Don Boudreaux – Open Letter to Mitt Romney
Your [Romney’s] wish to “label China a currency manipulator” means that you seek a pretext to impose (as your website says) “countervailing duties” on imports from China – which is to say, you seek a pretext for raising taxes on Americans who buy goods and services from China. (emphasis added)
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Donald Boudreaux is one of my favorite economists, not so much because he is a logical thinker, but because he can express himself so eloquently. In his letter to Romney, Boudreaux says that he expects Romney to lie, distort, misstate, obfuscate – after all, it’s politics:
A campaign, after all, is not a seminar for discovering truth. It’s a verbal wrestling match to get votes by whatever means, regardless of how tawdry or devious.
But Romney’s obvious lack of understanding of international economics drove him crazy. Out of one side of his mouth Romney has repeatedly said: “I will not raise taxes on the American people. I will not raise taxes on middle-income Americans.” Of course he won’t. He can’t. If he is elected president, he’ll discover that his rants are verbal tissue paper: only Congress can raise taxes.
But that’s beside the point. The real point is that by threatening to impose duties on Chinese goods as punishment for being a “currency manipulator” Romney wants to raise taxes on those same middle-income Americans.
Boudreaux explains:
If you keep your promise to impose countervailing duties on imports from China you will thereby break your promise to not raise taxes on the American people. (Americans who buy imports from China are, after all, American people.)
But if you keep your promise to not raise taxes on the American people, you must – as I hope you will – break your promise to punitively tax those many Americans who buy imports from China.
But, hey, what would you expect from Romney? He’s running for president and will take “cheap shots” wherever he can, counting on Americans’ ignorance of how things work in the real world to support him. Saints preserve us!
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