Trade is the great bringer of peace. Frederic Bastiat once said that “If goods don’t cross borders, armies will”. Restricting trade is one of the greatest acts of self-harm the state inflicts on its people.
The nature of trade is often misunderstood. Nations don’t trade with other nations. Rather, individuals in some nations trade with individuals in other nations. It may seem trifling, but it makes great deal of difference to who bears the cost of damaging trade policies.
There are many ways in which governments all over the world restrict free trade between their citizens and those of foreign countries. Most obvious is tariff barriers. These are portrayed as forcing foreign suppliers to pay a premium to supply goods locally, which consequently makes the foreign supplier more uncompetitive in the local market, saving local jobs. But this could not be further from the truth. The cost of the tariff … Read the rest