Do They Even Recognize the Trade-Off?

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Here’s yet one more open letter to the current president of the executive branch of the U.S. national government.

August 8, 2026

Mr. Donald J. Trump
President, Executive Branch
United States Government
1600 Pennsylvania Ave., NW
Washington, DC 20500

Mr. Trump:

The Washington Post reports that on Thursday you proceeded to “set a price floor for polysilicon, one of the key components of solar panels and semiconductors, and impose a 15 percent tariff on products made from the material. The goal is to make domestic manufacturers more competitive with inexpensive Chinese importers” (“Solar power is about to get more expensive. Thank Trump.” August 8). The Post also reports that Commerce secretary Howard Lutnick said that “this will bring the supply chain here.”

Apart from the Post’s own sound criticisms of this latest effort of your administration to deny Americans access to low-cost inputs, I have a question: Do you and your advisors ever ask yourselves which ‘supply chains’ America must abandon whenever your tariffs bring some other ‘supply chains’ here?

Mr. Lutnick might be correct that these new tariffs will prompt Americans to produce more polysilicon for the manufacture of solar panels and semiconductors. But whatever additional American workers and capital and other materials your interventions direct into producing more polysilicon in the U.S. are necessarily drawn away from producing other goods and services in the U.S. It’s impossible for tariffs, subsidies, and price ceiling to bring more of some ‘supply chains’ here without simultaneously driving more of other ‘supply chains’ away from here.

Do you know what these other ‘supply chains’ are? Are you confident that the value of increased U.S. production of polysilicon is worth the decreased U.S. production of whatever are the outputs that your interventions prevent from being produced?

Do you even recognize that this inescapable trade-off exists?

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