Economic nationalists should be the very LAST people to endorse the use of retaliatory subsidies

Source: Cafe Hayek
by Don Boudreaux

“If subsidies are generally economically beneficial — if governments are generally good at ‘picking winners’ — there is no need or cause for the U.S. government to wait for other governments to use subsidies before it uses subsidies. Yet most of us Americans are justifiably skeptical of subsidies. We correctly understand that subsidies doled out by the national, state, and local governments generally inflict damage on the American economy. We realize that subsidies slow economic growth. We know that governments are losers at picking winners. We grasp the reality that subsidies misallocate resources. We sensibly conclude that subsidies make us, on the whole, poorer than we would be without subsidies. The major exception to this healthy hostility to subsidies is the set of subsidies said to be in retaliation for foreign-government subsidization of foreign industries that compete with American industries.” (03/24/17)