by Lew Rockwell, Lew Rockwell:
President Trump said a couple of weeks ago that he would impose punitive tariffs on Mexican and Canadian exports to the United States. The main reason for this was that these countries did not do enough to stop illegal immigrants from entering our country. But this problem can be handled by better border control. There is no need for tariffs, which hurt American consumers, as we will explain below. Fortunately, he has suspended putting these tariffs into effect for one month, but who knows what he will do after that? He has also imposed steep tariffs on Chinese exports, and these have not been suspended
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President Trump is a strong believer in protective tariffs. He sees tariffs as a way to build up American industry. When Donald Trump imposed tariffs on foreign goods, promising to “bring back American jobs,” the political world buzzed with anticipation. Yet, as the economic consequences of these policies unfold, it becomes clear that Trump’s tariffs are no more than a misguided attempt to solve problems that the free market can handle on its own. Far from promoting prosperity, these tariffs represent a step backward, increasing costs for consumers, distorting markets, and expanding government power.
At its core, the logic of tariffs rests on the assumption that by taxing imports, the government can artificially boost domestic production. Trump’s rhetoric revolves around saving American jobs, particularly in industries like steel and aluminum. But this view fails to recognize the fundamental economic principle that tariffs hurt consumers and disrupt the natural flow of trade. When tariffs are imposed, they do not create wealth. They simply reallocate resources in a manner that benefits politically connected industries while harming the rest of the economy. Those same workers that the tariffs aim to help will end up paying higher prices for everyday goods, from electronics to food. The lower-income families—those that Trump claims to champion—will bear the brunt of these price hikes, undermining any supposed benefit from saving a few steel jobs.
Moreover, the idea that protectionist measures like tariffs lead to increased employment is a fallacy. In fact, they often result in net job losses. Tariffs disrupt the global supply chain and lead to inefficiencies that harm businesses across the board. American companies that rely on imported goods face higher input costs, which reduces their competitiveness and leads to layoffs or downsizing. By raising the price of steel and aluminum, Trump’s tariffs hurt American industries that use these materials, including manufacturing, construction, and automotive sectors. These jobs, which are crucial to the broader economy, could be at risk—not to mention the international trade disputes that often follow, further threatening American employment.
Another argument often made in favor of tariffs is the need to protect national security. Trump has used this excuse to justify tariffs on everything from Chinese electronics to European wine. But this claim is a thinly veiled attempt to justify protectionism under the guise of safeguarding American interests. National security should never be used as a pretext to interfere with free trade. In a truly free society, the market is the best mechanism for determining what goods are necessary for the country’s welfare. Governments that intervene based on vague notions of “security” risk distorting the economy for political gain, and Trump’s tariff policies are a prime example of this overreach.
What is truly disturbing about Trump’s tariff strategy, however, is the fundamental disregard for individual liberty and the free-market principles that should guide economic policy. By imposing tariffs, the government is directly intervening in private market decisions. Businesses should have the right to choose the best suppliers, and consumers should be free to purchase the goods they desire at the lowest price. Government interference in the form of tariffs violates the very essence of a free society, where individuals make decisions based on their own preferences and needs. Instead, Trump’s tariffs impose a bureaucratic barrier that limits choices and forces individuals to pay higher prices for inferior goods.
As the great nineteenth-century French economist Frederic Bastiat noted in a satirical article, tariffs are a “negative railroad”: “I have said that as long as one has regard, as unfortunately happens, only to the interest of the producer, it is impossible to avoid running counter to the general interest, since the producer, as such, demands nothing but the multiplication of obstacles, wants, and efforts.
