More Deficit of Understading
10 November 2006
Editor, The Wall Street Journal
200 Liberty Street
New York, NY 10281
Dear Editor:
Barbara Roper shares the World Economic Forum's opinion that America's trade deficit signals "decline in U.S. economic competitiveness" (Letters, Nov. 10). Even overlooking the inapt allusion to zero-sum sports games conjured by the phrase "economic competitiveness," Ms. Roper and the WEF simply misunderstand the trade deficit.
The U.S. trade deficit rises when foreigners invest more in America. More investment means more factories, more firms, more and better equipment, more R&D, more worker training, more opportunity for creative but cash-strapped entrepreneurs. This investment strengthens our economy. It also reveals that investors worldwide are optimistic about America's economic future.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
G
Editor, The Wall Street Journal
200 Liberty Street
New York, NY 10281
Dear Editor:
Barbara Roper shares the World Economic Forum's opinion that America's trade deficit signals "decline in U.S. economic competitiveness" (Letters, Nov. 10). Even overlooking the inapt allusion to zero-sum sports games conjured by the phrase "economic competitiveness," Ms. Roper and the WEF simply misunderstand the trade deficit.
The U.S. trade deficit rises when foreigners invest more in America. More investment means more factories, more firms, more and better equipment, more R&D, more worker training, more opportunity for creative but cash-strapped entrepreneurs. This investment strengthens our economy. It also reveals that investors worldwide are optimistic about America's economic future.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
G
Posted by Don Boudreaux on
Tuesday June 26, 2007 at 5:12am