Here’s a letter to the Wall Street Journal.
Editor:
Brandon Farris’s defense of steel tariffs is defective (Letters, July 16). He cites a 2023 U.S. International Trade Commission study, but that study analyzed the 25% tariff then in effect, not the 50% rate imposed since then. It cannot vouch for today’s tariffs
The study also undercuts, rather than supports, Mr. Farris’s argument. Prices of final goods did rise only modestly. But the report found near-complete pass-through: foreign exporters barely cut their prices. American importers and the manufacturers and consumers downstream of them — not foreigners, as the administration claims — bore almost the entire cost.
The Commission found that “for downstream industries, the effects are largely negative…. The average annual decrease in production values for these industries was $3.4 billion during 2018–21.” Even so, the report calls its own findings incomplete, as it “focuses on short-term effects during 2018–21 and does not address long-term effects,” omitting consequences such as the drag on U.S. exporters from foreign retaliation, which it notes occurred but are not measured. Significantly, yet ignored by Mr. Farris, the report adds that it “is not an assessment of the complete, economy-wide impacts of the tariffs.”
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
