This from the Club for Growth:

In 1930, Congress passed and President Hoover signed into law the Smoot-Hawley Tariff Act. At the time, this protectionist measure was vigorously opposed by 1,028 of the nation’s top economists. They rightly predicted the tariffs would devastate the economy. And, in fact, the country subsequently plunged into the Great Depression.

Now some in Congress are considering ways to enact similar protectionist policies against China. Once again, 1,028 of America’s top economists, from all 50 states and top universities, have signed the following petition sponsored by the Club for Growth in opposition to protectionist policies against China. In addition to many other prominent and well-respected economists, signatories include Nobel Laureates Finn Kydland, Edward Prescott, Thomas Schelling, and Vernon Smith.

Here’s the 1930 petition as it ran in the New York Times.

Here’s the 2007 petition as it ran in the Wall Street Journal this morning.

The full text of the petition is below.

What never ceases to amaze me is how many people are worried about things like “trade deficits.”

I have a trade deficit with my local grocer.  I’m not that worried about it.  But speaking to international trade, think of it this way: Trade happens between just about every single country in the world.  The US trades, to different extents, with most of the nations in the world.  Whether or not we have a bi-lateral trade deficit with any one of those countries is meaningless.  So we buy more stuff from China than China buys from us.  Big deal.  There are other nations that buy more of our stuff than we buy of theirs.

Also, consider the reasons why we buy stuff from other countries in the first place.  When you go shopping for a product, what do you consider?  What’s highest on your list of priorities?  Where the product was made?  Or are you more worried about price and quality?  I think for most of us, the price and quality of a product are the deciding factors.  And if the product that meets our standards of price and quality is made in China, shouldn’t we be able to purchase it?  Why should, because of protectionist trade policies, we have to purchase products that are more expensive than what we could get from China or another foreign country?

My point is that free trade with nations like China brings cheap products into our country that people want to buy (that people want to buy them is why these products are in our country to begin with).  Because we have those cheaper products, we can get what we want for less than we could otherwise.  Meaning that we have more money to spend on other stuff.  Meaning, in summary, that free trade with countries like China means the average American can buy more products for less money.

That’s a huge benefit for the people of this nation.  Why should we throw that benefit away?  And if other nations block our products from coming into their borders, thus denying their citizens the more-goods-for-less-money benefit of free trade, why should we want to follow their bad example?

PETITION
Concerning Protectionist Policies Against China

We, the undersigned, have serious concerns about the recent protectionist sentiments coming from Congress, especially with regards to China.

By the end of this year, China will most likely be the United States’ second largest trading partner. Over the past six years, total trade between the two countries has soared, growing from $116 billion in 2000 to almost $343 billion in 2006. That’s an average growth rate of almost 20% a year.

This marvelous growth has led to more affordable goods, higher productivity, strong job growth, and a higher standard of living for both countries. These economic benefits were made possible in large part because both China and the United States embraced freer trade.

As economists, we understand the vital and beneficial role that free trade plays in the world economy. Conversely, we believe that barriers to free trade destroy wealth and benefit no one in the long run. Because of these fundamental economic principles, we sign this letter to advise Congress against imposing retaliatory trade measures against China.

There is no foundation in economics that supports punitive tariffs. China currently supplies American consumers with inexpensive goods and low-interest rate loans. Retaliatory tariffs on China are tantamount to taxing ourselves as a punishment. Worse, such a move will likely encourage China to impose its own tariffs, increasing the possibility of a futile and harmful trade war. American consumers and businesses would pay the price for this senseless war through higher prices, worse jobs, and reduced economic growth.

We urge Congress to discard any plans for increased protectionism, and instead urge lawmakers to work towards fostering stronger global economic ties through free trade.