This week my colleague Ryan Young rightly warned that the White House’s newly announced tariffs on Chinese goods will harm Americans consumers and workers. Simon Lester of the Cato Institute also notes that confusion about the nature of trade deficits is a bipartisan one. This is a good opportunity to get back to basics and remember what tariffs are and how they affect economic behavior and consumer welfare.
In the video above, George Mason University economist Don Boudreaux explains that free trade is nothing more than a system that treats foreign goods the same as domestic goods. He also points out that the United States itself is an excellent example of a wealthy and productive free trade zone. If tariffs made citizens better off, Boudreaux asks, shouldn’t California want to restrict trade with Maine, and Florida protect its residents from imports from Colorado?