Tariffs are paid by the country they are imposed on which is much lower than the fallacy of the 'tax' that is paid here.
Trump tariffed foreign steel and aluminum in 2018, by early 2021 both prices were down 24%.
All other countries have effectively tariffed us for the last 80 years and it needs to end. Some could call it the Marshall Plan on steroids and Trump is smart enough to know our lunch needs to be saved.
I can see your empathy for the federal workers. But most of these people are mooches just like some of the politicians that have never worked in the private sector. They have sucked off the tit of the government their whole lives. Go to the post office when there are ten people in line and one clerk at the counter when you can see the others standing around doing nothing. They could probably get rid of half of the federal workers and it would run better and more efficient.
Not all. My grandfather was a scientist with the USFS his whole career. If they would have eliminated his job at 45, not sure what he would have done. Would there have been a job at a lumber company or not? Pure speculation.
Get your point about government bureaucrats in DC and the USPS. Privatize the USPS.
I can see your point about you grandfather. Where would he have gone. But time were different then compared to today. People actually worked compared to today.
I tried to get a USFS or BLM job in the ’80s. They told me straight to my face multiple times that I didn’t have a chance because I was a white male. One guy suggested I go back for another 4 years of college and study computers; so I was among the early cohort of Americans told “Learn to code”. Ask me how much empathy I have for federal employees.
My grandfather retired in 1972. He was very upset at what happened to the USFS with regard to how they changed fire management and the way they viewed things. He was proud of what he had done. His generation was the first wave through. Over 45, it's going to be tough. Under 45...learn to code.
A lot of the old guard USFS were WWII vets who went to college on the GI bill. They were amazing and it’s a shame affirmative action destroyed what they built. Also amazing is that most of America’s trails and campgrounds, even now, were built by the CCC guys during the depression.
Although I have doubts, my gut says he is doing the right thing and it will turn out to be a positive. I tend to see the dark cloud not the silver lining, he is the opposite, a risk taker. Hoping for the best! Thanks for your insight on this, Jeff.
How many times have we seen Democrats go, "aha! we got him doing something stupid! Look at the stupido that you elected!" It's all over the WSJ right now in the comments.
But then how many times do we see him pull a rabbit out of the hat, and everyone says, "Oh. I didn't see that one coming. He was right after all!"
I'm not saying this one will go that way, but to discount Trump's plans so early in the game is a fool's errand. He's making a move on the chess board, and we will get something for it.
The truth is that I trust that he has our best interests at heart, and he's earned the right to see it through. I'm not going to listen to the shrieking and wailing of the short-termers.
Members of the newly created “Department of Government Efficiency” under Elon Musk have engaged in an ongoing campaign designed to cripple the basic functions of government and decimate the federal civil service. Members of the Department of Government Efficiency are reportedly pushing for full access to payment systems and intend to scrape data from within the Department of Treasury. Cloud Software Group CEO Tom Krause has been designated liaison between the Treasury and the Department of Government Efficiency, with Musk reportedly wanting to add the Treasury to the blockchain. Agents from the Department of Government Efficiency have demanded access to classified info with USAID, with Elon later calling the agency a criminal organization and declaring “Time for [USAID] to die”. Civil servants across the federal government have been offered buy-outs to leave their positions early. Not only have no funds been appropriated for these offers (nor has the full legality been determined), but these buy-outs are being made by an administration lead by someone who has notoriously scammed contractors and avoided paying invoices whenever possible. These actions are taking place in the midst of an ongoing purge of high-ranking officials within the FBI by the Trump administration.
Make no mistake, what’s happening right now is a hostile takeover of the federal government by a private agency operating with a broad mandate and no concerns for the stability of the United States or the interests of the average American. It’s easier to break than it is to build, and Elon Musk’s agenda is focused on unraveling America’s governing institutions. When – not if – a preventable disaster is enabled by the Department of Government Efficiency’s decision to destroy a function of government in the name of “fighting wokeness”, there will be a reckoning for the damage Elon Musk has done.
this is not at all a comment that is accurate nor logical. If anything, private NGOs were actually running the government and we are going to see them eliminated
Musk mentioned on X that there are "payment authorization" officials whose sole job is to review payments the system generates and approve them.
They have never declined one payment in the history of this system or their careers.
And, there are organizations that are listed as "terror sponsors" receiving checks, because everything is essentially on auto-pay.
I completely welcome Musk flipping the system inside out and getting control of it. It is clearly being used for all kinds of slush funds, nefarious purposes and Democrat NGO's that do not have our nation's best interests at heart.
Oh, you mean like the Treasury Department that was told to never turn down a payment even to terrorist organizations? Yes, we have written, documented and verified evidence of that and the condescendingly arrogant jerk off who ran that department refused his boss's request for the passwords and instead just resigned in disgrace, so members of DOGE simply walked in the building(because most of the employees were working from home anyway and weren't present), changed everyone's password and within a day they had the computer passwords they needed.
Our exporters all are hit with tariffs in other countries, and other countries produce goods, subsidized by their governments who get their funds from our government and the tariffs we pay!
It’s not close to fair now.
Typical Trump, start the negotiating very high and stroke a deal in the middle.
Trump is thinking in several dimensions: border security, protection of domestic producers and opening up markets for our companies here-
Politicians are very hesitant to being so bombastic. They look for common ground and dance around issues, and reach compromises that are mediocre at best.
Trump uses the stick more than the carrot, and he’s better terms, but makes him less popular.
Trump doesn’t care about being popular, that’s the Achilles heal of our politicians.
There will be uncertainty for a little while, that’s a non positive for markets, but I wouldn’t be selling just because Trump is firing his first salvos.
I disagree with one point. Politicians are all bombastic, especially on issues they think they can push! : ). One point you make that might not be totally grasped is the fact that the negotiation isn't about tariffs, but borders, protectionism, etc. As Marc Andreessen said, "Trump is a "systems guy"." He understands how all the parts fit together.
In the negotiation, why would Trump dismantle the internal American system that offers up similar protectionism to American companies without the others dismantling theirs?
I want to see it all dismantled. American Export-Import bank, subsides etc.
If nothing else, Trump got the economically illiterate Democrats to declare that tariffs may have some downsides for the American consumer. That only has taken 100 years or so for the buffoons in the Democrat party to take notice that someone has to pay for governments messing around with markets.
who just made 100 million in insider profits by knowing who would announce tariffs on Saturday? Who would know what Trump would say? Who would buy 50000 puts on Friday for $50 that will be $2000 tomorrow. or $250,000 will be $100 million DID you get the note? did you invest $50 to make $2000. Someone knew what Trump would say? ask who?
Call me crazy but weren't you saying Trump was unelectable fairly recently? I disagree with you now and I disagreed with you then. Either way I really enjoy your writing.
I was wrong. It was, like the two other past elections still generally pretty close. If the Dems were smart and not anti-Semitic, putting Shapiro in the VP slot probably wins them the election. I don't like tariffs at all. Think Trump is putting the cart before the horse. But, 95% of the commentary on tariffs is incorrect, or at least the framing is incorrect.
Sorry Jeff, but the election was not even close to being close, because it's not decided by the popular vote. A Democrat pundit recently stated clearly that his party is now relegated "to 20 big cities and Aspen and Martha's Vineyard". LOL He is correct.
Donald Trump won 87% of the counties in this country and that is by any measure a landslide and a mandate.
His Electoral College victory was 58% to 42%, giving him more than a third more votes in the Electoral College than Karma llama ding dong.
It was a bloodbath and an annihilation. The majority of America has spoken that they have seen through the lies and being taken advantage of and being taken for granted and having their intelligence insulted by both Democrats and their puppets on a string, the American mainstream media. The momentum continues to build and liberals become more irrelevant by the day. The recent decision to put the absolutely loony David Hogg as Vice Chair of the DNC is simultaneously laughable and pitiful and is a desperate move to try to go after young people and men, as many in both groups will detest this obvious pandering.
My point is, a swing of how many votes in each state switches it? In 2016, it was about 100,000 total votes. In 2020, relatively the same. I do believe Trump has a mandate. I don't think he should walk on eggshells. But, I also believe the opposition is almost equal in number. They just aren't organized against this kind of assault.
It's like when I asked my friend who was a General what happens when 10,000 armed drones attack one battleship? He said, "It will sink." 10,000 armed drones are attacking the Big government battleship.
Good article Jeff, and you covered a lot of ground with some interesting predictions.
I have one constant reaction to "pundits"--which is almost always that they are wrong due either to ignorance or their tendency to shill for one viewpoint.
Thanks for all the insights in your post--which is definitely not in the "pundit" category.
Fundamental issue: In a world with global and highly-efficient transportation and communications…and billions of people who are accustomed to low wages…is it possible for a country such as the United States to maintain its accustomed high standards of living for the large majority of its people?…and, if so, what are the key policy elements required to do this?
It's not clear to me that this goal can be accomplished without either tariffs, or domestic-production tax incentives, or both...in addition to rationalizing regulations and driving higher productivity. Discussed at my Labor Day post from 2021:
Fair point but those same economics people who decry tariffs will tell you in the same breath creative destruction is great. AI will create jobs etc.
The point is, new tech will create crazy good jobs that are high paying. We just can't point to where. We have to be careful with having a fixed pie focus. There are very good manufacturing jobs in the US. Peter Zeihan in his book talked about how commoditized manufacturing is done outside the US, value add manufacturing is done inside the US--->this is even with the bad reg/tax environment we have today.
Whatever the result of this is won't be the same. The washer plant that left NoName, RustBelt isn't coming back the same way it left. What might startup?
This leads to a much broader question. How should education evolve to make sure this workforce is competitive? Obviously, school choice is a must there.
The President has clearly stated you will do manufacturing in this country or we will enact tariffs on you and/or not do business with you. The majority, if not all, will acquiesce to his request.
Bitcoin is going to 80k. Don't think I'd compare him to Peron. Milel did similar things. Different countries and different govt systems. Trump is doing a fantastic job right now and to try and sum it up after 10 days....maybe wait a couple of years
Hard to know. I doubt we'll get to the killing phase. But we're certainly in the cult phase. Trump has already said there's going pain in his mercantilist policies, but it will be worth it. I like the president to follow the law. Seems a lot of lawbreaking so far. The Rs have both houses of the congress. They should pass some laws. There was a reason for 3 branches of government - not co-equal, the legislative branch has the most power - in the constitution.
I don't think that "cult" is accurate, unless you point call the Democrats a cult, the UniParty a cult. I'd pick my phrases carefully. Government is being exposed for what it is currently. It's a redistribution of wealth from taxpayers to people with credentials and power.
MAGA is a cult. Trump talks mercantilist nonsense. This is all 100% anti-late 20th century Republican values. What makes it a cult is that people who know better buy it publicly, knowing that speaking up will get one excommunicated. Trump I fought to build Keystone pipeline. Today he says we don't need Canada energy. We don't need their lumber too. (Don't tell the people in CA, NC, or FL.) He has no understanding of supply chains saying all cars should be built in the USA. Free-ish trade is a big reason for America's wealth. Now he's going to tear it down because apparently he skipped Econ 101 at Wharton, the finest business school in the world.
Stuff people used to know:
Reagan on tariffs. Can one image Trump speaking in such coherent sentences?
Tanking currencies of Canada and Mexico makes imports cheaper
As far as DOGE goes, I hope there is some success. Any of these savings in discretionary programs won't do much more than marginally contribute to deficit or debt reduction. I also want the executive branch to follow the law. Republicans used to be for presidents following laws too.
If you want to find some crony redistribution just wait. Tariffs generate crony capitalism. Musk is already asking for his Chinese graphite to be exempt. And now we're going to get a sovereign wealth fund. Please recall how Chicago crony pension investment managers operate.
If you want to say the word "cult" is too strong, then maybe a Mencken quote on the wisdom of the electorate is more appropriate:
"As democracy is perfected, the office of president represents, more and more closely, the inner soul of the people. On some great and glorious day the plain folks of the land will reach their heart's desire at last and the White House will be adorned by a downright moron."
Multiple times the President and others in the Administration have said there will be short-term sacrifices for intermediate and long-term gains and that's exactly what has happened in the past and will happen this time. We've already seen multiple capitulations to the threats of tariffs in the first few days, which is remarkable.
Good Lord, at this point I should take a job as a spokesperson for this Administration. 🤣
Bingo. You nailed it. The main problem with a consumption tax is it really affects the wealthy. There are ways to maneuver around a an Income tax. Not 100% but you can lessen its' impact. Tough to do with a consumption tax, which is a more or less universal sales tax. You buy a $25K used car it's one thing. You buy a $100K+ Porsche it's another. Someone posted (on X I think) tariffs Denmark imposed on imported items. One was a 277% tariff on cheese. Yikes! I think that tells you everything you have to know.
Governments have to raise money. It's a mix on how they do it. As far as I know (though admittedly I don't know much) there is no magic formula or equation that tells exactly how to do it. it's sort of what works the best at the time and you have to look at it every so often because things change.
My first thought was that the tariffs are a step toward a de facto consumption tax, something of which I have long been in favor in replacement of an income tax, or in combination with a low, flat tax. I am otherwise basically in concurrence with what you've summed here.
Should Jim Cramer, Paul Krugman, and Robert Reich come out and says "tariffs are bad for US!", then we'll all be able to sleep easy.
Perfect comment
Tariffs are paid by the country they are imposed on which is much lower than the fallacy of the 'tax' that is paid here.
Trump tariffed foreign steel and aluminum in 2018, by early 2021 both prices were down 24%.
All other countries have effectively tariffed us for the last 80 years and it needs to end. Some could call it the Marshall Plan on steroids and Trump is smart enough to know our lunch needs to be saved.
I can see your empathy for the federal workers. But most of these people are mooches just like some of the politicians that have never worked in the private sector. They have sucked off the tit of the government their whole lives. Go to the post office when there are ten people in line and one clerk at the counter when you can see the others standing around doing nothing. They could probably get rid of half of the federal workers and it would run better and more efficient.
Not all. My grandfather was a scientist with the USFS his whole career. If they would have eliminated his job at 45, not sure what he would have done. Would there have been a job at a lumber company or not? Pure speculation.
Get your point about government bureaucrats in DC and the USPS. Privatize the USPS.
On the other hand, the USPS is one of the few things the Federales do that is specifically authorized by the Constitution.
I can see your point about you grandfather. Where would he have gone. But time were different then compared to today. People actually worked compared to today.
I tried to get a USFS or BLM job in the ’80s. They told me straight to my face multiple times that I didn’t have a chance because I was a white male. One guy suggested I go back for another 4 years of college and study computers; so I was among the early cohort of Americans told “Learn to code”. Ask me how much empathy I have for federal employees.
My grandfather retired in 1972. He was very upset at what happened to the USFS with regard to how they changed fire management and the way they viewed things. He was proud of what he had done. His generation was the first wave through. Over 45, it's going to be tough. Under 45...learn to code.
A lot of the old guard USFS were WWII vets who went to college on the GI bill. They were amazing and it’s a shame affirmative action destroyed what they built. Also amazing is that most of America’s trails and campgrounds, even now, were built by the CCC guys during the depression.
Trump saw what Musk did at Twitter when he eliminated 80% of the workforce without negatively affecting the quality of the product.
Our federal government has been much more bloated than even Twitter was and we are in the process of bringing about a similar result.
Although I have doubts, my gut says he is doing the right thing and it will turn out to be a positive. I tend to see the dark cloud not the silver lining, he is the opposite, a risk taker. Hoping for the best! Thanks for your insight on this, Jeff.
As a Canadian, I agree 100 percent with your opinion. Also Canada should have fixed the border problem without Trump having to do it for us.
This is a great article.
I agree about your prognostications.
How many times have we seen Democrats go, "aha! we got him doing something stupid! Look at the stupido that you elected!" It's all over the WSJ right now in the comments.
But then how many times do we see him pull a rabbit out of the hat, and everyone says, "Oh. I didn't see that one coming. He was right after all!"
I'm not saying this one will go that way, but to discount Trump's plans so early in the game is a fool's errand. He's making a move on the chess board, and we will get something for it.
The truth is that I trust that he has our best interests at heart, and he's earned the right to see it through. I'm not going to listen to the shrieking and wailing of the short-termers.
Members of the newly created “Department of Government Efficiency” under Elon Musk have engaged in an ongoing campaign designed to cripple the basic functions of government and decimate the federal civil service. Members of the Department of Government Efficiency are reportedly pushing for full access to payment systems and intend to scrape data from within the Department of Treasury. Cloud Software Group CEO Tom Krause has been designated liaison between the Treasury and the Department of Government Efficiency, with Musk reportedly wanting to add the Treasury to the blockchain. Agents from the Department of Government Efficiency have demanded access to classified info with USAID, with Elon later calling the agency a criminal organization and declaring “Time for [USAID] to die”. Civil servants across the federal government have been offered buy-outs to leave their positions early. Not only have no funds been appropriated for these offers (nor has the full legality been determined), but these buy-outs are being made by an administration lead by someone who has notoriously scammed contractors and avoided paying invoices whenever possible. These actions are taking place in the midst of an ongoing purge of high-ranking officials within the FBI by the Trump administration.
Make no mistake, what’s happening right now is a hostile takeover of the federal government by a private agency operating with a broad mandate and no concerns for the stability of the United States or the interests of the average American. It’s easier to break than it is to build, and Elon Musk’s agenda is focused on unraveling America’s governing institutions. When – not if – a preventable disaster is enabled by the Department of Government Efficiency’s decision to destroy a function of government in the name of “fighting wokeness”, there will be a reckoning for the damage Elon Musk has done.
this is not at all a comment that is accurate nor logical. If anything, private NGOs were actually running the government and we are going to see them eliminated
Musk mentioned on X that there are "payment authorization" officials whose sole job is to review payments the system generates and approve them.
They have never declined one payment in the history of this system or their careers.
And, there are organizations that are listed as "terror sponsors" receiving checks, because everything is essentially on auto-pay.
I completely welcome Musk flipping the system inside out and getting control of it. It is clearly being used for all kinds of slush funds, nefarious purposes and Democrat NGO's that do not have our nation's best interests at heart.
Gut it.
Oh, you mean like the Treasury Department that was told to never turn down a payment even to terrorist organizations? Yes, we have written, documented and verified evidence of that and the condescendingly arrogant jerk off who ran that department refused his boss's request for the passwords and instead just resigned in disgrace, so members of DOGE simply walked in the building(because most of the employees were working from home anyway and weren't present), changed everyone's password and within a day they had the computer passwords they needed.
Hysteria benefits no one.🤨🙄😄
interesting perspective. IMHO, wrong, but you do you.
who is wrong???
Phil Deluca's comment, IIRC
Economics 101- tariffs are bad.
But that’s not close to the real situation.
Our exporters all are hit with tariffs in other countries, and other countries produce goods, subsidized by their governments who get their funds from our government and the tariffs we pay!
It’s not close to fair now.
Typical Trump, start the negotiating very high and stroke a deal in the middle.
Trump is thinking in several dimensions: border security, protection of domestic producers and opening up markets for our companies here-
Politicians are very hesitant to being so bombastic. They look for common ground and dance around issues, and reach compromises that are mediocre at best.
Trump uses the stick more than the carrot, and he’s better terms, but makes him less popular.
Trump doesn’t care about being popular, that’s the Achilles heal of our politicians.
There will be uncertainty for a little while, that’s a non positive for markets, but I wouldn’t be selling just because Trump is firing his first salvos.
I disagree with one point. Politicians are all bombastic, especially on issues they think they can push! : ). One point you make that might not be totally grasped is the fact that the negotiation isn't about tariffs, but borders, protectionism, etc. As Marc Andreessen said, "Trump is a "systems guy"." He understands how all the parts fit together.
In the negotiation, why would Trump dismantle the internal American system that offers up similar protectionism to American companies without the others dismantling theirs?
I want to see it all dismantled. American Export-Import bank, subsides etc.
Spot on👏
This article is gold.
If nothing else, Trump got the economically illiterate Democrats to declare that tariffs may have some downsides for the American consumer. That only has taken 100 years or so for the buffoons in the Democrat party to take notice that someone has to pay for governments messing around with markets.
who just made 100 million in insider profits by knowing who would announce tariffs on Saturday? Who would know what Trump would say? Who would buy 50000 puts on Friday for $50 that will be $2000 tomorrow. or $250,000 will be $100 million DID you get the note? did you invest $50 to make $2000. Someone knew what Trump would say? ask who?
maybe someone that had the balls to put that kind of trade on?
Nancy Pelosi?
Not sure, but Trump has been saying this for several years now. Couldn't be that big a surprise when he pulled the trigger.
Call me crazy but weren't you saying Trump was unelectable fairly recently? I disagree with you now and I disagreed with you then. Either way I really enjoy your writing.
I was wrong. It was, like the two other past elections still generally pretty close. If the Dems were smart and not anti-Semitic, putting Shapiro in the VP slot probably wins them the election. I don't like tariffs at all. Think Trump is putting the cart before the horse. But, 95% of the commentary on tariffs is incorrect, or at least the framing is incorrect.
Sorry Jeff, but the election was not even close to being close, because it's not decided by the popular vote. A Democrat pundit recently stated clearly that his party is now relegated "to 20 big cities and Aspen and Martha's Vineyard". LOL He is correct.
Donald Trump won 87% of the counties in this country and that is by any measure a landslide and a mandate.
His Electoral College victory was 58% to 42%, giving him more than a third more votes in the Electoral College than Karma llama ding dong.
It was a bloodbath and an annihilation. The majority of America has spoken that they have seen through the lies and being taken advantage of and being taken for granted and having their intelligence insulted by both Democrats and their puppets on a string, the American mainstream media. The momentum continues to build and liberals become more irrelevant by the day. The recent decision to put the absolutely loony David Hogg as Vice Chair of the DNC is simultaneously laughable and pitiful and is a desperate move to try to go after young people and men, as many in both groups will detest this obvious pandering.
My point is, a swing of how many votes in each state switches it? In 2016, it was about 100,000 total votes. In 2020, relatively the same. I do believe Trump has a mandate. I don't think he should walk on eggshells. But, I also believe the opposition is almost equal in number. They just aren't organized against this kind of assault.
It's like when I asked my friend who was a General what happens when 10,000 armed drones attack one battleship? He said, "It will sink." 10,000 armed drones are attacking the Big government battleship.
I listened to "The Art of The Deal" yesterday and DJT has evolved BUT his tactics are the same. It works and it's proven. He's playing 3D Chess.
Good article Jeff, and you covered a lot of ground with some interesting predictions.
I have one constant reaction to "pundits"--which is almost always that they are wrong due either to ignorance or their tendency to shill for one viewpoint.
Thanks for all the insights in your post--which is definitely not in the "pundit" category.
Fundamental issue: In a world with global and highly-efficient transportation and communications…and billions of people who are accustomed to low wages…is it possible for a country such as the United States to maintain its accustomed high standards of living for the large majority of its people?…and, if so, what are the key policy elements required to do this?
It's not clear to me that this goal can be accomplished without either tariffs, or domestic-production tax incentives, or both...in addition to rationalizing regulations and driving higher productivity. Discussed at my Labor Day post from 2021:
https://chicagoboyz.net/archives/66613.html
Fair point but those same economics people who decry tariffs will tell you in the same breath creative destruction is great. AI will create jobs etc.
The point is, new tech will create crazy good jobs that are high paying. We just can't point to where. We have to be careful with having a fixed pie focus. There are very good manufacturing jobs in the US. Peter Zeihan in his book talked about how commoditized manufacturing is done outside the US, value add manufacturing is done inside the US--->this is even with the bad reg/tax environment we have today.
Whatever the result of this is won't be the same. The washer plant that left NoName, RustBelt isn't coming back the same way it left. What might startup?
This leads to a much broader question. How should education evolve to make sure this workforce is competitive? Obviously, school choice is a must there.
The President has clearly stated you will do manufacturing in this country or we will enact tariffs on you and/or not do business with you. The majority, if not all, will acquiesce to his request.
Make America Poor Again. Betting market totally blew this one. Equity futures down a few %. Bitcoin down 10%. Trump is more like Peron than Milei.
Bitcoin is going to 80k. Don't think I'd compare him to Peron. Milel did similar things. Different countries and different govt systems. Trump is doing a fantastic job right now and to try and sum it up after 10 days....maybe wait a couple of years
On the trade stuff Mao's Great Leap Forward may be a better comparison. In any case Milei isn't following some loony mercantilist path.
https://x.com/AlanReynoldsEcn/status/1886214744408748254
Comparing Trump to Mao is kind of silly
Hard to know. I doubt we'll get to the killing phase. But we're certainly in the cult phase. Trump has already said there's going pain in his mercantilist policies, but it will be worth it. I like the president to follow the law. Seems a lot of lawbreaking so far. The Rs have both houses of the congress. They should pass some laws. There was a reason for 3 branches of government - not co-equal, the legislative branch has the most power - in the constitution.
I don't think that "cult" is accurate, unless you point call the Democrats a cult, the UniParty a cult. I'd pick my phrases carefully. Government is being exposed for what it is currently. It's a redistribution of wealth from taxpayers to people with credentials and power.
MAGA is a cult. Trump talks mercantilist nonsense. This is all 100% anti-late 20th century Republican values. What makes it a cult is that people who know better buy it publicly, knowing that speaking up will get one excommunicated. Trump I fought to build Keystone pipeline. Today he says we don't need Canada energy. We don't need their lumber too. (Don't tell the people in CA, NC, or FL.) He has no understanding of supply chains saying all cars should be built in the USA. Free-ish trade is a big reason for America's wealth. Now he's going to tear it down because apparently he skipped Econ 101 at Wharton, the finest business school in the world.
Stuff people used to know:
Reagan on tariffs. Can one image Trump speaking in such coherent sentences?
https://x.com/pitdesi/status/1886236815319052308
Tariffs in Trump I didn't do any MAGA
https://x.com/MichaelRStrain/status/1885876477024940311
Regime uncertainty results in low investment
Tanking currencies of Canada and Mexico makes imports cheaper
As far as DOGE goes, I hope there is some success. Any of these savings in discretionary programs won't do much more than marginally contribute to deficit or debt reduction. I also want the executive branch to follow the law. Republicans used to be for presidents following laws too.
If you want to find some crony redistribution just wait. Tariffs generate crony capitalism. Musk is already asking for his Chinese graphite to be exempt. And now we're going to get a sovereign wealth fund. Please recall how Chicago crony pension investment managers operate.
If you want to say the word "cult" is too strong, then maybe a Mencken quote on the wisdom of the electorate is more appropriate:
"As democracy is perfected, the office of president represents, more and more closely, the inner soul of the people. On some great and glorious day the plain folks of the land will reach their heart's desire at last and the White House will be adorned by a downright moron."
Multiple times the President and others in the Administration have said there will be short-term sacrifices for intermediate and long-term gains and that's exactly what has happened in the past and will happen this time. We've already seen multiple capitulations to the threats of tariffs in the first few days, which is remarkable.
Good Lord, at this point I should take a job as a spokesperson for this Administration. 🤣
Bingo. You nailed it. The main problem with a consumption tax is it really affects the wealthy. There are ways to maneuver around a an Income tax. Not 100% but you can lessen its' impact. Tough to do with a consumption tax, which is a more or less universal sales tax. You buy a $25K used car it's one thing. You buy a $100K+ Porsche it's another. Someone posted (on X I think) tariffs Denmark imposed on imported items. One was a 277% tariff on cheese. Yikes! I think that tells you everything you have to know.
Governments have to raise money. It's a mix on how they do it. As far as I know (though admittedly I don't know much) there is no magic formula or equation that tells exactly how to do it. it's sort of what works the best at the time and you have to look at it every so often because things change.
Really insightful and interesting article. I appreciate this perspective. Hopefully these bureaucrats will disperse without any violence…
My first thought was that the tariffs are a step toward a de facto consumption tax, something of which I have long been in favor in replacement of an income tax, or in combination with a low, flat tax. I am otherwise basically in concurrence with what you've summed here.