Tuesday, April 10, 2012

Exports Ahead

Tyler Cowen's recent American Interest essay argues that surging exports will fuel new American economic growth.  Cowen doesn't, however, really address the fact that the US trade deficit is also growing.  Exports may have risen to record highs, but so have imports.  It's a very interesting piece, whether you agree with it all or not.

At least Cowen, one of the leading figures in the right-libertarian establishment, implicitly admits that we don't really have free trade (emphasis added):
As a major exporter (among other strengths), the United States can be expected to maintain and even extend its investments in its Navy and Air Force. The current defense budget austerity won’t last very long, meaning, among other things, that it won’t be a fun time to be a pirate. Parts of the Pacific may, politically speaking, become a “Chinese lake”, but the two economically dominant countries will favor both open seas for trading and some approximation of global free trade, albeit with remaining protections in China itself.

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