On his blog, Paul Krugman discussed how “the conventional case for trade liberalization relies on the assertion that the government could redistribute income to ensure that everyone wins.” Aside from the historical and intellectual issues with this statement, Krugman makes another rather anti-Progressive point (albeit he does so unintentionally): that wealth should be redistributed from the poor to the wealthy.
“Whoa whoa whoa, back that train up!” you might be saying. “How on Earth is Krugman making that argument? He is a noted proponent of redistribution from the wealthy to the poor!”
You’d be right to say that; he is such a proponent. But this is where his argument becomes contradictory.
If, indeed, the role of the government is to redistribute from the winners of trade to the loser of trade, then that necessarily means that gains must be transferred from the poor to the wealthy.
Who benefits…
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