HAPPY BIRTHDAY ADAM SMITH!

2 PARAGRAPHS 4 LIBERTY: 427

“By means of glasses, hotbeds, and hotwalls, very good grapes can be raised in Scotland, and very good wine too can be made of them at about thirty times the expense for which at least equally good can be brought from Foreign countries. Would it be reasonable law to prohibit the importation of all foreign wines, merely to encourage the making of claret and burgundy in Scotland?”

Adam Smith answers his own question by saying that this would be absurd. So what should happen? Adam Smith says that, instead, what people, communities and countries should do is to concentrate upon producing the goods and services that they can do best and most competitively, and then trade those goods and services to others in exchange for purchasing the goods and services that others produce better and less expensively. That way everyone wins!

As a present day example, probably the least self-sufficient country in the world is Singapore, which relies upon imports for its food, energy and even drinking water. But they are expert at many other things, and live on as high a scale of life as anyone in the world. At the opposite end of the spectrum is North Korea, which almost universally relies upon self-sufficiency. Where would you rather live? Of course, in addition to the above is the old adage that “If goods and services don’t cross borders, troops soon will.” In other words, and for many reasons, support Free Trade!

Quote for the week from the comic strip Hagar the Horrible: A tax collector to a homeowner: “Your luxury tax is due.” Response from the homeowner: “We don’t live in luxury!” Tax collector: “But the King does.”