Trade Deficits and Tariffs
Senator Rand Paul argues that trade deficits with other nations are an economic fallacy and that the only real trade that matters is the individual transactions between buyers and sellers.
Key Points
- Tariffs are taxes that are ultimately passed on to consumers
- Trade deficits are viewed as artificial accounting rather than a true measure of economic health
- Individual transactions between buyers and sellers are the core of trade
Pros
- Emphasizes the importance of looking at trade deficits from a different perspective
- Highlights the individual transactions as the real essence of trade
Cons
- Does not address potential negative impacts of trade deficits on domestic industries and employment