A Unilaterial Declaration of Free Trade With Everyone

From: R
Sent: Tuesday, March 15, 2016 4:22 PM
To: wblock@loyno.edu
Subject: Free Trade question
Dear Professor Block,

I have listened to you for many years now.  I understand the arguments against tariffs and how tariffs can harm the economy. My question is this; how can we truly have free trade with other nations when our trading partners place high tariffs on our exports?  As you know the Chinese do this very thing in addition to devaluing their currency so as to make their already cheap labor even cheaper on the manufactured goods they export to us.

Is this by definition unbalanced trade with other nations ??  Can unbalanced trade still be free trade? Thanks so much R

Dear R: We can’t have full free trade without their cooperation. But, we can have a unilaterial declaration of free trade with everyone. The U.S. can state that we will not have any tariffs on incoming goods, no matter what our trading partners do in this regard. This was for a long time the policy of Hong Kong. Even so fair weather a friend of free enterprise as Milton Friedman supported this policy.

Best regards,

Walter

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1:37 am on January 22, 2019