| I think there may be a case for retaliation on the basis of predatory business practices, for example, "dumping". However, discounting in order to build market share is a legitimate practice, one must be trying to gain quasi- monopolistic advantage for it to be predatory. In general, Friedman would say that the foreign company sends us a bunch of cars or cameras or shirts in return for---- pieces of paper. Meanwhile, we are paying a fifth of what a Japanese consumer pays for a Fuji camera, and have greater consumer choice and cheaper prices. Of course, the Japanese have to do something with these pieces of paper, eventually, whether it be to invest them or buy stuff from us. One way or another, it flows back in our direction. Thus, we come out ahead, even if we run a trade deficit....... |
