Former President Donald Trump has proposed massive trade tariffs if he’s elected. Kamala Harris has equated the idea with a massive national sales tax, which isn’t very wrong. Nearly every economist has dismissed his “concept of a plan” as somewhere between silly and dangerous. The near unanimity is a huge part of the problem.
We must begin with two admissions. First, tariffs will reduce our collective wealth. Every trade barrier makes some things more expensive. And that reduction in buying power will affect most those who spend most of their earnings on the daily stuff of life.
Second, Trump has not shown aptitude toward details and nuance. So the most likely scenario if he wins will be a broad tariff on countries he doesn’t like, or maybe every country without exception. This will create a chaos that will itself be a drag on our (and everyone else’s) economy. A worldwide depression would not be unlikely.
Given such substantial downsides, why even entertain the idea? Because voters will be entertaining the idea this fall. But also, on a related point, because Trump has demonstrated an uncanny ability to recognize a popular fear and to capitalize on it electorally. He’s a savant at recognizing a Zeitgeist before others.
Liberals love their Farmers Markets. They’d rather buy their food locally, even though imported vegetables are cheaper. Trading frugality for familiarity is not a foreign concept. We feel a greater measure of control when there are fewer middlemen in a transaction, even if it costs a little more.
When we buy our limes from Chile, how do we know we’re not supporting child labor and ecological disaster? We don’t. We do know that the lime that is 10 cents cheaper traveled a thousand miles to get to our grocery store. Buying local eliminates that danger. That factor matters more to liberals.
Trade efficiency has produced a remarkable surge in our standard of living. Can we afford to give some of that buying power back to our neighbors? Manufacturing and agricultural jobs give workers more satisfaction because they are making something tangible. Service jobs or anything in the legal or financial sectors will always be more abstract — and so, for many, less satisfying.
Deaths by despair have skyrocketed along the same lines as our increased buying power. Having more money is sometimes not worth it. Retraining machinists to become accountants sounded good in the 1980s, but we know now that doesn’t work for everyone. If AI is poised to accelerate our productivity improvements, now might be the perfect time to consider shortening and simplifying supply chains.
Multinational corporations have grown so much more than our wallets since NAFTA and other free trade agreements. Several corporations are now wealthier and more powerful than most nations on the planet. That’s not the world most liberals would prefer to live in.
The upheaval that would follow inevitable trade wars would be substantial, but temporary. United States consumers will benefit in the long run because manufacturing jobs will return (albeit slowly) if that was the only way to avoid the tariffs. If anything, our economy here would begin to look more European, where the VAT tax funds most government operations. Imagine conservatives when they discover they’ve created a society that functions more like Europe!
Finally, Israel has demonstrated a new danger behind impossibly complex supply chains. Any link in the chain could invite surveillance or explosives or sabotage. Keeping every step of manufacturing closer to home is more expensive, but less dangerous. Those trade-offs are very real, all of a sudden.
Two final points, which are not economic so much as political (in the broadest sense.) Why have Democrats gone silent on the case to be made for tariffs? Bernie Sanders has certainly made the case for workers’ rights and “Buy American.” More broadly, why have Democrats ceded the issue so completely to Republicans? Consensus among elites does not instill confidence as much as suspicion.
Lastly, the populist rhetoric has not quite crystallized around this sweeping solution. No crowd response has emerged that resembles “Build the Wall!” (even though trade sanctions are essentially walls.) Once Trump identifies a call-and-response that resonates with people, he adds an absurdist flourish at the end, to make it his own.
Making Mexico pay for the wall, sending Hillary or Biden to prison, debating Biden “anytime, anywhere,” ending a protracted war on his first day in office — he needs to tell his followers that he “alone can fix it” and it will be easy for him. He hasn’t found a rhetorical flourish to drive home his tariff plan. That might be because he knows it could make liberals happier than he would like.
Tags: No Comments
0 responses so far ↓
There are no comments yet...Kick things off by filling out the form below.