That Which is Not Seen

Being an economist is a very hard job.
One of the hardest parts of the job
is the task of trying to make
people see things that are not clearly visible.
The 19th century economist Frederic Bastiat
wrote an essay on “That Which is Seen, and
That Which is Not Seen” (see

http://bastiat.org/en/twisatwins.html.)

It is particularly hard to expose the
effects of trade restrictions.
Trade restriction policies that tax or
otherwise hinder people from buying
products from other countries are
labelled protectionism, which is an
unfortunate term because it makes the
effects of these policies seem too benign.
Who can be against protecting people?
The reality is that trade protection
policies protect some people, but they
don’t protect and in fact hurt other
people. The problem is that the people
that are helped are seen and the people
that are hurt are not seen.

If an American pays a higher price for a
product that could have been available
at a lower price from another country
in the absence of an import tax (tariff),
we have to ask this question:
what is that person not buying
with the money they’re not saving
because they have to pay the higher
price? Obviously economists have no
idea what the people would have bought in
that alternate reality. The
people whose jobs are lost because
of the people not buying their
products won’t even know that is
the reason. The people that are
hurt by the trade restrictions are
often unseen. But they are no less
real. These are actual flesh-and-blood
people being hurt by trade restriction
policies.

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–Douglas Downing
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