A former friend sent me an email post that had been forwarded a hundred times. It went like this:
A physics teacher in high school, once told the students that while one grasshopper on the railroad tracks wouldn’t slow a train very much, a billion of them would . With that thought in mind, read the following, obviously written by a good American .
Good idea . . . one light bulb at a time . . . .
Check this out … I can verify this because I was in Lowe’s the other day for some reason and just for the heck of it I was looking at the hose attachments . They were all made in China . The next day I was in Ace Hardwareand just for the heck of it I checked the hose attachments there . They were made in USA . Start looking .
In our current economic situation, every little thing we buy or do affects someone else – even their job . So, after reading this email, I think this lady is on the right track . Let’s get behind her!
It goes on to talk about all the products she buys every day, including chocolate, tooth paste, light bulbs, washing products, and others. It ends with a request to read the labels before buying. It sounds so warm and fuzzy, who could oppose it? In fact, why don’t we just pass a law to require it?
Well, for one, all the people in Mexico, Canada, China, France, England, Germany, Spain, Russia, India, and every other country in the world. Remember how well that Smoot-Hawley tariff worked out for the good old U.S.A.? It is widely credited with extending a small recession into what we know and love as the great depression. This is a quick summary of the tariff from an Econtalk podcast with Russ Roberts talking to Thomas Rustici on the subject:
The legislative history of Smoot-Hawley: Herbert Hoover was elected on a promise to impose tariffs–to protect the farmers in America. But America at this time–about half of its export income came from the farm sector. We were the world’s largest exporter of agricultural goods–as we still are today. So tariffs would hurt farmers, not help them. In March and April of 1929, right after inaugurated, tariff went through the House of Representatives; passed the House in fall of 1929. The House was very protectionist at this time; it expanded the tariff to virtually everything, at very high rates. Senate at this time was more free trade; 16 free trade Senators blocking Smoot-Hawley in the Senate. On October 21, 1929, the 16 free trade Senators log-rolled; said they’d join in if you give tariffs for the industries in their states. The Senate then supported the Smoot-Hawley bill. Tariff increases from 38%-60%–almost a doubling. Immediate ramifications. The day the 16 Senators switched, on October 21, is when the market began its slide; lost 1/3 of its value before the Crash on October 29, 1929. When you read the financial papers–Wall Street Journal, New York Times–they have front page stories on one side with markets decline and other side Smoot-Hawley passes; nobody connecting the dots.
Another approach to the email is to have the sender consider it in terms they can understand. If restricting trade is such a good idea, then why stop at the U.S. border? Why not restrict trade between states, and keep all those great jobs in our state. In fact, I’m not really fond of those who live in the Eastern part of my state, so let’s impose tariffs on goods from them. And why stop there? I really don’t like the people in the next town over, so let’s impose tariffs on them, and keep the jobs in our town. And since that’s such a good idea, I really don’t like my neighbor very much, so I’m going to stop buying anything my family didn’t make in our house, from scratch. I’ll have my son mine the rock to make steel, my daughter plant crops to grow our food, and my wife make all our own clothes. Think how many jobs I can save or create in my household if I don’t spend money outside of it. And I really don’t think I trust my son and daughter very much, so….