Donald Boudreaux: Answering economic questions
The greatest contribution that economists make to society is to ask questions that are seldom asked by non-economists. The mere asking of probing questions opens the eyes of thoughtful people to aspects of reality that otherwise remain hidden. Here are some such questions:
• Everyone recognizes that each American becomes more prosperous with increases in the amount of goods that $100 enables him or her to buy from merchants in the shopping mall across the street. Why, then, do so many of us — including President Trump — believe that each American becomes less prosperous with increases in the amount of goods that $100 enables him or her to buy from merchants in the country across the ocean?
• Suppose an American invents a machine called an “amaizer” that inexpensively turns corn into cars. When corn is put into this machine today, brand new automobiles roll out of this machine tomorrow. Most of us would enthusiastically applaud the amaizer’s inventor for his or her genius, and for bestowing on society an immense benefit. Why, then, do many of us panic about the operation of a machine called a “cargo ship” that inexpensively performs the same feat as the amaizer ? After all, we Americans put corn into cargo ships today and watch brand new automobiles roll out of them tomorrow. How does a cargo ship’s transformation of corn into cars differ from that of the amaizer?
• Many Americans regard as unfair the need for U.S. auto producers to compete against foreign auto producers who manufacture cars at much lower costs. Do these Americans, then, also regard as unfair the need for U.S. auto producers to compete against Americans who sell used cars? After all, the cost of manufacturing used cars is far less than that of manufacturing new cars. Should Trump encourage more employment in U.S. auto plants by imposing tariffs on purchases of used cars?
• Most American conservatives understand correctly that attempts by the U.S. government to micromanage any sector of the U.S. economy , such as the health-care sector, does great damage not only to that sector but also to the American economy at large. Why, then, do so many American conservatives today live in fear that Beijing’s micromanagement of some sectors of the Chinese economy will cause those sectors to become economic super-performers that leave their American counterparts in the dust? Do they believe that communist-party officials are smarter and less corrupt than are U.S. government officials? Or do they secretly believe that communist central planning is superior to free markets?
• A frequently heard refrain is that a country doesn’t exist unless its government strictly controls immigration. Did America, then, not really exist as a country until 1882, when Uncle Sam first began to restrict immigration into the U.S.? And do U.S. states not really exist given that no state government controls immigration into its borders of people from other states?
• Opponents of more liberalized immigration today often assert that immigrants come to America to free-ride on the U.S. welfare system. Why, then, does the U.S. government prohibit Americans from employing undocumented immigrants? And why does our government impose many restrictions on the employment even of immigrants who are here legally? Surely if immigrants are attracted here mostly to drain our welfare state, we needn’t spend any effort to prevent these free-loaders from getting and holding productive jobs.