New Ideas, Fueled By Trade, Are Source of Wealth

Conservative and liberal economists agree that new ideas are the fundamental source of higher living standards. We urgently need new biotechnologies, a cure for AIDS and a cleaner energy infrastructure, to name just a few. Trade is part of the path toward achieving those ends. A wealthier China and India also mean higher potential rewards for Americans and others who invest in innovation. A product or idea that might have been marketed just to the United States and to Europe 20 years ago could be sold to billions more in the future.

Globalization is not the primary source of trouble for most American workers. Health care problems, bad schools for our children or, in recent times, bad banking practices have all produced greater disruptions — and these have been fundamentally domestic failings.

We need more awareness of the cosmopolitan benefits of trade and the often hidden — but no less real — gains for ordinary Americans. If we look at trends of the last 20 years, we have every reason to believe that the modern era of free trade is just getting started.

~Tyler Cowen, "This Global Show Must Go On," in today's NY Times