Henderson on NAFTA and Mercantilism
Those statements are true. But they leave out something just as important: If NAFTA were eliminated, not just U.S. tariffs and restrictions on Canadian exports, but also Canada’s tariffs and restrictions on Canada’s imports would rise. So even if we restrict ourselves to considering the well-being of Canadians, Robertson has left out approximately half the gains from trade–the gains to Canadians from getting U.S. (and Mexican) goods more cheaply. If you don’t understand that consumers gain from more competition, well, you’ve missed a lot.
This is an excerpt from David R. Henderson, “The case for free trade should not rely on mercantilism,” Fraser Institute blog, March 23.
I recommend (obviously) the whole piece, which is not long.