Tariffs Raise Prices, Spark Conflicts, and Make Everyone Poorer
Back when conservatives championed ideas rather than outsourced their thinking to their leader, they touted a simple saying: “Ideas have consequences.” Conservatives also understood that while people should always be free to make their own choices based on those ideas, they should be responsible for the consequences of their decisions.
By all means, follow the advice of that YouTube quack who argues that vaccines include microchips that control the population. But when your kid is hospitalized with measles, that’s on you. Unfortunately, in a democratic society, the population must endure the brunt of ludicrous ideas imposed by elected officials. (Check out my columns about the awful ones in California.)
We’re now at the “good and hard” part of H.L. Mencken’s definition about democracy being “the theory that the common people know what they want and deserve to get it.” That’s certainly the case with economic policy. If you occasionally check your retirement accounts and did so after the last two times President Donald Trump imposed 25-percent tariffs on Canada and Mexico, you will have noticed that they dropped precipitously.
The markets understand the basic truth about tariffs, which are taxes consumers in our country pay for imported goods. They raise prices, reduce our access to foreign goods and spark reciprocal tariffs that then punish our country’s farmers and manufacturers. They lead to less growth and more unemployment. They increase bureaucracy by requiring officials to calculate duties and enforce them. They create hostilities and have led to actual war.
As economist Robert Higgs explains, “Fiscally, protectionism is a poor source of government revenue that dries up completely as tariffs are increased so much that they reduce trade flows to zero. Morally, protectionism is vicious because it coercively substitutes the ill-informed and ill-directed judgment of government officials for the judgment of people making deals with their own private property.”
Given MAGA is an emotional movement based on resentment rather than a precise set of policy ideas, it’s no surprise the president’s ardent supporters dodge and weave alongside his ever-changing justifications. Our nation has some serious disputes with Mexico involving immigration and drug smuggling, so I’ll focus instead on our government’s juvenile trade war with Canada.
Trump threatened them to gain ill-defined concessions from our friendly, highly developed and peaceful allies to the north. Then, after it was clear Canada had already conceded to whatever it was our president demanded, he suspended them. His supporters claimed tariff critics didn’t understand that this was just a brilliant negotiating tool. But then this month the president imposed them anyway. True to form, MAGA shifted back to arguing that tariffs are great policy in and of themselves.
Some of the more unusual MAGA folks don’t
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