Mr. Trump, don't build those walls!

Donald J. Boudreaux

Millions of words have been written analyzing Donald Trump's election to be the 45th U.S. president. I join all sensible people in being grateful that Hillary Clinton was denied her bid to unleash from the Oval Office her economically destructive policies. Nothing but ill could have come from her absurd faith in the power of politicians and bureaucrats to engineer us all to greater happiness.

Yet I fear Trump's presidency. Although political realities will ensure he's unable to implement all of his campaign promises, much of his program will likely be put into place. Yet too much of it makes no economic sense. 

Most famously, of course, Trump wants to build a wall along the U.S.-Mexico border. This idea is bad economics.

Human beings are the ultimate resource — so taught the late economist Julian Simon. Humans create, innovate and produce. Nothing in or on the ground or in the water would be of any value without creative minds and productive hands transforming those things into genuine resources and consumer goods.

And as Adam Smith taught, as the labor force and markets grow, workers become more specialized, raising productivity. Each worker becomes more prosperous.

Yet Trump wants to prevent America from receiving more of this ultimate resource. If the goal is to enrich Americans, such a wall makes even less economic sense than would a policy that walls Americans off from newly discovered petroleum, iron ore and magnesium.

Trump also wishes to surround America with higher tariff walls. The notion — as musty as it is mistaken — is that by domestically producing goods we would otherwise import, we're enriched. But this is nonsense. Reducing the flow of goods into America — goods that Americans voluntarily buy — doesn't enrich us; it makes us poorer.

Sure, there are gains to the workers and firms protected by tariff walls from their fellow Americans' ability to trade freely with foreigners. But these protected firms' resulting higher outputs are produced with resources from elsewhere in the economy. Output and opportunity in other parts of the economy shrink. American firms diverted by tariff walls into producing, say, more steel, rejoice. But this rejoicing ignores the jobs that these tariff walls destroy elsewhere in America and the loss of output from other domestic industries.

It's easy to rejoice when a wall, literal or figurative, enriches you. And it's even easier when the destruction wrought elsewhere by that wall is invisible. When a tariff wall causes people in Louisiana and Oregon to pay higher prices for steel made in Pittsburgh, no one can know how they would otherwise have used the extra funds they now pay to Pennsylvania steel producers. But those funds must be diverted from somewhere.

Yet because those somewheres are many, no one domestic industry suffers any great loss from higher steel tariffs. The destruction wrought by tariff walls is dispersed and, hence, invisible. But the sum of the losses is greater than the gain to domestic steel producers.

Americans on the whole are made poorer