerably less intrusive and less economically disruptive than the personal and corporate income taxes that have replaced them. Free trade is unlikely to make a country wealthier if it replaces its tariffs with income taxes. (So to answer Bob’s question of how do politicians make a country wealthier, they do so by substituting tariffs for income taxes.)

BOB: One last thing here. Let’s see. He admitted, and I think it was very telling, that Vox admitted that tariffs are taxes on US citizens. So I wasn’t sure if he was going to go with me on that. He does. So again, Vox is now admitting that yes, the US government imposing taxes on US citizens make us better off and in some sense wealthier and he is just saying in comparison to income taxes. Well, fair enough, I do concede that. By the same token, Obamacare can make America richer if the alternative is socialized medicine. But, clearly, if we were debating if Obamacare makes us better off or not, I shouldn’t have to be forced to use the default option or the baseline case of an even bigger government policy. So, by the same token here, when I say tariffs don’t make Americans wealthier I am not saying the only other alternative is to say the income tax. So I do agree if we want to have some shared issues in the debate here, I do agree that tariffs are better than an income tax, dollar for dollar, but I still don’t think it is correct to therefore conclude tariffs make us wealthier.

It’s fine to hypothesize about a world with no taxes, no debt, and no government spending, but back here in the real world, we have a choice between a) income taxes, b) government debt, and c) tariffs. And tariffs are by far the economically preferable option that does the least harm to the citizenry.

It’s not hard to know who doesn’t have a real case when you see free traders going full-retard over two tariffs.

Trump needs to be impeached immediately to head off the trade war he has declared. His appointees who support that trade war, namely Commerce Secretary Ross and Trade Representative Lighthizer, should be fired immediately.

I am not trying to punish him, I am trying to stop the trade war. He has turned himself into a colossal mistake made by American voters in 2016. I don’t care whether he goes to the Leavenworth Penitentiary or Mar-a-Lago. I voted for Gary Johnson.

Let me give you a list of pertinent facts that cannot be denied:

• U.S. GDP has never been as high as now
• The number of U.S. jobs has never been higher than now
• Trumps claims he wants to increase the number of jobs. For whom? There are no U.S. residents left to hire. The Fed chair said we are at full employment and maybe have more people employed than full employment (you need a certain amount of unemployed because people quit, get fired, go to college or grad school, take vacations between jobs, etc.)
• The Smoot-Hawley Tariff bill (Smoot and Hawley were Republicans) was a large campaign issue in the 1928 presidential race. Republican Hoover said he would sign it. He won and took office in March 1929. He did sign it.
• The stock market crashed repeatedly starting on Black Tuesday October 29, 1929. “…by 1932 stocks were worth only about 20 percent of their value in the summer of 1929.”
(http://www.history.com/topics/1929-stock-market-crash) A similar thing happened to real estate, although there were few statistics on real estate back then. They used a study of real estate prices in the New York Times during the Depression to retroactively create the stats.
• Before the 1929 crash, the stock market was booming with shoe-shine-boy/taxi-driver speculative mania fueled by high-loan-to-value-ratio margin loans. There are lower loan-to-value-ratio margin loans now. But they contributed to the recent drop in stocks forcing some to sell to meet margin calls.
• In 1932, when FDR was elected, the U.S. national debt-to-GDP ratio was 17{a298dadb698b5d9f7b1e1aa14f0e41ed4811cd67f55ba9a1b19c355a24d2c8ed}. Today it is 105{a298dadb698b5d9f7b1e1aa14f0e41ed4811cd67f55ba9a1b19c355a24d2c8ed} meaning the U.S, government is in no position to provide the sort of government financial help it did during the New Deal.
• In 1929, international trade was 7{a298dadb698b5d9f7b1e1aa14f0e41ed4811cd67f55ba9a1b19c355a24d2c8ed} of world GDP. Today, it is 25{a298dadb698b5d9f7b1e1aa14f0e41ed4811cd67f55ba9a1b19c355a24d2c8ed}. Furthermore, about 40{a298dadb698b5d9f7b1e1aa14f0e41ed4811cd67f55ba9a1b19c355a24d2c8ed} to 60{a298dadb698b5d9f7b1e1aa14f0e41ed4811cd67f55ba9a1b19c355a24d2c8ed} of all imports coming to the U.S. now were, in turn, imported into the exporting country to make the product in question—including raw material and manufactured components from the U.S.
• “Buying American” today is near impossible. Virtually all manufactured products are a sort of international all-star team as depicted in the essay “I, pencil.” 

Let’s address those arguments in order.

1. US debt has never been higher. US population has never been higher. That’s why US GDP is at record highs, not semi-free trade.
2. There have never been more Americans out of the work force. The record employment is an artifact of the record population. The employment/population ratio is not anywhere near its record highs and is nearly as low as it was prior to the second wave of women entering the work force.
3. There are currently 94.6 million Americans not in the workforce. The fact that they are not looking for jobs offered at lower average wages than 1973 does not mean that they are entirely uninterested in ever working at any wage.
4. Smoot-Hawley had nothing to do with the Great Depression. First, the annual decline in exports from 1929 to 1933 was less than the decline from 1920 to 1922. Second, the net effect of the change in the balance of trade amounted to less than 0.3 percent of GDP.
5. None of this garblefarbling about the stock market is relevant.
6. The government will be in a much better position to help manufacturers when it has $500 billion in tariff income at its disposal.
7. This is an argument for why less semi-free trade, not more, is needed.
8. Buying American is not “near impossible” and it will get considerably easier and more cost-effective when imported goods are taxed.

Pat Buchanan figured all this out long before I did. And he’s been remarkably consistent all along in his correct argument that free trade is economically destructive for the United States. He was right about this in 1992 and he is right about this today.

The hysteria that greeted Trump’s idea of a 25 percent tariff on steel and 10 percent tariff on aluminum suggest that restoring this nation’s economic independence is going to be a rocky road.

In 2017, the U.S. ran a trade deficit in goods of almost $800 billion, $375 billion of that with China, a trade surplus that easily covered Xi Jinping’s entire defense budget.

If we are to turn our $800 billion trade deficit in goods into an $800 billion surplus, and stop the looting of America’s industrial base and the gutting of our cities and towns, sacrifices will have to be made.

But if we are not up to it, we will lose our independence, as the countries of the EU have lost theirs.

Specifically, we need to shift taxes off goods produced in the USA, and impose taxes on goods imported into the USA.

As we import nearly $2.5 trillion in goods, a tariff on imported goods, rising gradually to 20 percent, would initially produce $500 billion in revenue.

All that tariff revenue could be used to eliminate and replace all taxes on production inside the USA.

As the price of foreign goods rose, U.S. products would replace foreign-made products. There’s nothing in the world that we cannot produce here. And if it can be made in America, it should be made in America.

Consider. Assume a Lexus cost $50,000 in the U.S., and a 20 percent tariff were imposed, raising the price to $60,000.

What would the Japanese producers of Lexus do?

They could accept the loss in sales in the world’s greatest market, the USA. They could cut their prices to hold their U.S. market share. Or they could shift production to the United States, building their cars here and keeping their market.

I have already proved that free trade is totally incompatible with nationalism, national sovereignty, and the future survival of the nation due to the labor mobility required by it. Now I will prove that even complete autarky would, in the present circumstances, be of material benefit to the United States economy.

First, what passes for the macroeconomic facts, courtesy of the BEA:

• Q4 2017 GDP was $19,386.2 billion.
• Net exports were $2,420.7 billion
• Net imports were $3,020.8 billion

Now, let us accept the free trade advocates’ standard argumentum ad absurdum and suppose that Donald Trump actually does shut down all international trade going forward. Let us suppose that China, Japan, and the EU all retaliate with 100-percent tariffs and refuse to sell into the world’s most profitable consumer market. What does this mean in statistical terms?

It means the US economy loses $2.4 trillion in exports and gains $3.0 trillion in imports. Remember, GDP is calculated by the following formula: C+I+G+(x-m). So, this much-feared trade war, at its theoretical worst, would result in the instantaneous growth of the US economy from $19,386.2 billion to $19,986.3 billion GDP.

That is three percent annual growth, which is faster economic growth than the USA has enjoyed since the 1990s. In other words, the very worst scenario that the free traders can envision actually guarantees a bigger and better economy growing faster than the USA has seen for more than 20 years. And given the fact that US manufacturing prices are more expensive, the actual GDP growth will probably be in excess of that.

And just to be fair to the less intelligent, a word of warning to free traders before they resort to the obvious and anticipated rebuttals. Be very, very careful on what basis you attempt to pull your “yeah, but” arguments out of a hat. Remember, any assumption you negate here will also be negated in your own pro-free trade arguments. To put it plainly, I am hoisting you on your own macroeconomic petards.

In answer to the specific question, the Trump tariffs are a very small, but positive first step towards Americans regaining their economic independence from their globalist financial rapists.

Free traders always talk a big game. They love to name drop Ricardo and pretend that the false syllogisms of an 18th century con artist still has relevance to economics today, but their arguments are nothing more than outdated theory that will not stand up to two centuries of evidence-based criticism anymore and they know it. Consider the following email exchange with a reader.

I was discussing free trade with a Macroeconomics Professor at George Mason University named Garett Jones. I brought up your debate with Dr. Miller and he didn’t have kind words for your work. I brought up Steve Keen and he didn’t have kind words for him either. I @ Steve Keen a request to debate this guy and I said maybe you would be willing to host it. Prof Keen said he would be willing to do that. I am sure you have Steve Keen’s email. This would be a great debate because George Mason University is one of the better libertarian economic departments in the country. We’ll see.

Sure, we can do a 500-seat Brainstorm. Let me know, I’ll host and see if the guy will show.

the professor backed out after talking you know what on twitter. He said he has too many deadlines. He spends hours on twitter so that’s a nonsense excuse. I told him it would probably only be around an hour but if he doesn’t want to back up his rhetoric then that’s fine. You and Steve would destroy this guy so it’s no wonder he didn’t want to debate. Free traders only want to show up on corporate media to shill. 

This is my surprised face….

Sounds rather like the professor spent a few hours poking around here and Steve Keen’s site and belatedly realized that he was volunteering for the sort of treatment one normally only experiences in prison washrooms when the guards aren’t around.

The truth is that the free traders have NO DEFENSE WHATSOEVER against my labor mobility argument. The best they can do is offer up a lame “nations don’t matter” protest that renders their precious free trade abhorrent to 99.9 percent of the population.