President Trump tweeted “Trade wars are good” as part of his offensive against liberty in America. The absence of protest from both Republicans and Democrats is a sure signal that graduates of today’s government schools are oblivious to the role that Smoot-Hawley tariffs (which raised duties on hundreds of imports) played in extending the Great Depression – by an entire decade, some economists say.

Say I have a huge trade deficit with Whole Foods and an even bigger trade deficit with Apple Inc. In this scenario, Trump’s solution would be for me not to buy that iPhone – “don’t trade anymore – we win big,” he tweeted. Trump’s insinuation is that I win big if I keep the $800 in my pocket. Really?!

What many people don’t understand is that when Trump imposes a 25 percent tariff on steel, he is imposing a tax on American citizens. It’s yet another example of Trump’s incognizance of basic economics. “If the Chinese are going to hurt their citizens by forcing them to sell Americans cheap goods,” he seems to be saying, “then I’ll stop that by hurting American citizens in return.”

My trade deficit with Whole Foods is no more a problem for me than America’s trade deficit with China is for Americans. When the president imposes a tariff, Americans pay more for construction, more for washing machines, more for everything they want. Worse than that, tariffs gum up the entire economy – uncertainty infects business, stock prices suffer, unemployment goes back up – and each American pays for that as well.

Ronald Housley


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