It is like comparing apples to oranges


My grandson is 2.  Now, granted I may be biased because I think he is pretty special, but even he knows the phrase that you can't compare apples to oranges.  They are different colours.  One you can eat by just taking a bite and the other you have to get someone to peel off the skin.  They taste different and most importantly, one tastes good with chocolate and the other does not.

The whole problem with Trump's approach to trade and tariffs is that he thinks that apples and oranges are the same thing.  Trade just doesn't work that way.

Let me explain.  I have an acquaintance who makes perogies and her perogies are the absolute best.  I really really love her perogies and want them very badly.  I actually could make my own perogies but it would take a great deal of my time and they wouldn't taste as good.   She is a new mother and sometimes needs a break from her baby.  I love babies and spending time with a baby is something that I really enjoy.  So, we are going to trade perogies for babysitting.   It won't be an equal trade because it is like we are comparing apples to oranges.  They are not equal things.  But, we both value something.  I value perogies and she values some respite.  As she enjoys making perogies and does this often, she can make a lot of perogies in a short period of time.  I love spending time with babies.  We both have powerful bargaining chips so we work out an agreement.  3 dozen perogies/1 hour babysitting.  That seems fair for both of us.  Someone else looking in on our agreement may think that I got the sweetheart deal.  Another person may think that she is taking advantage of me.  Yet, both of us are happy so it is really none of their business.

Now, imagine it on a national scale.  Trump says that Justin said that we make $100 Billion on trade surplus even though Justin has never said that.  Trump says that it is actually a $17 Billion trade deficit that US has with Canada.  He apparently got that figure out of his head.

In actuality, Canada and US trade $2B in goods and services each day.  They are trading more than just perogies and babysitting.  That is the goal of the Free Trade Agreement.  There are somethings that we have an excess of that are easy for us to trade and there are some things that we want from the US and vice versa.  There are probably millions of items to trade.  The goal is that not every single item is traded equally, the goal is at the end of the day, both countries will come out even.  So, you can't look at one item and compare it to another item and assume they are the same.  It is like comparing apples to oranges.

Trade agreements are notoriously complex.  Free trade agreements are even more so, however, they have the same premise that you can not compare apples to oranges.   This is the common sense that my 2 year old grandson understands.

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