Market Correction

21 December 2006

Editor, The Wall Street Journal
200 Liberty Street
New York, NY 10281

Dear Editor:

David Malpass rightly argues that the U.S. trade deficit is a sign, not of American economic weakness, but of vigor ("Embrace the Deficit," December 21). To further strengthen his case he might have pointed out that in 102 of the 120 months of that most economically depressed decade, the 1930s, the U.S. ran trade surpluses. On an annual basis, America had a trade surplus for nine of the ten years of the 1930s (with 1936 being the only year of a trade deficit). For the whole of that decade, the U.S. ran a significant trade surplus. Exports over those dreary ten years totaled $26.05 billion while imports totaled only $21.13 billion.

Clearly, just as a trade deficit is no sign of economic malaise, a trade surplus is no sign of economic vitality.

Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University

20 December 2006

Editor, The Washington Post
1150 15th St., NW
Washington, DC 20071

Dear Editor:

Concerned about America's current-account deficit, Robert Samuelson says that "America has gorged on imports" ("The Economy's Rebalancing Act," Dec. 20). To "gorge" implies gluttony or irresponsible consumption. In fact, however, at least half of America's imports are intermediate components, raw materials, and capital goods. These imports do not gratify immediate consumer cravings but, instead, enhance American firms' productivity.

Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University

19 December 2006

The Editor, New York Times
229 West 43rd St.
New York, NY 10036

To the Editor:

Jerry Albert says that "Franklin D. Roosevelt raised America from its Depression-era depths" (Letters, Dec. 19). That's the familiar myth. The reality - as economic historian Robert Higgs shows in his recent book Depression, War, and Cold War* - is that New Deal policies and the misguided fantasies that motivated them kept the economy mired in a deep depression for at least all of FDR's first two terms in office. And because statistics from a command-and-control war-time economy reveal nothing about how well an economy truly is functioning, Higgs makes a strong case that the Great Depression likely didn't end until 1946.

Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University

* (Oxford University Press, 2006)

18 December 2006

Editor, Faithful America

Dear Editor:

Regarding your petition demanding that Congress raise the minimum-wage: You claim to be "morally outraged by the number of people living in poverty in the United States, and believe that now is the time to give hard-working low-wage workers a raise."

How convenient for you to be morally outraged that other people don't spend their money as you feel they should. If you are truly morally outraged, you would not demand that Congress force others to pay higher wages, especially given that so much evidence shows that minimum-wage legislation harms many poor workers. Instead, you and those who sign your petition would give directly to poor people your own resources. THAT would be commendable action - unlike your uninformed and personally inconsequential pontificating about the "need" for a higher minimum-wage.

Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University

18 December 2006

Editor, The Boston Globe

Dear Editor:

A private company, SpotScout, offers an innovative way for drivers to use cell-phones to purchase from each other temporary access to public parking spaces ("What price parking?" December 18). But you're skeptical, arguing that "if the system worked as intended, SpotScout users would have an inside track on publicly-owned parking spaces."

What's the problem? The current system is much like musical chairs, and just as (un)fair. Public parking spaces now go to drivers lucky enough to be just behind spaces about to be vacated. Is this system more fair or less annoying than one in which drivers voluntarily exchange information with each other about which spaces will become available when and where?

And another thing: on what basis does Boston's Transportation Commissioner claim the authority to tell cell-phone users what sorts of information they can exchange?

Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University

17 December 2006

Editor, The Baltimore Sun

Dear Editor:

Today's letter from the American Lung Association's Stephen Peregoy reveals the contempt that members of the command-and-control crowd have for ordinary people. Justifying his opposition to letting "each bar and restaurant owner . . . decide whether to allow smoking," Mr. Peregoy rhetorically asks "Should each restaurant owner decide whether or not to refrigerate dairy products? Or whether rodents should be allowed to roam the kitchen?"

Here's someone who imagines that we ordinary people are too inept on our own to avoid filthy restaurants serving rotten food. Here's someone who supposes that the great bulk of us normal folks are ignoramuses who must be grabbed by our noses and led to salvation by the enlightened few represented by the likes of Mr. Peregoy.

Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University