While imposing tariffs on nearly every nation earlier this month, President Donald Trump called tariffs the dictionary’s “most beautiful word.” He said they will make Americans “rich” and “restructure the economy for the better.”
He later announced a 90-day freeze on most tariffs to allow for negotiations.
Tariffs are a destructive tax on consumers that increase prices while inhibiting competition. Their only positive use might be leverage to negotiate removal of all tariffs and trade barriers between America and countries wishing to trade with us. If that occurs, we could achieve the dictionary’s truly “most beautiful word” — freedom.
However, if the tariffs remain, they will not make Americans rich.
“Over the past 200 years,” then-President Ronald Reagan explained in a 1988 radio address, “not only has the argument against tariffs and trade barriers won nearly universal agreement among economists, but it has also proven itself in the real world, where we have seen free-trading nations prosper while protectionist countries fall behind.”
“When Congress ed the Smoot-Hawley tariff in 1930, we were told that it would protect America from foreign competition and save jobs in this country — the same line we hear today. The actual result was the Great Depression, the worst economic catastrophe in our history; one out of four Americans were thrown out of work. …”
“Ever since that time, the American people have stayed true to our heritage by rejecting the siren song of protectionism.”
“In recent years, the trade deficit led some misguided politicians to call for protectionism, warning that otherwise we would lose jobs. But they were wrong again. In fact, the United States not only didn’t lose jobs, we created more jobs than all the countries of Western Europe, Canada and Japan combined. …”
“We should beware of [those] who are ready to declare a trade war against our friends — weakening our economy, our national security, and the entire free world — all while cynically waving the American flag. The expansion of the international economy is not a foreign invasion; it is an American triumph, one we worked hard to achieve, and something central to our vision of a peaceful and prosperous world of freedom.”
Among the stated purposes of Trump’s tariffs is to bring manufacturing back to the Midwest, something that would likely require far more than tariffs or trade deals. Manufacturing left the U.S. largely due to high production costs and the nation’s pivot to becoming the world’s leading service industry, whether it be tourism or technology. Tariffs have rarely, if ever, been cited by experts as a cause or solution.
If the goal is a rebirth of manufacturing, there needs to be more, perhaps tax incentives and development of robotics and other innovations. And American industry would need government stability in decision-making in order to plan and encourage investment.
It also needs some assurance of available labor. According to February’s Job Openings and Labor Turnover Survey, there were 482,000 unfilled manufacturing jobs. The Manufacturing Institute estimated last year that figure will grow to 1.9 million by 2033.
The current erratic tariff decision-making has shaken the economy while denying industry the stability needed for investment decisions. That is not the way our nation should make policy decisions.
Under our representative democracy, taxes should never be imposed by one person, even the president. There should be a deliberative process with a proposed plan that is debated before action is taken.
The Constitution grants Congress power to approve taxes, such as tariffs, subject to presidential veto. Over the years, Congress delegated that power to the president, a power President Trump is using to unilaterally impose widespread tariffs through executive orders without public debate or congressional approval.
Last year, Sen. Rand Paul, R-Kentucky, introduced legislation to require the president to obtain congressional approval before imposing a tariff. “Unchecked executive actions enacting tariffs tax our citizens, threaten our economy, raise prices for everyday goods, and erode the system of checks and balances that our founders so carefully crafted,” he explained.
Congress should adopt Sen. Paul’s legislation.
In the meantime, President Trump should negotiate to seek removal of all tariffs between America and countries wishing to trade with us.
We should always stand for freedom, including free and fair trade.
Goldsmith, now retired, is the former San Diego city attorney. He lives in San Diego.
