In real estate development, land grabs are a zero-sum game: When you win, it means someone else loses. In the same line of thinking, imports result in trade deficits; trade deficits destroy jobs and, consequently, lower citizens’ standard of living. But what if trade deficits have nothing to do with our economic well-being, which in fact relies on a healthy dose of foreign competition? A generally accepted measure for a country’s standard of living is the GDP per capita — the output of goods and services produced in a year divided by everyone within the country’s borders. It’s a measure of economic growth and well-being used by the White House. By this measure, Harvard psychologist Steven Pinker shows in his book, “Enlightenment Now,” that China, once a famine-stricken nation, had achieved in 2008 the same per-capita income that Sweden had in 1950. And China’s progress has hardly been made at the expense of the United States. The US has grown richer still, during the same long boom in the late 20th century, along with South Korea, Taiwan, and Singapore and other developing nations, including Bangladesh, Ethiopia, Georgia, Rwanda, Vietnam and others. Everyone has been winning big. The world has never been more abundant. Nevertheless, some rightly point out the rising inequality of the United States. Income among the top 1% has steadily crept up, and the cohort now control nearly 20% of all income, reaching levels similar to the “Gilded Age” before World War I. But if the administration is truly worried about the suffering of middle-class Americans, the real answer is to increase social support for re-skilling the labor workforce. Trade and technology, in and of themselves, are merely the precondition for wealth and progress. According to Pinker, in 1800, an
Donald Trump is a real estate developer. He doesn't get the benefits the US gets from trade
Bookmark the permalink.