The arguments advanced in favor of the tariff regime declared by President Trump’s executive order are weak in the extreme. If imposed by a Democrat president, would we really have a problem in seeing the tariffs as destructive and unlawful (there is no “emergency” on which the tariff regime can properly be predicated).
This 244-word editorial description of the regime from National Review’s The Week accurately states what we have here (despite the administration’s effort to obscure it):
When the Trump administration said it would calculate “reciprocal” tariff rates for every country according to an undefined assortment of “trade barriers” (some of which, such as value-added taxes, are not actually trade barriers), it was creating for itself a nearly impossible task. After two months of complete confusion, it settled on one of the worst possible methods to set tariff rates: It divided the country’s goods-trade deficit with the U.S. by its amount of exports to the U.S. and then divided that in half. For the more than 100 countries with which the U.S. has a trade surplus, it set the tax rate at 10 percent. It’s all based not on tariffs or unfair trade practices but simply on the existence of a trade deficit, and on the dogged belief that trade deficits are bad.
The executive order, based on a nonexistent national emergency, imposes what is likely the largest peacetime tax hike in American history. It puts 17 percent tariffs on Israeli goods even though Israel has had a free-trade deal with the U.S. for 40 years and eliminated its few remaining tariffs earlier this week. There’s nothing “reciprocal” about it, and it taxes goods from our allies Taiwan, Japan, and South Korea at higher rates than it does goods from Venezuela or Iran. Ordinarily the belief that trade deficits are bad is mistaken but harmless. Combining it with a presidential power grab has made it harmful, and American businesses and consumers will pay the price.
I would slightly revise the concluding sentence to characterize the presidential power grab as aggravating the harm of the tariff regime itself.
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