You write that “exports are at least as much a benefit to us as our imports are.”
With respect, you’re mistaken. To see why, look at the matter at the level of your household. What you export from your household is your labor; what you import are the goods and services that you purchase with your income. Suppose that you were given the option of continuing to do one or the other of these activities but not both. That is suppose that you could either (a) continue to export (that is, continue to work) but no longer import (that is, no longer bring into your household any goods and services) or (b) continue to import into your household goods and services for your consumption but no longer work. Which option – (a) or (b) – would you choose?
You would clearly choose option (b).* The reason is that you supply the fruits of your labor to others in order to increase your ability to consume. What you export from your household is a cost that you willingly incur in order to be able to import into your household the goods and services that you and your family consume. What is true at the level of the household is here true at the level of the national economy: the goods and services that Americans export to foreigners are the costs that we willingly incur in order to be able to import into our country the goods and services that we receive from foreigners in exchange. Exports are the means; imports are the end.
* If I’m mistaken and you’d choose option (a), please call me as I have several household repairs to be done and I’d be delighted to have you do the repairs for me for free.
Don Boudreaux, “Exports are Costs; Imports are Benefits”, Café Hayek, 2017-10-17.
November 8, 2019
QotD: Exports are costs; imports are benefits
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I must respectfully disagree. The case where all of our needs are taken care of is a definition of childhood dependency. It may be pleasant for the individual, but it is not good for any healthy adult. Improvement using handouts is currently the modus operandi for socialist governments from Venezuela to Chicago- look how well that is working.
Economists generally measure the health of an economy by calculating GDP, which is supposed to be the total production of the country. Although the numbers in the calculation are derived from consumer data, they are converted to production numbers by adding net trade, which is exports minus imports. Exports increase GDP, since they are produced locally, while imports reduce it since they are pure consumption. A strong economy should not be measured by how low prices are at Walmart, but by how many people are gainfully employed.
I have no idea why government spending is somehow considered an addition to economic health.
Comment by Craig Hamilton — November 8, 2019 @ 13:32