Irrelevant Facts
14 February 2008
The Editor, New York Times
229 West 43rd St.
New York, NY 10036
To the Editor:
Every month you report Commerce Department figures on the U.S. trade deficit with individual countries. For example, we learn today that last year "[t]he trade deficit with China continued to rise, jumping by 10.2 percent to $256.3 billion" ("U.S. Trade Deficit Drops in 2007," February 14).
Before again reporting such figures, your reporters (and the Commerce Department) should ask a fundamental question: In this world of extensive multilateral trade and investment, of what conceivable relevance is a measure of the volume of goods and services trade between any two countries? America's "trade deficit" with China is as relevant as is your "trade deficit" with, say, your columnist Maureen Dowd. I'm sure that every year you buy more from her than she buys from you. I'm also sure that you're not bothered by this "deficit" - and for good reason: in a world of multilateral trade, no two entities are likely to have so-called "balanced" trade with each other.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Fairfax, VA 22030<
The Editor, New York Times
229 West 43rd St.
New York, NY 10036
To the Editor:
Every month you report Commerce Department figures on the U.S. trade deficit with individual countries. For example, we learn today that last year "[t]he trade deficit with China continued to rise, jumping by 10.2 percent to $256.3 billion" ("U.S. Trade Deficit Drops in 2007," February 14).
Before again reporting such figures, your reporters (and the Commerce Department) should ask a fundamental question: In this world of extensive multilateral trade and investment, of what conceivable relevance is a measure of the volume of goods and services trade between any two countries? America's "trade deficit" with China is as relevant as is your "trade deficit" with, say, your columnist Maureen Dowd. I'm sure that every year you buy more from her than she buys from you. I'm also sure that you're not bothered by this "deficit" - and for good reason: in a world of multilateral trade, no two entities are likely to have so-called "balanced" trade with each other.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Fairfax, VA 22030<
Posted by Don Boudreaux on
Thursday July 3, 2008 at 10:28am