That's the same logic that people had during midieval times. And guess what... it didn't work. Free markets on the other hand work quite nicely. As one of the other posters said trading outside your borders is good. Other areas may have a competitive advantage to whatever product you are seeking. That is, some areas can produce something very efficiently, because of geographical location, the skills of laborers in the particular area, or for other reasons. For example, if Portland Oregon decides we don't want to trade anymore and we suddenly realize we need oil, what do we do? Well, we may be able to abstract a little from the ground, but not enough to be inexpensive, it would probably become a huge expense just to drive. For us it is far better of an idea to purchase oil from another state such as Texas which has an abundance of oil. We can get it for much less than it would cost for us to produce it in-state, and put labor in areas of Oregon specialization, such as lumber. We then in turn sell our specialized product, which others want since we can sell it to them for less and the quality is higher than if they were to produce it on their own. In turn, Oregon sells more lumber than we would normally, since we have more customers, which creates more jobs, and this generates more revenue for Oregon in general, for people, business and government.
Now this is just a hypothetical example, but apply this concept in general. In realistic terms, for the most part the effect on revenue is both positive and negitive, and most likely in small amounts, however the net effect is gain.
There is a very good reason that we trade with others, we would not have nearly the standard of living we do today if not for this. Just look at the poor living conditions for commoners back in 12th century Europe, during this time they thought along the same lines. This is outdated thinking and has shown to be incorrect. It is very intuitive, but intuitions are not always correct. That's why economics came about, to learn from mistakes for the good of the people.
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That's the same logic that people had during midieval times. And guess what... it didn't work. Free markets on the other hand work quite nicely. As one of the other posters said trading outside your borders is good. Other areas may have a competitive advantage to whatever product you are seeking. That is, some areas can produce something very efficiently, because of geographical location, the skills of laborers in the particular area, or for other reasons. For example, if Portland Oregon decides we don't want to trade anymore and we suddenly realize we need oil, what do we do? Well, we may be able to abstract a little from the ground, but not enough to be inexpensive, it would probably become a huge expense just to drive. For us it is far better of an idea to purchase oil from another state such as Texas which has an abundance of oil. We can get it for much less than it would cost for us to produce it in-state, and put labor in areas of Oregon specialization, such as lumber. We then in turn sell our specialized product, which others want since we can sell it to them for less and the quality is higher than if they were to produce it on their own. In turn, Oregon sells more lumber than we would normally, since we have more customers, which creates more jobs, and this generates more revenue for Oregon in general, for people, business and government.
Now this is just a hypothetical example, but apply this concept in general. In realistic terms, for the most part the effect on revenue is both positive and negitive, and most likely in small amounts, however the net effect is gain. There is a very good reason that we trade with others, we would not have nearly the standard of living we do today if not for this. Just look at the poor living conditions for commoners back in 12th century Europe, during this time they thought along the same lines. This is outdated thinking and has shown to be incorrect. It is very intuitive, but intuitions are not always correct. That's why economics came about, to learn from mistakes for the good of the people.