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GMU Econ alum Dominic Pino identifies some of the “non-tariff costs of Trump’s reckless tariff policy.” Two slices:

It is true that people aren’t actually paying tariffs for buying stuff from Mexico or Canada. But that’s not the only cost to consider. The big one that’s relevant here is policy uncertainty.

One purpose of deals such as the United States-Mexico-Canada Agreement (USMCA) or any of the other trade agreements the U.S. has with other countries is to provide some certainty to U.S. and foreign companies looking to do international business with the U.S. That includes companies from the countries that are party to the agreement and those from other countries around the world. Japanese, German, and South Korean automakers, for example, make business decisions under the assumption that the North American market has low trade barriers between Mexico, the U.S., and Canada.

Some of the most attractive things about investing in the United States are that it has secure property rights and the rule of law. Among really big countries with a large consumer base, it’s really the only game in town. So it’s no wonder that people from just about every other country want to sell stuff here, which is another way of saying they want to invest here, since the dollars we send them for their stuff come back as investment in America.

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There are also geopolitical costs. In the future, if the U.S. wants to strike a new trade agreement with another country, decision-makers in that country are not going to forget about this episode. If the president who negotiated the USMCA and said it was “the largest, most significant, modern, and balanced trade agreement in history” is willing to completely ignore it to threaten blanket tariffs on America’s neighbors, no country should be totally confident that the U.S. will honor its trade agreements.

Then there are the constitutional costs. If the constraints on the president’s tariff powers are truly as weak as the Trump administration believes they are, giving him nearly total authority to unilaterally tax every import from entire countries, that’s a bad sign for checks and balances. If the results of Trump’s antics are seen as a political “win,” they will encourage future presidents to continue to push the envelope on “emergency” powers. I called out Joe Biden for his abuses on this front, and I’d be dishonest to not do the same for Trump. Congress needs to severely curtail “emergency” powers, which are increasingly used for things that aren’t emergencies at all.

Also wisely warning of the destructive uncertainty unleashed by Trump’s tariff spasms is the Editorial Board of the Wall Street Journal. A slice:

None of this means the tariffs are some genius power play, as the Trump media chorus is boasting. The 25% border tax could return in a month if Mr. Trump is in the wrong mood, or if he doesn’t like something the foreign leaders have said or done. It also isn’t clear what Mr. Trump really wants his tariffs to achieve. Are they about reducing the flow of fentanyl, or is his real goal to rewrite the North American trade deal he signed in his first term? If it’s the latter, there’s more political volatility ahead.

Mr. Trump’s weekend tariff broadside against a pair of neighbors has opened a new era of economic policy uncertainty that won’t calm down until the President does. As we warned many times before Election Day, this is the biggest economic risk of Donald Trump’s second term.

Will tariffs lower prices?

Jacob Sullum explains “how Trump can falsely claim his tariff threats helped win the drug war.” A slice:

It seems President Donald Trump’s plan to fight drugs with punitive tariffs on China, Mexico, and Canada, which never made much sense, was little more than an attempt to look tough. Trump threw his weight around, and now he can claim victory after extracting concessions that will have no meaningful impact on the problem he claims to be addressing.

John Tierney describes the U.S. air-traffic control systems as “an international disgrace.” A slice:

The problems were obvious 20 years ago, when I visited control towers in both Canada and the United States. The Canadians sat in front of sleek computer screens that instantly handled tasks like transferring the oversight of a plane from one controller to another. The Americans were still using pieces of paper called flight strips. After a plane took off, the controller in charge of the local airspace had to carry that plane’s flight strip over to the desk of the controller overseeing the regional airspace. It felt like going back in time from a modern newsroom into a scene from The Front Page.

It was bad enough to see such outdated technology in 2005. But they’re still using those paper flight strips in American towers, and the Federal Aviation Administration’s modernization plans have been delayed so many times that the strips aren’t due to be phased out until 2032. The rest of the system is similarly archaic. The U.S. is way behind Europe in using satellites to guide and monitor planes, forcing pilots and controllers to rely on much less precise readings from radio beacons and ground-based radar.

Overseas controllers use high-resolution cameras and infrared sensors to monitor planes on runways, but many American controllers still have to look out the window—which is why a FedEx cargo plane almost landed on top of another plane two years ago in Austin, Texas. It was a foggy morning, and the controller couldn’t see that a Southwest airliner was on the same runway waiting to take off. At the last minute, the FedEx pilot aborted the landing, missing the other plane by less than 100 feet.

The basic problem, which reformers have been trying to remedy since the Clinton administration, is that the system is operated by a cumbersome federal bureaucracy—the same bureaucracy that’s also responsible for overseeing air safety. The FAA is supposed to be a watchdog, but we’ve put it in charge of watching itself.

George Will is justifiably angered by the effort in Congress to raise the amount of state and local taxes that are allowed to be taken as deductions in federal taxes. A slice:

But the proposed tax “relief” will benefit those mayors and governors, making it politically easier for them to raise taxes. Per the Wall Street Journal’s calculations, for every $1,000 the state and local taxes are raised on a voter in the top tax bracket, he or she gets $370 back from the federal government.

Since enactment of the 2017 tax changes, at least half the states (most under Republican control) have cut their income taxes, thereby further diminishing the benefits their residents get from the SALT deduction. So, raising the SALT cap would further reduce the incentive for conservative policies.

Increasing the SALT cap will increase the deficit, putting downward pressure on defense spending. Nicholas Eberstadt and Patrick Norrick of the American Enterprise Institute note that almost every year for the past two decades, deficits have been larger than defense spending. And defense spending last exceeded social spending during Richard M. Nixon’s first term. Under Jimmy Carter, the cost of social programs was twice the cost of defense. By Bill Clinton’s second term, the ratio was nearly 4 to 1. Today it is 5 to 1.

[DBx: Just fyi, if the SALT cap is raised, I will personally benefit, as the amount of state and local taxes that are extracted from me each year by the State of Virginia and Fairfax County, VA, is well above $10,000. Eliminating, or even just raising, the SALT cap will thus put more money into my pocket. Hooray for me. Yet I nevertheless strongly oppose raising this cap; indeed, I’d prefer to see SALT deductions eliminated altogether. There’s no more reason why the federal tax code should treat the costs that I incur to ‘consume’ goods and services supplied to me by state and local governments differently from how it treats the costs that I incur to consume the goods and services that are supplied to me by private businesses.]

Andrew Stuttaford rightly decries some higher-ups in the GOP – including Trump – supporting Bernie Sanders’s economically ignorant effort to cap credit-card fees.

And Dominic Pino recommends that Trump actually read Thomas Sowell.