Market Correction

But Lou Dobbs Believes It!
And it's fair to ask: What's more valuable? A dollar's worth of scrap metal or a dollar's worth of shiny new consumer electronics?

9 January 2008

Editor, The New Yorker

Dear Editor:

John Seabrook correctly reports that the Chinese buys lots of scrap metal from Americans ("American Scrap," January 14). But he incorrectly asserts that "In this sense, China's industrial might is literally being constructed out of the ruins of our own."

As the Cato Institute's Dan Ikenson found, U.S. manufacturing is hardly in "ruins." In America, manufacturing output and inflation-adjusted exports and profits reached all-time highs in 2006. (Data for 2007 are still incomplete.) And despite having only one-fourth the population of China, America's industrial output in 2006 - the largest of any country in the world - was 2.5 times greater than China's.*

Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Fairfax, VA 22030

* http://freetrade.org/pubs/pas/tpa-035es.html
Posted by Don Boudreaux on Sunday June 8, 2008 at 9:03am

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