Raymond Richman - Jesse Richman - Howard Richman
Richmans' Trade and Taxes Blog
How we settle problems in the United States -- my recent op-ed in Virginian Pilot
My recent op-ed for the Virginian Pilot has reached more than 15 thousand shares on Facebook. Here are the first few paragraphs:
To read the rest of the essay, follow the link to https://pilotonline.com/opinion/columnist/guest/article_df3d1014-e39b-11e8-9db2-efca95e310de.html.
Robert Skidelsky on the case for compensated free trade
According to his Project Syndicate biographical sketch, Robert Skidelsky is "Professor Emeritus of Political Economy at Warwick University and a fellow of the British Academy in history and economics, is a member of the British House of Lords. The author of a three-volume biography of John Maynard Keynes, he began his political career in the Labour party, became the Conservative Party’s spokesman for Treasury affairs in the House of Lords, and was eventually forced out of the Conservative Party for his opposition to NATO’s intervention in Kosovo in 1999."
Skidelsky's latest column for Project Syndicate is a tour-de-force summation of the trade challenge and the appropriate solution -- a mechanism to automatically shift trade towards balance. The column can be read at https://www.project-syndicate.org/commentary/compensated-free-trade-allows-protectionism-by-robert-skidelsky-2018-11.
He begins by framing the issue as follows:
According to Harvard’s Dani Rodrik, the nation-state, democracy, and globalization are mutually irreconcilable: we can have any two, but not all three simultaneously. In fact, there may be a solution to Rodrik's “trilemma.”
And that solution in Skidelsky's view is compensated free trade.
The scaled tariff is a similar mechanism and would also achieve the same end, albeit in some what different ways....
Doing the Right Thing on Trade
The Trump Administration is right to pursue a policy aimed at addressing the trade deficits faced by the US around the world. But the current policies are having only limited effect on the overall US trade deficit -- so far more than counterbalanced by the consequences of the tax cuts and higher interest rates which have pushed the dollar higher and kept imports cheap.
The right approach going forward is to begin moving towards what Frank Kirkland calls a "closed loop" approach to the trade balance, or what Masch calls Compensated Free Trade, what we have termed the Scaled Tariff, or the country-specific import certificates. This is particularly crucial because at some point, whether in 2021 or 2025, the Trump Administration will leave office. And the advocates for Trump's trade policies...
Another Economist Discovers the Scaled Tariff -- A new and perhaps more marketable name too
Vladimir Masch first presented his idea similar to our scaled tariff idea back in 2004. He gave it a more marketable name though -- Compensated Free Trade of CFT for short. We seem to have been working in parallel for much of the last decade and a half without knowing of each other's work.
A good idea who's time has come will be invented simultaneously or sequentially by many authors. So far we know of three groups who independently developed it: the Richmans, Masch, and Frank Kirkland. Warreb Buffet also came up with a related approach. This is an idea who's time has come.
Journal of Economic Literature:
Atlantic Economic Journal: