Eric Boehm exposes Marco Rubio’s hypocrisy on trade policy. A slice:
Other studies found similar results. Here’s one authored by economists at the Federal Reserve, Princeton University, and Columbia University that found Trump’s tariffs cost U.S. consumers $3 billion per month. Here’s a study by economists at the University of Chicago that found Trump’s tariffs on washing machines hiked consumer costs by more than $1.5 billion. A study from Moody’s Investor Service that found American consumers paid roughly 93 percent of the tariff costs. Other studies have come to similar conclusions.
In his American Conservative essay, Rubio tellingly doesn’t attempt to offer evidence to contradict these well-established facts. Instead, he flippantly declares that the “‘experts’ got it wrong” and adds that “economists simplistically declare ‘The policy is very bad. Tariffs make consumers poorer. They shrink the economy.'”
Perhaps the economists say those things because they are true and because the past six years have confirmed as much. It’s fine to be skeptical of experts, but Rubio is the one making simplistic declarations here.
And if tariffs were the solution to anything, wouldn’t there be evidence to support that claim by now? Rubio is engaging in a rhetorical trick more commonly used by progressives by suggesting that the lack of evidence in favor of a government policy isn’t indicative of failure but only means that it hasn’t been tried hard enough. Conservatives used to roll their eyes at that tactic.
Perhaps Rubio will parlay all these mental gymnastics and pro-Trump sycophancy into a vice presidential nomination or some other plum gig. For now, however, he’s provided a perfectly pathetic illustration of the current state of the Republican Party, which has abandoned principle and reality to swoon for Trump’s silly notions about what makes countries prosperous.
Wall Street Journal columnist Holman Jenkins warns of the dangers of a trade war. Three slices:
Mr. Trump’s economic thoughts were honed in encounters with Rona Barrett, Liz Smith and “Access Hollywood.” The only press that paid attention to him when he was coming up was the gossip press and it shows. Mr. Biden is no better. He’s hardly been a non-Trump when it comes to dispensing trade-distorting import restrictions and subsidies, witness his expected proposal next week to quadruple duties on imported Chinese electric vehicles.
When protectionism is out of the bag globally, when subsidies are being doled out to domestic industries, it whets the appetite of congressmen and lobbyists for more. Look out, world economy.
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This isn’t the 1930s but the risk goes up when nations are under internal stress. Don’t let the “realists” kid you about Vladimir Putin’s Ukraine war. Its origins are domestic: He wanted an excuse to militarize Russian society and suppress internal opposition amid the long-term economic stagnation he knows he won’t be able to solve in his declining years.
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In the small favors department, any Trump trade folly at least could hardly be as gratuitous as the folly Mr. Biden seems determined to commit. Mr. Biden shows every sign of wanting to start a global trade war to protect the high-cost, uncompetitive green-energy industry he’s been building at home with taxpayer dollars.
This green subsidy program, as any economist will tell you, will nonetheless have exactly zero effect on emissions and climate change.
When President Obama tried this, I wrote that the dumbest trade war is a green one. It hasn’t gotten any less dumb.
GMU Econ alum Paul Mueller writes that the “climate ‘reparations’ numbers are rigged.” A slice:
To keep things simple, let’s assume that the value of one life-year is $200,000. The $500 billion number proposed by [Esther] Duflo suggests that the cost imposed by wealthy countries burning fossil fuels is the loss of roughly 2.5 million life-year” in poor countries per year.
That sounds like a staggering number!
But what about the benefits that have accrued to developing countries from activities that generate CO2 emissions? Important advances in medicine, such as antibiotics and vaccines, were developed in modern industrialized countries. So, too, were refrigeration, cars, the internet, smart phones, radar; modern agricultural methods with herbicides, pesticides, and fertilizers; improvements in plumbing, building materials, manufacturing, and much more. “Polluting” activities in industrialized countries improved nutrition and safety around the world. These advances, and many others, significantly increased people’s life expectancies — especially in poor countries.
Surely the value of these improvements should weight the opposite side of the scale from the expected harm of climate change — especially since the crusade against fossil fuels and carbon emissions will assuredly slow economic growth and innovation.
George Will is no fan of the imperial presidency. Three slices:
What the nation will most need from the presidency in 2025 is less of it. But both the incumbent and his predecessor intend to intensify the anti-constitutional executive aggrandizement that has become a bipartisan tradition.
It preceded Donald Trump, whose presidential lawlessness was, like him, haphazard and opportunistic. Joe Biden’s presidency-without-limits has been ideological and perversely principled. Progressives, such as he has become late in life, are impatient with institutional impediments (Congress and courts) to progress, meaning their policy preferences achieved by unfettered presidential actions.
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The urgent issue that is entirely missing from the 2024 debate is explained by University of Virginia law professor Saikrishna Prakash’s 2020 book “The Living Presidency: An Originalist Argument Against Its Ever-Expanding Powers.” Without constitutional amendment or even proper public debate, the presidency has, by small but cumulatively transforming steps, become “more royal and powerful and less executive and duty-bound,” Prakash wrote. Because of this “creeping constitutional coup,” the presidency “has no enduring limits, no permanent frontiers.”
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Domestically, note Biden’s ongoing violations of the Constitution’s appropriations clause by spending, without congressional authorization, $153 billion so far by forgiveness of student loans. Biden’s immediate predecessor “repurposed,” for building his border wall, money authorized for something else. And during the 2008-2009 financial crisis, when Congress provided only for the bailout of financial institutions, George W. Bush simply acted as though General Motors and Chrysler were financial institutions.
Arnold Kling describes “the status-driven syndrome.”
As a matter of economics, failing to note monetary policy’s role in inflation is incoherent. Pandemic-driven supply shocks and global energy price spikes undoubtedly increased prices by constraining the economy’s productive capacity. Had the central bank not pursued monetary accommodation, however, such forces would have caused a short, transitory inflation burst that ultimately would have receded. Instead, consumer prices remain 11 percent above where they’d be expected to be if annual inflation had stuck at 2 percent post-2019.
My new edited volume, The War on Prices: How Popular Misconceptions about Inflation, Prices, and Value Create Bad Policy, catalogues politicians’ faulty theories about inflation’s causes. Scholars Pierre Lemieux, Bryan Cutsinger, Brian Albrecht, David Beckworth, and Stan Veuger document that inflation wasn’t the product of greedy corporations, aggressive wage demands, or even primarily supply-shocks and bottlenecks. The best explanation was overly stimulatory macroeconomic policy.
