Like so much that’s worth learning, trade is complicated

tradeTeachers spend a lot of time trying to break down difficult concepts and make them easier for our students to digest, but what about when the truth is just complicated?

How can we combat the crisis of oversimplification in this country and get our kids to muddle around in complexity?

This weekend, I taught my last session of “Preparing to Teaching High School Economics” with a group of 10 Minnesota teachers who are new to econ this year. I decided to start the day by talking about trade, which basically feels like a four-letter word these days. (I wouldn’t blame them for skipping it altogether, though it would be a shame.)

I drew a simple supply and demand graph for them, showing the U.S. sugar market without any trade, then we opened the market and saw how lower world prices would affect both U.S. consumers (happy!!) and U.S. producers (very angry).

One by one, we worked through all of the implications. Who does trade help? Who is hurt? Why do the producers lobby their legislators, while consumers do not? How would a 20% tariff on Mexican imports affect American households?

Or what if you’re a low-cost country, like China, and trade means more exports rather than imports? How does that impact Chinese workers, who produce a lot of stuff (like toys, T-shirts and electronics parts) that they can’t afford to buy?

At the end of our discussion, one of the teachers asked: “So can we just leave it like that? Point out the good and the bad and not answer it for them?”

Yes, I think so. Economists are in near agreement that trade is good — and I tell my students that — but “beneficial to society” is not the same thing as “pain-free.” Trade is good, and it creates losers along with the winners. All of our lovely economic models don’t capture the human cost of shuttered factories and “redundant” workers.

Back when “anti-trade” positions belonged to the political left, like unions and environmentalists and human rights activists, I explained their views the best I could. Now that these positions belong to President Trump’s team, I’ll explain them again.

Trade — like education, parenting, military policy, personality theory and so many other topics — is just complicated. Students want us to tell them answers (just like adults) so they can “get it right,” but that’s not always useful. 

What we need to do is give them the skills and knowledge they need to think about these issues —  in all their lovely complexity — for themselves.