Imports don't exist

Many populists criticize the trade deficit with other countries. Part of this is certainly xenophobia. Because if we merged the other country into ours, the so-called deficit would disappear.

Who cares if New York runs a trade deficit with Pennsylvania? As Adam Smith wrote, "Nothing . . . can be more absurd than this whole doctrine of the balance of trade."

Sheldon Richman expands on these ideas in The Freeman magazine, writing, "In reality, then, there are no imports and exports. There is only what I make and what everyone else makes. ... Few people would want to live just on what they themselves could make."

Once we choose trade over self-sufficiency, we're just arguing about how big the free-trade zone should be. Since trade is always mutually beneficial, the answer is: The bigger the free-trade zone the better.