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George Will strongly, and rightly, criticizes today’s lapdog GOP Congress. Two slices:

The Democrats’ House and Senate minorities have no power — the ability to achieve intended effects. The Republican majorities have no power because they are not permitted intention independent of this president’s preferences.

He refuses to enforce the law that strictly required the TikTok app to be sold or banned, at the latest, by April. He believes Congress’s spending power is merely the power to suggest spending ceilings. Try to cite a long-standing tenet of conservatism he has not traduced. Federalism? To end voting by mail and impose voter identification requirements, he would truncate, by executive order, the states’ constitutionally enumerated power to conduct elections. He would commandeer state and local governments with an executive order banning no-cash bail. Free markets? See “state capitalism,” below.

The Constitution’s architecture presupposes legislative and executive powers not merely separated but somewhat rivalrous. “Ambition,” wrote James Madison, “must be made to counteract ambition.” The architecture collapses when, as today, the controlling ambition of most members of the congressional majorities is reelection requiring sycophancy toward today’s president. Individual and institutional pride have vanished, supplanted by unapologetic and undignified fear.

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Presidents are mistakenly accorded vast discretion in foreign policy, so Congress can do little when today’s president, for no discernible strategic reason, uses insults and economic coercion to propel the most populous nation, India, into closer collaboration with the second-most populous, China.

Congress could, however, inhibit this administration’s primary domestic policy.

It is frequently, and illogically, described as “state capitalism,” an oxymoron coined to avoid candidly calling it “socialism”: government supplanting markets in the allocation of capital and, hence, of opportunity. Many business leaders in what should now be called “the quasi-private sector” have responded to presidential bullying with groveling.

Intel, for example, has given the government a 10 percent interest in it. This dilutes the value of other shareholders’ portions of the company — an unconstitutional, because uncompensated, taking of property.

Writing at The American Spectator, GMU Econ alum Dave Hebert makes clear that “tariffs have created the monster we fear.” Two slices:

Where I had previously warned that our tariffs were driving friends away, the latest developments show that now we’re uniting our enemies into a formidable economic trade bloc that could reshape global trade patterns for decades in a decidedly anti-American way. While Trump might want to put “America First,” it is becoming increasingly clear that the rest of the world is trying to put “America Last.”

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But are we doing more things ourselves? The evidence is starting to come in, and the only defensible answer is a resounding “no.” The latest BLS reports suggest that times are tough for manufacturing in the United States. While job openings continue to rise in manufacturing, this is almost entirely driven by the increased rate at which people are quitting their manufacturing jobs.

Lest we rely on statistics from the BLS, we can look at local newspapers to get a more granular picture of what’s going on. In Michigan alone, manufacturing plants are closing left, right, and center, and established firms, like Ford, General Motors, and Stellantis, have incurred losses in the billions of dollars in just the first six months of 2025 alone — enough to hire another 88,000 workers. Even Alcoa, the aluminum-producing firm, is experiencing massive losses thanks to tariffs, and the US Steel situation was so dire that they had to be sold to Nippon Steel on the condition that President Trump receive a “golden share” of the company.

Kenneth Griffin and Anil Kashyap warn of “Trump’s risky game with the Fed.” A slice:

The U.S. benefits from strong economic fundamentals, yet it faces two challenges: an unsustainable fiscal trajectory and unacceptably high inflation. Elevated long-term interest rates reflect growing market doubts about the stability of inflation and the sustainability of public finances. Without resolution, the government will pay more to finance deficits, young families will struggle to afford homes, and companies will invest less.

Runaway inflation during the Biden administration cost the Democrats in the 2024 elections. Rightfully, President Trump and his administration have made controlling inflation a priority. Lower inflation should naturally produce lower interest rates. But statements and actions that undermine the independence of the Fed risk stoking both higher inflation and higher long-term rates. The president’s strategy of publicly criticizing the Fed, suggesting the dismissal of governors, and pressuring the central bank to adopt a more permissive stance toward inflation carries steep costs. These actions raise inflation expectations, increase market risk premiums, and weaken investor confidence in U.S. institutions.

Mr. Trump’s interventions and his dismissal of the head of the Bureau of Labor Statistics have damaged the credibility of official economic data. Together, these developments highlight risks that recall experiences in emerging markets where political influence eroded institutional credibility. While the U.S. benefits from a large stock of credibility accumulated over decades, it isn’t limitless. If eroded, markets will demand far higher interest rates for longer-term debt.

Harassing, and hostility toward, foreigners is no way to attract foreign investment. (HT Scott Lincicome)

The National Rifle Association takes a correct, principled stand against the Trump administration’s assault on the 2nd amendment.

GMU Econ alum Bryan Cutsinger reviews George Selgin’s brilliant new book, False Dawn. Here’s his conclusion:

One of the book’s many strengths is Selgin’s evenhanded approach. This is no polemic. He readily credits the Roosevelt administration’s successes—recognizing the policies that aided recovery—and engages seriously with scholarship that challenges his account. Rather than dismiss opposing views, he addresses them directly and thoughtfully, making his case all the more persuasive for its fairness. False Dawn is a remarkable contribution that will undoubtedly stand as the authoritative account of the New Deal for years to come.

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… is from page 113 of Historical Impromptus, a 2020 collection of some of Deirdre McCloskey’s work on economic history; this quotation, specifically, is from McCloskey’s Spring 2001 review, in The American Scholar, of Niall Ferguson’s The Cash Nexus:

Britain, the first industrial nation and the champion of free trade, went from $1,800 in per capita income in 1820 to $3,300 in 1870, the figure nearly doubling despite a population explosion – and during the half-century in which the European avant garde, with Marx and Engels, turned against free markets.

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September 7, 2025

Mr. Scott Bessent
Secretary, U.S. Treasury
Washington, DC

Mr. Bessent:

This morning on “Meet the Press” you confidently claimed that Pres. Trump’s tariffs are sparking a manufacturing revival in the U.S. Minutes later, and with equal confidence, you claimed that these tariffs are not causing, and will not cause, Americans to pay higher prices. Companies, you assert, are ‘eating’ the tariffs by not passing along their costs to consumers in the form of higher prices.

Let’s here ignore the fact that the data contradict both of your claims (a reality that you evade by insisting that the data aren’t “good”). Instead, let’s examine the internal (in)consistency of your argument.

If – as Mr. Trump and protectionists have long asserted – U.S. manufacturing has been “hollowed out” by unfair trade, the only way that tariffs can increase U.S. manufacturing output is to raise the prices paid by American consumers in order to enable American manufacturers to raise their own prices to ‘fair’ levels that allow them profitably to increase their outputs. But if, as you also insist, the tariffs aren’t raising the prices paid by American consumers, American manufacturers face the same prices that prevailed before the tariffs. With no tariff-induced hike in prices, American manufacturers will not increase their outputs.

Either the tariffs do raise prices paid by American consumers, thus allowing some American manufacturers to profitably increase their outputs, or the tariffs don’t raise prices paid by American consumers, thus providing no opportunity for American manufacturers to profitably increase their outputs.

Which is it? It must be one or the other; it cannot be both.

This point isn’t one of ideology, politics, or ‘elite’ opinion. It’s a point of simple logic that not even a successful politician or investment banker can escape. You inadvertently insult Americans’ intelligence by insisting on the truth of both of your claims.

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

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Here’s a follow-up note to a correspondent who describes himself as a “recovering free trader.”

Mr. H__:

Thanks for your reply to my last note.

You write: “When other countries reduce their imports from us it injures our economy and President Trump is fully justified in trying to stop them from injuring us like this.”

I disagree. First, even if your argument were correct, it doesn’t describe the actual pattern of Trump’s willy-nilly tariffs.

Second and more fundamentally, your argument is fraught with pitfalls. It’s true that some U.S. producers lose sales because of other countries’ tariffs, and these lost sales can shrink the scale of these producers’ operations, causing their per-unit costs of production to be higher than these costs would be absent the foreign tariffs. But what reason have you to suppose that the benefits that we’d reap tomorrow if our tariffs eventually pressure foreigners to lower their tariffs would be greater than the costs we incur today to exert this pressure? Do you trust politicians to have such knowledge?

Further, as Adam Smith warned, it’s unlikely that there is much overlap of those of us who would pay the bulk of the costs of our government’s retaliation with those of us who would reap the benefits of this retaliation. What ethical principle justifies the U.S. government picking your pocket with tariffs, however temporary, in order to swell my pocket with increased export sales?

Finally, what’s the limiting principle of this too-convenient justification for protective tariffs? Foreign tariffs are not the only source of reduced U.S. exports. Another source, for example, is the fact that foreigners in many countries don’t work on weekends and holidays. Should our government, therefore, impose tariffs on such countries until and unless their governments mandate that all adults in those countries work 365 days each year? Such a mandate, after all, might very well increase our exports.

Foreigners aren’t ethically or economically obliged to buy our stuff. It follows that we are not ethically or economically justified in attempting to force them to buy our stuff – especially when such attempts involve using force to prevent our fellow citizens from spending their incomes in whatever peaceful ways they think best.

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

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Sen. Rand Paul (R-KY) rightly calls out J.D. Vance for glorifying government slaughter of people not convicted of any crime: (HT Phil Magness)

Vance says killing people he accuses of a crime is the “highest and best use of the military.”

Did he ever read To Kill a Mockingbird?

Did he ever wonder what might happen if the accused were immediately executed without trial or representation??

What a despicable and thoughtless sentiment it is to glorify killing someone without a trial.

Kathleen Parker calls on Trump to press China’s authoritarian government to release the heroic Jimmy Lai. A slice:

Lai lost his freedom, his now-shuttered newspaper and much of his fortune for protesting China’s crackdown on Hong Kong and for defending democracy and human rights. He was charged with two counts of conspiracy to collude with foreign forces and one count of collusion under Hong Kong’s relatively recent national security law for publishing pro-democracy views. He also was charged with sedition under a law passed when Hong Kong was still under British rule that originally was used to silence critics of colonialism.

Fareed Zakaria explains that Trump’s tariffs are strengthening foreign alliances against the United States. Three slices:

What was surprising were the images from the days before, when the Shanghai Cooperation Organization hosted leaders from India, Turkey, Vietnam and Egypt, among others. All these regional powers were generally considered closer to Washington than Beijing. But a toxic combination of tariffs, hostile rhetoric and ideological demands is moving many of the world’s pivotal states away from the United States and toward China. It might be the greatest own goal in modern foreign policy.

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The governments and people in these countries are outraged at their treatment. India used to be overwhelmingly pro-American. Now it is rapidly shifting toward a deep suspicion of Washington. In Brazil, President Luiz Inácio Lula da Silva’s sagging poll numbers have risen as he stands up to Trump’s bullying. In South Africa, President Cyril Ramaphosa gained stature when he politely responded to Trump’s Oval Office hectoring. It is worth remembering that other countries have nationalist sentiment, too!

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While Washington has been alienating these countries, China has been courting them. It has outlined a plan with Brazil for a transformative railway network connecting its Atlantic coast to Peru’s Pacific one. Xi managed to get Indian Prime Minister Narendra Modi to visit China for the first time in seven years. China has courted South Africa with trade and aid, and public sentiment in that country has moved to be quite favorably inclined toward Beijing.

Pierre Lemieux continues to write wisely about trade and industrial policy. A slice:

In passing, let’s note that in the roaring ’60s, it was popular among the ruling establishments of underdeveloped countries, supported by the Western intelligentsia, to impose large tariffs on foreign manufactured goods in order to help domestic manufacturing. Only when, a few decades later, it was realized that such an industrial policy was a fool’s errand, were the poor people of underdeveloped countries able to jump on the bandwagon of free trade and to escape dire poverty.

A basic economic reason why “unfairly traded steel” or the underlying ideal of mercantilist and industrial policy is a fool’s errand is that it presupposes a central economic planner possessing what he does not and cannot possess, that is, the information of time, place, costs, and preferences that is carried by prices determined by supply and demand on free markets. Friedrich Hayek explained that in the 1930s and 1940s (see Hayek’s American Economic Review article “The Use of Knowledge in Society”). A central planner cannot even know many intricate effects of his resource-allocation decisions, especially in a complex economy. Thus, government intervention begets government intervention in the greatest political disorder. That the US government only realized after imposing steel tariffs that they should be imposed on steel products too provides a rather funny illustration.

Another important lesson from protectionism—empirically confirmed a thousand times—is how rent-seeking special interests will try to exploit the general public, or part of it, each time the state offers them a means to do so. The requests for tariffs on steel-containing products are already flooding the government.

Alex Cole tweets: (HT Scott Lincicome)

64% of Arkansas farmers voted for Trump, at the present rate because of tariffs, one third of them will be bankrupt by this time next year. Their solution? They want money from the government. So again, it’s not socialism when I get money, just when everybody else gets it…

Brian Albrecht asks if tariffs will cause an outbreak of “greedflation.”

Here’s David Henderson on GMU Econ alum Romina Boccia’s and her co-author’s, Ivane Nachkebia, new book titled Reimagining Social Security: Global Lessons for Retirement Policy Changes.

Reason‘s Nick Gillespie talks with Richard Dawkins about science.

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… is from page 96 of the late Christopher Hitchens’s October 9, 2008, Vanity Fair essay titled “America the Banana Republic,” as this essay is reprinted in Arguably, the 2011 collection of several of Hitchens’s essays:

How very agreeable it must be to sit at a table in a casino where nobody seems to lose, and to play with a big stack of chips furnished to you by other people, and to have the further assurance that, if anything should ever chance to go wrong, you yourself are guaranteed by the tax dollars of those whose money you are throwing about in the first place! It’s enough to make a cat laugh.

DBx: Hitchens here wrote about the cronyism that was uncorked by the subprime crisis, but his words apply with equal relevance and force to the cronyism now being further uncorked by Trump’s protectionism. Trump is playing with other people’s money – specifically, the money of his fellow Americans. What fun for him! Anything that goes wrong – and much will indeed go wrong – Trump’s personal fortune will be unaffected and he’ll blame others. And members of his base, despite being made poorer by him, will bask in the fantastically false belief that he’s saving them from economic predators.

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Here’s a letter to a new correspondent.

Mr. H__:

Last week you wrote to criticize me for allegedly “being unaware of the case for retaliatory tariffs made by Adam Smith.” (I responded that I’m not unaware of Smith’s case.) Today you write to praise what you describe as Pres. Trump’s “efficacious use of tariffs to drive more investment to the USA.”

With respect, your argument is internally inconsistent, and not only because Trump continues to be blind to the fact that increased global investment in the U.S. fattens his bête noire: U.S. trade deficits.

Although Adam Smith doubted that politicians can be trusted to use retaliatory tariffs in economically productive ways, he acknowledged the theoretical possibility that tariffs imposed at home in response to foreign tariffs might serve the cause of economic efficiency if they pressure foreign governments to eliminate their tariffs. Importantly, Smith recognized that retaliatory tariffs are useful and justified only insofar as they, by lowering trade barriers, improve the allocation of capital, labor, and other resources across countries by leaving that allocation to be carried out by market forces.

Trump, however, uses tariffs to achieve exactly what Smith argued well-designed retaliatory tariffs might prevent – namely, resource misallocation caused by protectionism. Smith wanted capital, labor, and other resources to be allocated by market forces; Trump wants capital, labor, and other resources to be allocated by Trump.

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

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Phil Magness reminds us that among the most rabid of the covidians were many of today’s leading MAGA-ites. Three slices:

Resistance to the COVID-era lockdowns occupies a central place in the political identity of the New Right—the eclectic group of national conservatives, postliberals, populists, and neoreactionaries at the ideological core of the MAGA coalition. Ironically, it was President Donald Trump who enabled lockdowns by proclaiming a national emergency in March 2020 and appointed Anthony Fauci to lead his administration’s pandemic response efforts. And yet the New Right has opted to look past these contradictions.

It has become routine for New Right political figures to position themselves as leaders of a bold resistance against the COVID restrictions—vice president and self-described postliberal J.D. Vance launched his Senate campaign in 2021 with an attack on “Fauci’s cabal”—even as they were largely absent as these events unfolded in 2020.

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[Auron] MacIntyre is a devout [Curtis] Yarvin enthusiast, but with a peculiar twist. At the time of MacIntyre’s claimed COVID awakening in April 2020, Yarvin was busy preaching the necessity of Wuhan-style lockdowns, electronic exposure tracking, and other authoritarian measures to halt the coronavirus in America.

Yarvin’s counter-pandemic “plan” ventured into extremes that even the most fanatical lockdowners avoided stating openly. “Americans all have [cell] phones,” he wrote. “Why haven’t we started full population control—with involuntary tracking, testing, and isolation—yesterday?”

He mocked lockdowns in his home state of California for being insufficiently aggressive to accomplish the task of virus control, ridiculed Americans as too “puerile, spoiled and arrogant” to meet the challenge of COVID, and faulted our free economy and democratic institutions for creating obstacles to imposing a China-esque virus control plan. Yarvin’s proposed interventions read like a would-be dictator’s fever dream.

He called for the creation of a “Coronavirus Authority” with “unconditional and unlimited authority over all public and private actors,” operating beyond the reach of Congress and unaccountable to any court review or constitutional oversight. To blunt the economic disruption of such draconian measures, Yarvin proposed that the Federal Reserve convert all private stock and bond holdings into public assets in exchange for a one-time payment. In this new financial reordering, “The Fed owns all public companies” for the duration of the pandemic, with any debt being incurred by the Fed and then canceled. This temporary dictatorship (or as Yarvin put it, “literally the state capitalism of the Soviet Union”) would run for the course of the pandemic before resetting society after the lockdowns worked—an outcome in which Yarvin had supreme confidence.

As for anyone who complained, Yarvin’s plan called for complete social ostracism and suppression. “In a sane world, anyone with a public record of minimizing the coronavirus would be cancelled—unfit for any further employment, let alone in this crisis.” He wanted people to fear even “being linked to a coronavirus minimizer.”

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Today, New Right figures rail against Fauci and the United States’ pandemic response policies that they embraced or acquiesced to in 2020. But they remain suspiciously silent about the lockdown records of other governments they support. The New Right, and postliberals in particular, often extol the government of Viktor Orbán in Hungary as a model for conservative governance. Orbán imposed harsh lockdowns in 2020, far exceeding the restrictions in the United States. Another New Right hero, President Nayib Bukele of El Salvador, imposed one of the strictest lockdown regimes in Central America and repeatedly defied court orders that challenged his rule by emergency decree. Bukele’s subsequent takeover of his country’s judiciary and accompanying prison system are, in part, direct byproducts of his COVID-era restrictions.

As with much of America, genuine fear over an unknown pandemic likely motivated the New Right toward lockdowns and other forms of alarm at the outbreak of the pandemic. Before he turned against lockdowns in the late spring of 2020, [Tucker] Carlson personally lobbied Trump to take more aggressive action in his COVID response. Other, more opportunistic motives also played a role though, as New Right figures tried to appropriate the pandemic response to pet issues such as countering free trade and immigration.

[DBx: On social media, someone – mistakenly supposing himself to score points against this piece by Phil Magness – accused Magness of being a member of the “anti-tariff wing of MAGA.” This accusation is akin to accusing someone of being in the anti-abortion wing of Planned Parenthood or in the anti-government-schooling wing of the National Education Association. Such a wing is not a thing. Furthermore, anyone remotely familiar with Magness’s work would know that he is emphatically not MAGA. He’s quite the opposite.]

Gage Klipper reviews a new movie about covid.

Eric Boehm is correct: “Trump promised that protectionism and immigration enforcement would be good for the economy. The latest jobs report tells a different story.”

Also correct is Noah Rothman: “You can’t eat record ‘tariff revenues’.” A slice:

Lutnick was right; July’s disappointing numbers grew from the initial 73,000 new jobs to today’s 79,000. But at the same time, the BLS adjusted June’s numbers downward, finding that the U.S. lost 13,000 jobs that month — the first month of employment contraction in the United States since the height of the pandemic. June’s ugly figures mirror May’s ugly figures, when just 19,000 new jobs were created. If the president and his advisers want to take the BLS’s good June, they’ll have to acknowledge the legitimacy of its bad August, July, and May.

All told, the BLS’s reports over the past four months indicate that the American job market hit a wall in April — an impact that coincided with the inauguration of the great trade war. It’s a sharp decline from the six months that preceded May, each of which showed the U.S. creating more than 100,000 jobs per month.

Soon enough, the sluggish job market combined with the growing sense that high and rising prices are a feature of the Trump economy will present this administration with growing political challenges. If the White House’s only answer to those challenges is to bedazzle you with the amount of money that, but for the tariff regime, would still be in your bank account, they’ll discover that the public’s tolerance for the administration’s many other flights of fancy has limits.

The Wall Street Journal‘s Editorial Board reflects on yesterday’s dismal jobs report. Two slices:

President Trump fired the Bureau of Labor Statistics commissioner last month because he didn’t like the monthly jobs numbers. He claimed the numbers were “rigged.” But Friday’s monthly report for August confirms that job creation has stalled amid his tariff barrage.

Employers added a mere 22,000 jobs last month while the numbers were revised down for the previous two by a combined 21,000. This means only 107,000 new jobs were created in the last four months—an average of 27,000. Monthly job gains averaged 167,000 last year.

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What Mr. Trump needs is a broad revival in business confidence of the kind that accompanied his November victory and appeared before his tax on imports and willy-nilly interventions in private business decisions. Repeat after us: Tariffs are taxes, and taxes hurt economic growth.

Mr. Trump this week asked the Supreme Court to hear the legal challenge to his tariffs on a fast track. The best news for the economy would be if the Court takes up his challenge and finds them unconstitutional.

Jennifer Huddleston explains “what the Google antitrust remedies ruling means for antitrust, consumers, and innovation.”