Here’s another letter to my long-time protectionist foe.
Mr. McKinney:
You’re unhappy with my Facebook criticism of Trump’s ridiculous assertion that the so-called ‘U.S. trade deficit’ with Canada means that Americans are financing Canadians’ consumption. Specifically, you reject my point that, if Canadians were to create a U.S. trade deficit with Canada by giving us, as gifts, billions of dollars of automobiles, aluminum, whiskey, and other goods, that the result would be Canadians paying for our consumption rather than, as Trump believes, Americans paying for Canadians’ consumption.
You conclude that I “neglect the businesses and jobs like the ones in car production destroyed by such ‘gifts’…. Such ‘gifts’ are a trojan horse to weaken our economy while Canada’s is bolstered.”
I can’t fathom how Canadians would enrich themselves and weaken us by spending their own labor and other resources to produce things, not for their consumption, but for our consumption. If your protectionist logic is correct, antebellum slavery enriched the slaves as it weakened plantation owners (with, amazingly, the plantation owners never realizing the terrible economic trickery inflicted on them by their slaves).
But if your (il)logic is correct, your embrace of protectionism is far too lame. You should, in addition to supporting tariffs on cars imported from abroad, also support tariffs on cars imported from the past. After all, Americans’ ready access to cars imported from the past reduces Americans’ demand for new cars no less than does Americans’ ready access to cars imported from abroad
So how about an escalating tax on cars as they age? For example, owners of one-year-old cars are taxed $1,000; owners of two-year-old cars are taxed $2,000; owners of three-year-old cars are taxed $4,000; and so on. These taxes would be tariffs on cars imported from the past. They will penalize those Americans who unpatriotically refuse to support the U.S. auto industry. Or as Oren Cass would put it, these tariffs on cars imported from the past would internalize on Americans who drive older vehicles the costs they thoughtlessly impose on the U.S. auto industry and its workers.
Would you approve of taxing cars imported from the past? If not, why do you approve of taxing cars and other goods imported from abroad? You’ll insist that there’s an economic difference between importing goods from abroad and importing goods from the past, but I challenge you to identify any such difference that is economically relevant. I’m all ears.’
Sincerely,
Don
