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| Arthur Laffer and Steve Forbes |
In a Wall Street Journal op-ed by Steve Forbes, Arthur Laffer, Fred Smith, and Stephen Moore titled, Mr. President, It’s Time for Zero Tariffs, the authors provide all kinds of cover for Trump to do just the opposite and put tariffs on.
As Donald J. Boudreaux correctly observes:
[T]hey err in advising that U.S. tariffs be cut to zero only on condition that other governments cut their tariffs to zero. Instead, the U.S. should do what Hong Kong has done, to its enormous benefit, for most of the past century, and what it continues to do: carry out a policy of free trade unconditionally and unilaterally.
Because in economics the only justifications for protectionism are so narrow and recondite as to have no real-world applicability – and because in ethics the justifications for protectionism are completely nonexistent – there is no reason why we Americans must wait for other governments to stop imposing artificial scarcities upon their citizens before our government stops imposing artificial scarcities upon us.-RW
Let's address this from another direction: Moore, Forbes and Laffer have this nagging suspicion that DJT had NO intention ever of lowering tariffs EVEN IF other governments drop theirs to zero and that his talk about being a free trade guy is a lie.
ReplyDeleteTwo days ago, Pete Navarro appeared in Fox Business Network's Bulls & Bears, where he was questioned by private fund manager Jonathan Hoenig about his "change of heart" about free trade from the time he published a book extolling trade, and now. Navarro argued that the book was written in 1984 to which Hoenig asked "what changed?"
"What changed? Well, American jobs shipped to overseas, the WTO happened, globalism happened". After that Navarro was irate and insulted Hoebig (yes, the guy is a gentleman) so the obviius follow-up question wasn't asked: what makes you think those things, even if they were true, wouldn't go on happening after the presumed end-game is reached of zero tariffs across all borders and thus in reality the president has NO intention of getting rid of the tariffs?
It's clear and obvious that the tariffs are not a "bargaining tool" but the policy the president wanted to impose from the beginning. He is an old-fashioned protectionist, not a free-trader.