Category: Law
Three Simple Principles of Trade Policy
Are we in a trade war today? Who knows? Doesn’t really matter. It’s always a good time to review important principles. A good source is Doug Irwin’s Three Simple Principles of Trade Policy published in 1996. Below I have updated occasionally with more recent data.
Principle 1: A Tax on Imports is a Tax on Exports
Exports are necessary to generate the earnings to pay for imports, or exports are the goods a country must give up in order to acquire imports….if foreign countries are blocked in their ability to sell their goods in the United States, for example, they will be unable to earn the dollars they need to purchase U.S. goods.
…The equivalence of export and import taxes is not an obvious proposition, and it is often counterintuitive to most people. Imagine taking a poll of average Americans and asking the following question: “Should the United States impose import tariffs on foreign textiles to prevent low-wage countries
from harming thousands of American textile workers?” Some fraction, perhaps even a sizeable one, of the respondents would surely answer affirmatively. If asked to explain their position, they would probably reply that import tariffs would create jobs for Americans at the expense of foreign workers and thereby reduce domestic unemployment.Suppose you then asked those same people the following question: “Should the United States tax the exportation of Boeing aircraft, wheat and corn, computers and computer software, and other domestically produced goods?” I suspect the answer would be a resounding and unanimous “No!” After all, it would be explained, export taxes would destroy jobs and harm important industries. And yet the Lerner symmetry theorem says that the two policies are equivalent in their economic effects.
Exports and imports rise and fall together. It is surely obvious that if you want more imports you must export more (barring a bit of borrowing see below). The same thing is true in other countries. As a result, it is also true that when you import more you export more.
Principle 2: Businesses are Consumers Too
Business firms are, in fact, bigger consumers of imported products than are U.S. households.
As of 2024, more than 64% of imports are intermediate products. See here for the data.
By viewing imports not as final consumer goods but as inputs to U.S. production, policy makers can more clearly recognize that the issue is not so much one of “saving” jobs but of “trading off’ jobs between sectors. This brings home forcefully the most important lesson in all of economics-there is no such thing as a free lunch. Every action involves a trade-off of some sort. Higher domestic steel prices help employment in the steel industry but harm employment in steel-using industries. Higher domestic semiconductor prices help employment in the semiconductor industry but harm employment in semiconductor using industries. As john Stuart Mill wrote in 1848 in the context of import protection, “The alternative is not between employing our own country-people and foreigners, but between employing one class or another of our own country-people.”
Principle 3: Trade Imbalances Reflect Capital Flows
There is a fundamental equation of international finance that relates this net borrowing and lending activity to the current account. The equation is:
Exports – Imports = Savings – Investment
The powerful implication of this equation is that if a country wishes to reduce its trade deficit, the gap between its domestic investment and its domestic savings must be reduced.
…A country’s trade balance is related to international capital flows–not with open or closed markets, unfair trade practices, or national competitiveness. If a country wants to solve the “problem” of its trade deficit, it must reverse the international flow of capital into its country. In many cases net foreign borrowing can be reversed by reducing the government fiscal deficit. [emphasis added, AT]
Doug concludes:
These three simple principles of trade policy…[have] stood the test of time, they come as close to truths as anything economists have to offer in any area of policy controversy. Yet they are routinely denied, explicitly or implicitly, in trade policy debates in the United States and elsewhere. I do not imagine that a greater appreciation of these principles would invariably bring about more liberal trade policies; I offer them, rather, in the more modest hope that they might lead to sounder debates in which the real consequences of government policies are confronted more seriously than at present.
Hat tip: Erica York.
What should I ask Sheilagh Ogilvie?
She is a Canadian economic historian at Oxford, here is from her home page:
I am an economic historian. I explore the lives of ordinary people in the past and try to explain how poor economies get richer and improve human well-being. I’m interested in how social institutions – the formal and informal constraints on economic activity – shaped economic development between the Middle Ages and the present day.
And:
My current research focusses on serfdom, human capital, state capacity, and epidemic disease. Past projects analysed guilds, merchants, communities, the family, gender, consumption, finance, proto-industry, historical demography, childhood, and social capital. I have a particular interest in the economic and social history of Central and Eastern Europe.
Here is her Wikipedia page. Her book on guilds is well known, and her latest is Controlling Contagion: Epidemics and Institutions from the Black Death to Covid. Here are her main research papers.
So what should I ask her?
Letting China into the WTO was not the key decision
We study China’s export growth to the United States from 1950–2008, using a structural model to disentangle the effects of past tariff changes from the effects of changes in expectations of future tariffs. We find that the effects of China’s 1980 Normal Trade Relations (NTR) grant lasted past its 2001 accession to the World Trade Organization (WTO), and the likelihood of losing NTR status decreased significantly during 1986–92 but changed little thereafter. US manufacturing employment trends support our findings: industries more exposed to the 1980 reform have shed workers steadily since then without acceleration around China’s WTO accession.
That is from a new and forthcoming JPE article by George Alessandria, Shafaat Yar KhanArmen KhederlarianKim J. RuhlJoseph B. Steinberg.
The culture that is German (Roman)
We compare present-day regions that were advanced by Roman culture with those that remained outside of Roman influence. Even when accounting for more recent historical factors, we find that regions developed by Roman civilization show more adaptive personality patterns (Big Five) and better health and psychological well-being today. Results from a spatial regression discontinuity design indicate a significant effect of the Roman border on present-day regional variation in these outcomes. Additional analyses suggest that Roman investments in economic institutions (e.g., trade infrastructure such as Roman roads, markets, and mines) were crucial in creating this long-term effect. Together, these results demonstrate how ancient cultures can imprint a macro-psychological legacy that contributes to present-day regional inequalities.
That is from a recent paper by Obschonka, et.al., via Alexander Le Roy. Also on the German front:
The German parliament will debate on Thursday, January 30th whether to ban the opposition right-wing Alternative für Deutschland (AfD) party.
A group of lawmakers, 113 MPs, have called for parliament to discuss a motion which would invite the constitutional court to decide whether the party is unconstitutional.The motion is supported by MPs from the centre-right CDU/CSU alliance, the far-left Die Linke, as well as the two governing parties, the Social Democrats (SPD) and the Greens.
The signatories claim that the AfD “opposes central basic principles of the free democratic basic order,” questions human dignity, and strives for the “ethno-nationalist strengthening” of the German identity.
Of course the strongest support for AfD is not to be found in Trier. I would not myself support AfD, for both policy and cultural reasons. But I find it strange that Europeans so often see the United States as the locale where democracy is in danger. Right now AfD polls as the second most popular party in Germany — beat them at the ballot box!
FDA Deregulation of E-Cigarettes Saved Lives and Spurred Innovation
What would happen to drug development if the FDA lost its authority to prohibit new drugs? Would research and development boom and lives be saved? Or would R&D decline and lives be lost to a flood of unsafe and ineffective drugs? Or perhaps R&D would decline as demand for new drugs faltered due to public hesitation in the absence of FDA approval? In an excellent new paper Pesko and Saenz examine one natural experiment: e-cigarettes.
The FDA banned e-cigarettes as unapproved drugs soon after their introduction in the United States. The FDA had previously banned other nicotine infused products. Thus, it was surprising when in 2010 the FDA was prohibited from regulating e-cigarettes as a drug/device when a court ruled that Congress had intended for e-cigarettes to be regulated as a tobacco product not as a drug.
As of 2010, therefore, e-cigarettes were not FDA regulated:
…e–cigarette companies were able to bypass the lengthy and costly drug approval process entirely. Additionally, without FDA drug regulation, e–cigarette companies could also freely enter the market, modify products without approval, and bypass extensive post–market reporting requirements and quality control standards.
Indeed, it wasn’t until 2016 that the FDA formally “deemed” e-cigarettes as tobacco products (deemed since they don’t actually contain tobacco) and approvals under the less stringent tobacco regulations were not required until 2020. For nearly a decade, therefore, e-cigarettes were almost entirely unregulated and then lightly regulated under the tobacco framework. So, what happened during this period?
Pesko and Saenz show that FDA deregulation led to a boom in e-cigarette research and development which improved e-cigarettes and led to many lives saved as people switched from smoking to vaping.
The boom in research and development is evidenced by a very large increase in US e-cigarette patents. We do not see a similar increase in Australia (where e-cigarettes were not deregulated) nor do we see an increase in non e-cigarette smoking cessation products (figure 1a of their paper not shown here).
Estimating the decline in smoking and smoking-attributable mortality (SAM) is more difficult but the authors assemble a large collection of data broken down by demographics and they estimate that prohibiting the FDA from regulating e-cigarettes reduced smoking attributable mortality by nearly 10% on average each year from 2011-2019 for a total savings of some 677,000 life-years.
The authors pointedly compare what happened under deregulation of e-cigarettes–innovation and lives saved–with what happened to similar smoking cessation products that remained under FDA regulation–stagnation and no reduction in smoking attributable mortality.
A key takeaway on the slowness of FDA drug regulation is that it took 9 years before nicotine gum could be sold with a higher nicotine strength, 12 years before it could be sold OTC, and 15 years before it could be sold with a flavor. Further, a recent editorial laments that there has been largely non–existent innovation in FDA–approved smoking cessation drugs since 2006 (Benowitz et al., 2023). In particular, the “world’s oldest smoking cessation aid” cyctisine, first brought to market in 1964 in Bulgaria (Prochaska et al., 2013), and with quit success rates exceeding single forms of nicotine replacement therapy (NRT) (Lindson et al., 2023), is not approved as a drug in the United States.
The authors conclude, “this situation raises concern that drugs may be over–regulated in the United States…”. Quite so.
Addendum: A quick review on the FDA literature. In addition to classic works by Peltzman on the 1962 Amendments and by myself on what we can learn about the FDA from off-label pricing we have a spate of recent new papers including Parker Rogers, which I covered earlier:
In an important and impressive new paper, Parker Rogers looks at what happens when the FDA deregulates or “down-classifies” a medical device type from a more stringent to a less stringent category. He finds that deregulated device types show increases in entry, innovation, as measured by patents and patent quality, and decreases in prices. Safety is either negligibly affected or, in the case of products that come under potential litigation, increased.
and Isakov, Lo and Montazerhodjat which finds that FDA statistical standards tend to be too conservative, especially for drugs meant to treat deadly diseases (see my comments on their paper and more links in Is the FDA Too Conservative or Too Aggressive?)
See also FDA commentary, for much more from sunscreens to lab developed tests.
Questions about LLMs (from my email)
From Naveen:
So much talk of “AI safety” and too little in the way of practical questions like these that are going to be important in the near future.
Should law enforcement be able to subpoena AI assistants about your information? For example, I use the free GPT-3.5/4 version and it already has a lot of my personal information on it.
The other day, when I asked an insurance claims related question in a new chat window without reminding it of the fact that my car was recently totaled, it includes in the answer that “but that wouldn’t apply to you, since your car was declared non-repairable and you were declared as not at-fault.” So it remembers personal information I mentioned weeks ago even though I never told it to commit to its memory.
ChatGPT is such a rudimentary free AI system compared to the personal AI assistants we will get in the near future which will have all my travel data, health data, financial data, mental health data, personal data and what I’ve been up to.
Should law enforcement be allowed to subpoena such AI assistants? Should there be legislation mandating data retention so law enforcement can access it much like telephone records or the opposite — mandating data encryption so it can’t be accessed?
The slide toward growing protectionism?
That is the topic of my latest Bloomberg column, here is one part of the argument:
Start with the distinction between trade in goods and trade in services. When a US manufacturer sells tractors overseas, that’s goods. When a US software firm creates an AI medical diagnostic tool and sells access via the internet to foreigners, that’s services.
It is much easier to keep trade “free” for the first category than for the second. The tractor crosses a border at a specific place and time. It may face additional regulation once inside the foreign country, but the transaction is relatively clean.
An online medical service, by contrast, could “cross the border” — that is, be used by someone outside the US — hundreds or thousands of times per day. It may also face licensing requirements, foreign liability law, extensive testing and, if the country has multiple jurisdictions, layers of regulation. In the European Union, the website itself would be subject to extensive regulation through laws regarding data, privacy and AI. Even within the EU, a supposed free-trade area, there are restrictions on trade in legal, medical and notary services, to name a few examples.
The wisdom or foolishness of these regulations is not the point. They exist, and most are not going away anytime soon. In fact, they will become only more important as the provision of services expands as a share of the global economy.
In the US, much of this growth occurs in education, health care and, especially, technology. Nvidia, for instance, depending on fluctuations in share prices that day, is often worth more than the entire German and Italian stock markets combined. Efforts to “harmonize” (i.e., increase) corporate taxation thus are more harmful to US interests than would have been the case a decade ago.
Any world trading order that broadly stays put is thus weighted against the exporting interests of the US. That is essential background for understanding the debate over trade prompted by President Donald Trump’s various proposals.
Recommended.
Milei Implements Peer Approval for Food
Reason: In a sweeping move to overhaul Argentina’s food trade policies, Javier Milei’s administration officially deregulated food imports and exports on Monday. The reform, outlined in Decree 35/2025, seeks to boost foreign trade, cut bureaucratic red tape, and lower consumer prices.
Federico Sturzenegger, head of the Ministry of Deregulation and State Transformation, explained in a post on X that the measure “seeks cheaper food for Argentines and more Argentine food for the world.”
Under the new policy, food products and packaging certified by countries with “high sanitary surveillance” can now enter Argentina without any additional registration or approval processes. These items will be automatically recognized under the Argentine Food Code, cutting down on administrative delays and costs for importers.
The legislation identifies countries such as Australia, New Zealand, Canada, the United States, Israel, Japan, Switzerland, and the United Kingdom, as well as the European Union, as having similar or higher sanitary standards than Argentina.
As Sturzenegger explains in his post, this measure “eliminates requirements to register and authorize: samples, products, establishments, warehouses, utensils, and containers (32 pages of paperwork).”
An excellent “peer approval” policy and one that I have long supported when it comes to the FDA and drug approvals. In fact, since 2010 the US FDA has begun to recognize other countries as having comparable food safety systems. To date, Canada, Australia and New Zealand have been recognized with a Systems Recognition partnership.
Systems Recognition (SR) is a partnership between the U.S. Food and Drug Administration (FDA) and a foreign regulatory counterpart, in which the agencies have concluded that they operate comparable regulatory programs that yield similar food safety outcomes.
Argentina’s policy is unilateral and assumes equivalence if a country uses recognized standards (e.g., Codex Alimentarius) or has high sanitary vigilance while the FDA’s SR policy is bilateral and involves more regulatory harmonization and investigation. I prefer the Argentinian approach. Nevertheless, both programs have the goals of simplifying trade, avoiding duplicate inspections, and helping to prioritize scarce inspection resources.
I encourage the FDA to build on SR for food and extend it to drugs. This could be done in a minor and major way, both of which would useful. The minor reform would be peer approval for already-approved US drugs. In this way, importation could ease drug shortages. The FDA has done this in the past on an ad-hoc basis but it should be made permanent. The second, more major reform, would to extend peer-approval to any drug or device approved by a stringent authority.
Democracy, Capitalism and Monarchy (Yarvin)
The Yarvin interview in the NYTimes magazine illustrates the change in vibes, but frankly, I was bored. It’s amusing when Yarvin tweaks liberals by pointing out that FDR was an authoritarian, but Liberal Fascism did it better.
More generally, much of Yarvin’s thinking is superficial. He thinks, for example, that capitalism works because firms are monarchies.
Yes. I think that having an effective government and an efficient government is better for people’s lives. When I ask people to answer that question, I ask them to look around the room and point out everything in the room that was made by a monarchy, because these things that we call companies are actually little monarchies. You’re looking around, and you see, for example, a laptop, and that laptop was made by Apple, which is a monarchy.
There are many errors here. First, Apple is one firm among countless others most of which do not produce hugely successful products. The big question is not how Apple produces but how Apple is produced. Firms operate as planned entities but they are embedded in and constrained by a broader sea of market competition. It’s the competitive environment that drives innovation, efficiency, and consumer satisfaction.
Second, Mises was closer to the truth when he wrote in Planned Chaos that it’s the consumers not the producers who are monarchs:
In the market economy the consumers are supreme. Their buying and their abstention from buying ultimately determine what the entrepreneurs produce and in what quantity and quality. It determines directly the prices of consumer goods and indirectly the prices of all producer goods, viz., labor and material factors of production. It determines the emergence of profits and losses and the formation of the rate of interest. It determines every individual’s income…The market adjusts the efforts of all those engaged in supplying the needs of the consumers to the wishes of those for whom they produce, the consumers. It subjects production to consumption.
Capitalist firms are disciplined by the necessity of persuading consumers to purchase their products and by competition. Successful firms must continuously meet our desires and needs to survive. When Apple fails to do so, it will face the same fate as countless firms before it—obsolescence and failure.
Markets do hold lessons about governance, but Yarvin draws the wrong conclusions. Democracy, not monarchy, is the political system most analogous to capitalism. As Mises observed, “The market is a democracy in which every penny gives a right to vote.” The analogy works both ways: voting in a democracy mirrors spending in a market. Both systems empower individuals—consumers or voters—to shape outcomes, whether by determining market success or selecting leaders.
Democracy and capitalism are both examples of open-access orders, systems characterized by dispersed power, low barriers to entry, and transparent, universally applicable rules. Such features foster adaptability, accountability, and broad participation—qualities essential to both economic and political success.
The West does face a modest “crisis” of democracy, but the root of this crisis lies in expecting democracy to do too much. We have collectivized decisions which are best left in the hands of individuals and markets but democracy is not a good way of making collective decisions.
Democracy is best understood as a constraint on government power, akin to a Bill of Rights, federalism, and the separation of powers. Democracy’s virtue is in providing a mechanism to remove bad rulers without resorting to bloodshed and its primary value lies in preventing catastrophic outcomes like mass famines and democide—a significant and undeniable merit. Autocracies and monarchies perform much less well on the big issues and, contrary to what many people think, autocracies do not grow faster, win more wars, or perform better on any meaningful comparison that has been investigated.
It is also essential to recognize that “democracy” encompasses a wide range of structures—parliamentary, presidential, constitutional, and more—and there is plenty of room for improved choice within the broader category. We can improve our democracy.
The real lesson from markets is not to create monarchs but to design systems that create choice and competition and allow citizens to remove leaders when they fail.
Hat tip for discussion: Connor.
The 1920s immigration restrictions
The 1920s immigration restrictions in the US did not affect manufacturing wages.
The US immigration restrictions of the 1920s lowered the occupational standings of whites and incumbent immigrants.
US counties with more immigrants excluded by the quotas of the 1920s saw increased in-migration.
During the Great Black Migration of the US, black southerners moved to northern counties, filling roles left by excluded immigrants.
During the Great Black Migration, blacks who migrated to counties with more excluded immigrants experienced greater economic gains.
That is from a new piece by Bin Xie in the Journal of Comparative Economics. Via the excellent Kevin Lewis.
What should AI policy learn from DeepSeek?
That is a Bloomberg column of mine from about two weeks ago. I thought it would make more sense to people if I did not blog it right away. Here is one bit:
Now the world knows that a very high-quality AI system can be trained for a relatively small sum of money. That could bring comparable AI systems into realistic purview for nations such as Russia, Iran, Pakistan and others. It is possible to imagine a foreign billionaire initiating a similar program, although personnel would be a constraint. Whatever the dangers of the Chinese system and its potential uses, DeepSeek-inspired offshoots in other nations could be more worrying yet.
Finding cheaper ways to build AI systems was almost certainly going to happen anyway. But consider the tradeoff here: US policy succeeded in hampering China’s ability to deploy high-quality chips in AI systems, with the accompanying national-security benefits, but it also accelerated the development of effective AI systems that do not rely on the highest-quality chips.
It remains to be seen whether that tradeoff will prove to be a favorable one. Not just in the narrow sense — although there are many questions about DeepSeek’s motives, pricing strategy, plans for the future and its relation to the Chinese government that remain unanswered or unanswerable. The tradeoff is uncertain in a larger sense, too.
To paraphrase the Austrian economist Ludwig Mises: Government interventions have important unintended secondary consequences. To see if a policy will work, it is necessary to consider not only its immediate impact but also its second- and third-order effects.
Travis Fisher on electricity privatization (from my email)
I’m a long-time reader and first-time emailer. I just read your blog post from earlier this month about privatizing public services like water and electric utilities.
My colleague Glen Lyons and I are developing a way to introduce more competition into the electricity sector, which some believe to be hopelessly uncompetitive. The idea is to allow new, large electricity customers to form new electricity networks. The change to state statute would officially introduce contestability into many markets, and we think actual rival networks would be built to satisfy new load. They would probably have to be large, electrically, meaning they would likely need to serve multiple large customers (today you can go off-grid, but only to supply yourself).
We aren’t necessarily trying to revolutionize the existing grid or change the way a typical residential customer receives electric service, although there may be beneficial spillover effects for all customers. And the idea is not brand new (I find myself agreeing with many of Wayne Crews’ views from the late 1990s), but the concept’s technological feasibility is at an all-time high, and the flood of new demand from data centers and new manufacturers is creating the right political environment to enact new policies.
Here is my description of the policy: https://www.cato.org/blog/what-would-consumer-regulated-electricity-look
Plus an interview we did recently: https://secondpower.substack.com/p/wacc
Here is the Cato bio of Travis Fisher.
A Galt’s Gulch for Talent
A new paper in the QJE, The Global Race for Talent: Brain Drain, Knowledge Transfer, and Growth, by Marta Prato uses extensive data on inventors and their migration to make the following points.
(i) gross migration is asymmetric, with brain drain (net emigration) from the EU to the United States; (ii) migrants increase their patenting by 33% a year after migration; (iii) migrants continue working with inventors at origin after moving, although less frequently; (iv) migrants’ productivity gains spill over to their collaborators at origin, who increase patenting by 16% a year when a co-inventor emigrates.
Notice that migration doesn’t just relocate talent from the EU to the US; it amplifies talent. Preventing “brain drain” would create short-term gains for the EU but retaining talent at lower productivity would stifle long-term innovation and patenting, ultimately slowing growth for both the EU and the world. In short, even the EU gains from sending talent to the US! The effect would be much larger if we can import high-skill immigrants from countries where their skills are even less productive than in the EU. Ideally, other nations could replicate the US institutions that supercharge productivity, creating global economic gains. For now, however, the US seem to be a unique Galt’s Gulch for talent.
Prato concludes with a practical suggestion:
On the migration policy side, doubling the size of the U.S. H1B visa program increases U.S. and EU growth by 4% in the long run, because it sorts inventors to where they produce more innovations and knowledge spillovers.
Of course, when we expand the H1B program, we should allocate the visas by compensation rather than by lottery. (Jeremy Neufeld runs the numbers). In this way, we would get the most valuable workers. And please don’t tell me that we need a lottery so some poor startup can hire workers. No. Unless you have some compelling argument for why there is a massive externality and why lotteries (lotteries!) are the best way to target that externality we should let price allocate.
Ross Marchand on postal service privatization (from my email)
I really enjoyed your piece on USPS privatization. I recently wrote about the subject too. Even in the absence of privatization, relaxing the mail monopoly and allowing competition would make for better, more reliable mail services. This is true even in countries with a “national champion”-style carrier subject to a universal service obligation.
It appears that, over the long-run, nations such as Germany and the U.K. that relax their monopolies eventually come around to (at least considering) ending their universal service obligations. The advantage of the “end the monopoly first” approach is it allows countries to experiment with greater competition in a less risky and threatening manner than whole immediate privatization.
Corin Wagen defends Leviticus (from my email)
In your recent conversation with Misha Saul, you and Misha discussed your joint dislike for Leviticus. I can’t say that I find Leviticus a page-turner, but the book that’s done the most to help me understand why it’s important and what role it plays in the movement of the narrative is L Michael Morales’s book Who Shall Ascend The Mountain Of The Lord? (Amazon). A number of folks I’ve talked to have found this book very helpful. (Disclaimer: Morales is a Protestant, as is D. A. Carson (the editor), so the biases are apparent.)
Briefly, his argument is that Leviticus serves to resolve the narrative tension introduced by the ending of Exodus. Exodus 40:34–35: “Then the cloud covered the tent of meeting, and the glory of the Lord filled the tabernacle. And Moses was not able to enter the tent of meeting because the cloud settled on it, and the glory of the Lord filled the tabernacle.” The tension introduced by Genesis 3 is that God and man can no longer co-exist because of sin. Moses is able to ascend Sinai, speak with God, and bring the people his laws, but even after building the tabernacle and the ark, even Moses is unable to reside in the presence of God—let alone the people who cannot even touch Sinai!
The rules of Leviticus presents the conditions to resolve this tension and allow the people access to God—protected by the rules that God gives them. In particular the book has a chiastic structure centered around Leviticus 16 (Yom Kippur) where the high priest himself is able to enter the Holy of Holies. There’s other points about how the structure of the tabernacle and later the temple mirrors Eden, etc. “Interesting throughout,” as they say.