By: Jože Biščak
Some might find it inappropriate, but I have to admit that in recent days and weeks I have been thoroughly entertained watching, listening to, and reading the progressive mainstream media as they report and comment on how the White House is introducing tariffs left and right.
The dilemma in which the leftists find themselves is priceless. To criticise Donald Trump’s actions, they must now resort to Adam Smith (the invisible hand of the market), David Ricardo (the theory of comparative advantage), and classical economic liberalism (Carl Menger, Ludwig von Mises, Friedrich von Hayek). Something that the left hated just yesterday has overnight become an argument against the American president: in criticising Trump, the leftists have become advocates of free trade – not to say capitalism. What they previously rejected with disgust is now being praised to the skies by leading far-left media outlets. Were they not the ones warning that capitalism causes poverty, inequality, global warming, and is responsible for all the ills of the world? And now this. A true Copernican shift by the leftists!
Let’s be clear: I personally believe tariffs are bad. History teaches us that countries which operated under the principles of free trade became prosperous nations. Conversely, those that imposed tariffs, export-import quotas, and regulations that hindered free trade, became and remained poor. A tariff is nothing more than a tax (and every tax is a form of regulation) levied on imported goods from other countries. Usually, this tax is calculated based on the value of the product. For example, a 25% tariff on a product worth 100 euros means an additional cost of 25 euros. Companies that import foreign goods pay this tax to the government. They may choose to pass some or all of the cost onto consumers or to import less foreign goods. In either case, this means that consumers will pay more for foreign products or will no longer have access to them. Any restriction on the free flow of goods is therefore not good for the consumer. And in this case, Trump is seen as the “bad guy”, while the rest of the world (especially the EU) are the “good guys”. But that is only the appearance – the background is something the leftist media conveniently leave out.
Although the U.S. has experienced faster economic growth in this millennium than other developed countries (including the EU), and one could therefore argue that global trade is not to blame for the destruction of the American middle class – as advocates of tariffs claim – it must be acknowledged that the EU has acted very unfairly toward imports from the U.S. The Americans have always had very low tariffs on goods from developed European countries, while goods imported from across the Atlantic have faced much higher tariffs. Just look at the automotive industry. Tariffs on American cars were several times higher than those on European cars entering the U.S. This did not just protect the domestic (European) auto industry – it also helped fund all the ideological baggage that postmodernism has dumped onto the Old Continent; in every product, there is also a price tag for bloated policies and excessive regulations.
Then Donald Trump came along with a needle and popped the bubble. Naturally, the outrage was immense, because the days of the comfortable European export model – when honey and milk flowed freely – were over. The White House made it clear: the U.S. will no longer finance your welfare state, green transition, bloated Brussels bureaucracy, leftist ideological agendas, rainbow parades, and so on. And now leftist commentators are crying and stirring up political outrage (despite the three-month delay in implementing the tariffs) into a holy war against Trump. These are the same people who just a few months ago were cheering for higher minimum wages, billions of euros for social tourists from third-world countries, increased levies for a carbon-free society, and the redistribution of wealth (all of which were reflected in the prices of products), and now they mourn the supposed collapse of free trade.
It has all fallen apart. I truly hope that EU leaders will be sensible enough to strike a deal with the U.S. Trump has already extended a hand.
