by Gene Berkman, IPR
President Donald Trump has announced tariffs on solar panels, washing machines, steel, and aluminum. Shortly after announcing his tariffs, Trump tweeted that “Trade wars are good, and easy to win.”
The opposite is true. Trade wars are harmful across the board, and the cost of these tariffs will be paid in higher prices, lost jobs, and a slower-growing economy. If the trade wars of the 1930s are repeated, Americans could pay by suffering through another Great Depression.
“Trade wars may be good for shoring up Trump’s shrinking populist voter base,” said Libertarian Executive Director Wes Benedict. “But every combatant in a trade war loses, just like in a shooting war — and trade wars often lead to shooting wars. Perhaps the most dishonest component of this newly initiated trade war is its transparently deceptive pretext. Trump justified the tariffs by citing Section 232 of the Trade Expansion Act of 1962, arguing that a depleted domestic steel and aluminum industry could handicap the United States in times of military conflict.”
Defense Secretary Jim Mattis advocated for a tariff that targeted only adversaries, but instead the new tariff takes a shotgun approach that damages both allies and adversaries indiscriminately...To read more, click here.