Spencer P. Morrison destroys Jonah Goldberg and Ben Shapiro about the need for big, beautiful tariffs (read more from Morrison here):
Jonah Goldberg writes that President Trump supports tariffs because he is “truly ignorant of some of the most basic” economic principles—or he is “deceiving the public” to push a hidden agenda.
Let’s not mince words: Goldberg’s implication is that Trump is either stupid or evil for promoting tariffs.
Goldberg is not alone. Economists like Steve Hankeo routinely accuse Trump of economic illiteracy. Meanwhile, sophists such as Ben Shapiro assert that tariffs are fundamentally immoral—Shapiro once accused me of favoring “total state control of the economy” like the mass murderer/hair-care aficionado Joseph Stalin. For what crime? Wanting fair, reciprocal trade with China.
Since the “free trade brigade” tolerates charges of ignorance, let’s look at what is truly ignorant. Just how ignorant? Buckle up.
Worshipping Mephistopheles
Goldberg begins with the claim that trade deficits don’t matter. After all, “I have a trade deficit with my cigar shop, barber shop, supermarket and liquor store. They get my money and I get goods and services in return.” Win-win.The same is true of international trade: China gets our money, America gets their goods. Furthermore, the money we pay to China eventually returns to us, since American money must be spent on American stuff. In reality, there is no such thing as a deficit, just a balance of payments.
This analogy is duplicitous.
America does not run a trade deficit with just China. We run a global trade deficit. Returning to Goldberg’s analogy: this would be akin to having a deficit with the cigar shop, barber shop, supermarket, and liquor store, while at the same time being unemployed.
Now imagine this situation persisting for 60 years.
How would Goldberg pay for his cigars and liquor? He would either need to sell his prized collection of old National Review articles (assets) or max-out his shiny new credit cards (debt). In either case, Goldberg eventually would run out of money and need to reduce his consumption—or increase his income.
Read more: American Greatness
Image credit: www.amgreatness.com.
