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Title : A Watch To Trump World: Peter Navarro Has A Theory Close Harley's As Well As India
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A Watch To Trump World: Peter Navarro Has A Theory Close Harley's As Well As India

Here’s Don Boudreau missive of the alphabet to the Wall Street Journal commenting on analysis past times Trump merchandise advisor Peter Navarro:

The headline is promising: “Peter Navarro Responds to His Trade Critics” (March 22).  So I eagerly anticipated reading Navarro’s noun defense, against knowledgeable critics, of his reasons for fearing merchandise deficits.  Alas, disappointment.  Navarro offers non a unmarried relevant argument.

Typical is his contemptuous handling of Dan Ikenson.  To works life that Mr. Ikenson has an “Alice-in-Wonderland worldview,” Navarro but lists some of Mr. Ikenson’s policy positions without offering every bit much every bit a syllable to inform us why these positions are untenable.

The closest Navarro comes to making a relevant declaration is when he writes, responding to Desmond Lachman, that “if Republic of Republic of India agrees to lower its tariffs on Harley Davidson motorcycles, Indian consumers volition purchase to a greater extent than Harleys in addition to relieve less piece Harley volition sell to a greater extent than Harleys in addition to invest more.”

Well, no i has ever denied that Indians would buy, in addition to Harley would sell, to a greater extent than Harleys if Republic of Republic of India reduces its tariff on these bikes.  But it doesn’t follow that Indians would necessarily, every bit a result, relieve less.  (Does Navarro ever relieve less when his terms of living falls?)  And piece to a greater extent than resources would indeed probable endure invested inward Harley’s operations, these resources would convey to come upwards from foreigners if Americans don’t increase their savings.  Contrary, therefore, to the decision that Navarro wants us to depict from what he pretentiously (if inaccurately) calls “obvious full general equilibrium effects,” a cutting inward India’s tariffs on Harleys is non remotely guaranteed to Pb to a decrease the U.S.A. merchandise deficit.

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha in addition to Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA  22030

The higher upwards originally appeared at Cafe Hayek.

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