This week, President Donald Trump announced yet another trade deal, this time with Japan. As reported by Reason Magazine, “Under the terms outlined by Trump in a Truth Social post on Tuesday, imports from Japan will be subject to a 15 percent tariff when they enter the United States.”
“They had their top people here, and we worked on it long and hard. And it’s a great deal for everybody,” Trump said on Tuesday.
Is it?
Americans imported nearly $150 billion in goods from Japan last year, with the World Bank estimating the average tariff on imports of Japanese goods being about 2%. A 2% tax.
Under Trump’s supposed “great deal,” this will now be 15%.
As one can easily determine through basic mathematics, this is a significant increase from the average tariff previously paid by Americans importing goods from Japan.
Indeed, this follows a pattern from the president in making international trade more expensive for American consumers.
His previously announced deal with Vietnam effectively doubled the taxes paid by Americans importing goods from the Southeast Asian nation to 20%.
It is indeed peculiar how silent Republicans are about all of this. Once the party that pushed back on taxes out of reflex, the GOP has stood by as the president of the United States unilaterally imposes taxes on American businesses and consumers.
One can only imagine the uproar if President Barack Obama did this, the condemnations of abuse of power and complaints of “Socialism!”
But no, not now that the GOP has fallen to populist gibberish about trade deficits and nostalgia for Midwestern factory jobs that will never come back.
As the great Milton Friedman once said, “We call a tariff a protective measure. It does protect; it protects the consumer very well against one thing. It protects the consumer against low prices.”
That indeed is what President Donald Trump is protecting Americans from. Americans reeling from the inflation of the last five years will get no relief from his relentless desire to tax goods from abroad.
As President Ronald Reagan explained in 1988, “We too often talk about trade while using the vocabulary of war. In war, for one side to win, the other must lose. But commerce is not warfare. Trade is an economic alliance that benefits both countries. There are no losers, only winners. And trade helps strengthen the free world.”
It is this legacy and this insight that the Trump administration and its supporters are disregarding. Unfortunately, we see no signs of this populist poison easing anytime soon.
