Tariffs trigger extensive governmental petitioning by competing groups — a process that’s detrimental to the U.S. economy. Domestic producers eagerly lobby officials for higher tariffs on their particular products, knowing this will allow them to sell more or raise prices without facing overseas competition. But other groups pressure the government in the opposite direction: Consumers and manufacturers want products they normally buy or use as inputs to be exempted from tariffs to avoid higher costs.
These groups could spend substantial time and valuable resources lobbying for tariff increases or exemptions, up to the net present value of all future money these tariffs represent. Crucially, all these resources could be used for something more productive than, say, dining with government officials to secure tariff adjustments. As Tullock observed, “These expenditures, which may simply offset each other to some extent, are purely wasteful from the standpoint of society as a whole; they are spent not in increasing wealth, but in attempts to transfer or resist transfer of wealth.”
Examples of this process are already unfolding. The lobbying sector is experiencing significant growth this year. While few industries will publicly demand higher tariffs on their own products, steel and aluminum producers plainly benefit from protection and have every reason to press for it. Meanwhile, automobile, pharmaceutical, energy, and semiconductor companies are all requesting exceptions for their inputs. Even fireworks retailers, who rely on Chinese imports, are petitioning for exclusions from these tariffs.
Holman Jenkins doesn’t think much of Trump’s erratic trade ‘policy.’ A slice:
The real question is why. Why have this trade war? Why not just enact a consumption or import tax as part of the Big Beautiful Bill?
If one answer is that Mr. Trump wanted a show, the other is that he imagined U.S. law afforded him a show, granting unhindered presidential authority to impose tariffs willy-nilly on the nation’s foreign trade. Get ready for fresh chaos when this legal conceit goes poof in the courts.
If he wanted a show, he also wanted a line outside his White House door of CEOs and lobbyists and foreign leaders pleading for relief. Net result: a meaningful increase in “the swamp.”
This is activity for activity’s sake. If the economy stays good, Mr. Trump will claim credit, never mind that a good economy will have been good despite his trade turmoil. If it falters, get ready for more acts like firing the government’s chief labor-market statistician followed by a new Trump-emceed drama when Democrats reclaim the House and fire up the impeachment machinery.
Peter Earle dives with learning and good judgment into the revisions in the Bureau of Labor Statistics jobs numbers that ignited the Trump fuse that fired the BLS commissioner. Here’s his conclusion:
In short, while the 258,000 revision in July 2025 is undeniably large, it is not an aberration in the true statistical sense. It is an emphatic example of a structural feature of the data — and a call for caution in applying oversimplified models to complex empirical realities. Ironically, casting statistically unusual or politically inconvenient data as conspiratorial will only serve to undermine trust in future releases, rendering them more — not less — politically charged.
Last week’s dismal labor market report sent shock waves through U.S. markets. In “Trump Claims the Jobs Report Was Rigged. Was It?” (Life Science, Aug. 4), Allysia Finley describes how President Trump accused the Bureau of Labor Statistics of publishing “rigged” numbers and fired its well-respected commissioner, Erika McEntarfer.
The bureau reported that only 73,000 nonfarm jobs were added in July, well below expectations. It also revised May and June numbers, erasing a combined 258,000 jobs from earlier employment estimates—the biggest downward revision since the pandemic.
Rather than search for economic explanations, the president’s response was to punish the messenger.
The true source of slow job growth is widespread uncertainty as companies are whiplashed by Mr. Trump’s tariff policies. Meanwhile, the large revisions are partly the result of steep budget and staffing cuts the BLS suffered earlier this year. The 2026 budget proposes cutting staff another 8%, from 2,175 to 1,999 full-time-equivalent employees.
Cuts have consequences. Official U.S. unemployment and inflation data are under threat. Going forward, markets should expect greater errors and revisions as the bureau is forced to shrink sample sizes, conduct more limited surveys and issue less frequent updates.
The greater danger lies in bureau employees being afraid to report accurate figures after witnessing the firing of their commissioner.
Politicians spin — it is what they do. But when their spin undermines the integrity of the numbers we have come to rely on, the consequences are real. We will all pay the price.
Until now, we’ve filled our labor shortage with foreign workers, though not without challenges. Still, they show up every Sunday to keep the plants alive and load Monday morning’s deliveries.
