Here’s a letter to the Wall Street Journal:
Editor:
Lamely attempting to defend himself from your sound criticisms of his destructive protectionist policies, Donald Trump inadvertently makes a fool of himself by only further exposing his out-and-out ignorance of economics (Letters, August 31). Specifically, he insists that, despite his tariffs, “price increases for consumers were virtually nonexistent.” Really?! Overlook the fact that this claim is demonstrably false. Focus instead on the reality that, if it were true that his tariffs caused no Americans to pay higher prices, then his tariffs cannot possibly have protected the workers and firms that he asserts were protected by his tariffs.
Tariffs protect domestic workers and firms only by raising the prices that consumers must pay to acquire tariffed goods. Such price increases are the whole point of tariffs. These higher prices are necessary to incite protected firms to ramp-up production and to hire more workers. And so a tariff that does not cause consumers to pay higher prices is one that does not incite domestic firms to increase production and to hire more workers.
If, as Mr. Trump asserts, his tariffs did not raise the prices that Americans pay for the outputs produced by protected industries, then his tariffs did nothing to increase outputs or employment in these industries. In short, his tariffs failed to achieve the goals that he himself trumpets as the goals of his trade policy.
Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030
