Campaigns have become quite frustrating for policy wonks, as campaign consultants generally advise candidates from staking out firm policy positions these days.  Policy changes require explaining, and voters don’t seem to have time for that. 

They prefer a steady diet of sound bites and platitudes.  They’re not very filling, but they don’t leave the aftertaste of opponents keying in on the negatives of change 

What is somewhat unique about this election is that both parties seem to be fighting over the populist voters of this country.  These are the voters who fit a vague description of working class Americans who fear prosperity is passing them by. 

Enemies of populists are generally big and beyond their control.  Big tech, big multinational corporations, and big trading partner countries tend to top the lists. 

A panacea for many populists is the implementation of tariffs. These are often seen as job saving measures by those who advocate for them.  They’re seen as barriers to international trade and the net economic benefits it brings to those that oppose them.  They’re often cited as the cause of the great depression as well, though the truth there – like with most global events – is a bit more complicated. 

There’s not a real debate going on between the candidates on tariffs.  The Biden-Harris administration has not only kept most of the tariffs President Trump imposed, but in a fight for Pennsylvania steel mill votes, is even trying to block the acquisition of U.S. Steel by a Japanese owned conglomerate.  Japan, as you might note, is not only one of America’s largest trading partners, but one of our closest military allies.

President Trump isn’t content with his presumed success, and is now talking about broad based tariffs to generate revenue as a replacement for future income tax cuts.  He rejects the notion that the higher costs would be passed on to consumers.  

An actual debate on tariffs would discuss the differences in reasons to apply tariffs, as well as the costs and the benefits of doing so.  Most voters, again, aren’t interested in these details.  They are, however, critically important. 

“Free Trade” is the mantra of those who oppose tariffs.  Anyone who advocates for the elimination of all tariffs needs to be asked if they believe a monopoly – one who can set prices and endure losses longer than their competitors - is a good trading partner.  Presuming the answer is “No” then there’s the basis for at least some tariffs.

Large socialist countries in many ways act as monopolies as trading partners. They subsidize their industries and allow many to operate at losses in order to keep their people employed. 

China, specifically, allows many of their industries to use government supplied utilities for free.  There are no minimum wage laws.  In some cases, such as the Uyghur population, slave labor is part of the mix.  There are no OSHA standards.  Their environmental mandates are a joke.  And when they then want to dump their goods in the United States below their own cost of production, we’re told “free trade” is good for us. 

The reason we don’t let monopolies act like this is that they only operate at losses until they have driven out competition.  They then raise prices and reduce services to maximize their own profit. 

A capitalist system operating at peak capacity demands competition, not one survivor.  The same is true with trade. 

China is currently having huge internal economic issues due to their years long Covid era shutdowns and a domestic real estate crisis similar to what we experienced a couple of decades ago.  To keep their factories humming, they’re dumping many products on the world market. Chief among them are steel and cars.

The European Union just added tariffs to Chinese made cars of up to 36.35%.  They used a model worth considering for tariffs here. 

Companies exporting from China into the E.U. were asked to document the subsidies they received in China for production in exchange for possibly receiving a lower tariff.  Telsa, which receives fewer subsidies than most Chinese owned manufacturers, had its tariff reduced to only 9%.  The point being that the tariff was designed to level the playing field, not just be punitive for the sake of it.

Americans have been supportive of regulations on our domestic producers that have good intentions, but also drive up costs to employers.  When considering tariffs, we need those countries who do not protect their workers or the environment to pay the price via tariff to level this playing field.   If the cost passed along to consumers is too high, then maybe we should consider the true cost-benefit of our own regulatory framework here, too.