Hysteria has erupted here and abroad over President Trump’s threats to level trade tariffs against particular countries.
Both American and foreign critics blasted them variously as either counterproductive and suicidal or unfair, imperialistic, and xenophobic.
Certainly, tariffs are widely hated by doctrinaire economists. They complain that tariffs burden consumers with higher prices to protect weak domestic industries that, shielded from competition, will have no incentive to improve efficiency.
Their ideal is “free” trade. Supposedly a free global market alone should adjudicate which particular industry in any country can produce the greatest good for the world’s consumers, whether defined by lower prices or better quality, or both.
Even when “free trade” becomes “unfair trade”—such as China’s massive mercantile surpluses—many neoliberal economists still insist that even subsidized foreign imports are beneficial.
Cheap imports, Americans were told, supposedly still lowered prices for consumers, still forced domestic producers to economize to remain competitive, and still brought “creative destruction,” as inefficient domestic industries properly gave way to more efficient, market-driven ones.
But many exporters to the U.S. are propped up by their own governments.
They may seem more competitive only because their governments want to dump products at a loss to capture market share, subsidize their businesses’ overhead to protect domestic employment or seek to create a monopoly over a strategic industry.
Yet when Trump threatened to level tariffs against Mexico, Canada, Colombia, Venezuela, China, or the European Union, they were not primarily aimed at propping up particular inefficient U.S. industries at all.
Instead, an exasperated Trump threatened Mexico with tariffs for three reasons.
It refused to address its cartels’ illegal multibillion-dollar export of lethal fentanyl into the United States.
The cartels buy Chinese-supplied raw fentanyl with impunity, disguise it to resemble toxic drugs, and smuggle the product across a porous border.
The result over the last decade is more dead Americans from fentanyl than the total number of all U.S. soldiers lost in the wars of the twentieth century.
Second, Mexico had stonewalled all American efforts to stop their export of millions of illegal aliens into the United States—10-12 million in the last four years alone.
Mexico adds insult to injury by raking in profits from some $63 billion in remittances sent from its former resident citizens now residing in the United States and often subsidized by American taxpayers.
Third, Mexico grows its American trade surpluses each year. The imbalance is now a mind-boggling nearly $170 billion.
Trump threatened Canada because it has so far refused to police its side of an open and increasingly dangerous border. And it has racked up a $50 billion surplus by leveling asymmetrical tariffs on lots of U.S. products.
Canada also has refused to keep its NATO promises to spend 2 percent of its GDP on defense.
Canada’s pathetic 1.37 percent expenditure is predicated on American magnanimity. The U.S. alone protects Canada under the American North American nuclear shield and subsidizes NATO deadbeats like Canada by funding some 16 percent of the budget of the 32-nation alliance, as well as policing the international seas.
As for Venezuela and Colombia, both communist nations have deliberately emptied their prisons to send hundreds of thousands of illegal aliens into the U.S.—many of them violent felons. They do so either out of crass self-interest, hatred, or a strategic desire to weaken America.
China is a special case.
Its entire 20th-century ascendance was based on stealing U.S. technology, dumping its products on the U.S. market below the cost of production to capture market share, and forcing American corporations to relocate, offshore, and outsource—leaving our industrial hinterland a “rustbelt.”
The European Union runs a gargantuan half-trillion-dollar surplus with the U.S.
How?
Because for nearly the last 80 years, the U.S. has subsidized its defense during the Cold War and afterwards.
Europe acts as if it is recovering from World War II, so it can hit up a supposedly limitlessly rich American patron with asymmetrical tariffs.
Consider the various Trump “tariffs” leveled by an exasperated, and now $36 trillion-indebted, America.
Almost none of them meet the traditional definitions of an industry-protecting tariff.
Instead, they are the last-gasp tools of American leverage used only when decades of bipartisan diplomacy, summits, entreaties, and empty threats have all failed.
So, Trump is not a mercantilist.
Instead, he is trying to stop the multimillion-person influx of foreign criminals, the crashing of the border by millions of illegal aliens, the cartels’ export of American-killing drugs, the violation of past trade agreements, and allies from using America to subsidize their own defense.
The Trump tariffs are the last, desperate effort to reestablish global reciprocity and keep America safe.
And our “shocked” friends, allies, and enemies privately have known that all too well.
Anyone who claims, at this point, to be shocked and/or appalled by PDJT’s tariffs is either not paying attention or is indulging in performative responses for click bait. The tariffs have always been a negotiation tool, aimed at achieving specific results or serving as a reminder that the other party’s bad faith behavior has not gone unnoticed.
The word “tariff” is being used, in a traditional pejorative sense, just the way the word “vaccine” has often been used in a traditional positive way. People might want to consider how we currently view the later, based on the recent pandemic, before they accept the former, based, not on traditional economics but on a new way to deal with damage control.
America’s Marxist leaders have allowed America’s enemies to do indirectly what they could not do directly while hiding under an easily seen pseudo camouflage of rationality and/or compassion. It could not have been more evidently displayed than by the reasoning provided by Chuck, the Marxist, Schumer, the other day, when he explained that a tariff on items produced by Mexico would result in a retaliation which would create an increase in the price of Corona beer and avocados. Most Americas immediately figured out that the senator suddenly seemed more like representative AOC than they ever previously might have realized because they could not imagine how anyone, other than AOC, could not understand that the trivial trade off would likely save thousands of American lives from overdosing on poisonous drugs and halt the invasion of illegal migrants through America’s southern border. Dittos for America’s northern border and any tariffs imposed on Canada to achieve the same objectives.
The take on Donald Trump’s use of tariffs is obvious to most. What is not so obvious is that Democrats, at least to themselves, have made it obvious to a new, and much more suspicious public, that they no longer have the edge, they used to enjoy, using sophistry, lies and damn lies.
Good points, task. Let’s be honest-- none of the shock, outrage or doomsday predictions are real; all of it is performative and based on the outdated assumption that they have any credibility left. They sincerely don’t seem to realize that their days of controlling narratives are over.
Trump’s tariffs are a long-overdue correction to what amounts to the world’s abusive relationship with the US. Trading nations have used the cover of the supposed hegemon receiving poetic justice for its sins of hegemony even as it demanded, connived, and stole market access as reparations. It says a great deal about classical economics that its champions would not be upset by this arrangement and be so blind to the consequences. Taking control of this parasitical relationship is akin to the old saw that ‘the law is too important to be left to judges and lawyers.’ Besides being grotesquely unfair, it helps the criminal regime that controls China act out its hegemonistic fantasies that so much of the world has turned a blind eye to. China’s behavior makes its dependency grotesque, giving the lesser parasites cover to make their version palatable. Trump will fix the world’s dependency on the US because it can’t continue this way. Other nations should be aware that it has finally dawned on Americans what it means for three hundred and thirty million to be propping up the world economy thirty-five years after the end of the Cold War. It looks like more than a travesty; it makes the rest of the world look like it isn’t worth saving.