- Oct 23, 2012
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Trump is following in Abraham Lincoln's footsteps when it comes to trade. The policy of high tariffs/protectionism used to be a bedrock principle, if not the bedrock principle, of the Republican Party, starting with Abraham Lincoln and continuing well into the 20th century (e.g., President Howard Taft and Senator Robert Taft, aka "Mr. Republican").
America thrived and became an industrial giant thanks in large part to being shielded from unfair foreign competition by high tariffs. Nations like China have flourished and vastly expanded thanks to fiercely protectionist policies.
Globalists and free traders claim that higher tariff rates will simply be passed on to American consumers and will cost us jobs, but history refutes this claim. Most or all of the companies that sell foreign products in the U.S. would not dare pass on the entire cost of the tariffs to consumers. If they did, most of their products would suddenly cost more than competing American products and consumers could buy the American products instead. High tariffs protect American factories from having to compete with foreign factories that pay their workers dirt wages, that pay few or no benefits, and that have a fraction of the health-and-safety regulatory costs that American factories have.
Furthermore, we know from history that protective tariffs encourage the domestic production of products to compete with foreign-made products, precisely because foreign-made products are subject to tariffs. A company that made products in the U.S. could sell those products to American consumers without having to worry about tariff rates, because their products would not be subject to tariffs.
President Ronald Reagan saved the Harley-Davidson motorcycle company in 1983 by raising the tariff on Japanese motorcycles by 45 percentage points, from 4.4% to 49.4%. He took this action to protect the last remaining American motorcycle maker from cut-throat Japanese competition, and saved thousands of good American jobs in the process. And, incidentally, when Reagan took that action, the Japanese were unable to raise the price of their motorcycles sold in the U.S. enough to offset the tariff, which is why Reagan’s action saved Harley-Davidson.
NAFTA has been a bad deal for us
About 80% of the job losses caused by NAFTA have been in manufacturing jobs, which are good-paying jobs with benefits. NAFTA *has* been good for some large American corporations, but it has been bad for Main Street America and for middle-class jobs.
NAFTA Is 20 Years Old – Here Are 20 Facts That Show How It Is Destroying The Economy
How Free Trade Is Killing Middle America
NAFTA at 20: One Million U.S. Jobs Lost, Higher Income Inequality | HuffPost
North American Free Trade Agreement (NAFTA) | Public Citizen
https://aflcio.org/sites/default/files/2017-03/March2014_NAFTA20_nb.pdf
No, the Smoot-Hawley Tariff did not cause the Great Depression and did not start a "trade war"
Globalists also claim that the Smoot-Hawley Tariff, passed in 1930, caused or greatly contributed to the Great Depression, and that it started a trade war. But this claim is erroneous. The Smoot-Hawley Tariff raised tariff rates by only 2.5 percentage points, and the economy was already starting to slow down by the time the tariff was passed anyway. Furthermore, the Fordney-McCumber Tariff of 1922 raised tariff rates by a much larger amount, and that tariff was followed by six years of robust economic growth. And virtually no nations retaliated to the Smoot-Hawley Tariff (partly because they knew they were using protectionist policies as well).
Tariffs: The Smoot-Hawley Fairy Tale
Protectionism Didn't Cause the Great Depression
America thrived and became an industrial giant thanks in large part to being shielded from unfair foreign competition by high tariffs. Nations like China have flourished and vastly expanded thanks to fiercely protectionist policies.
Globalists and free traders claim that higher tariff rates will simply be passed on to American consumers and will cost us jobs, but history refutes this claim. Most or all of the companies that sell foreign products in the U.S. would not dare pass on the entire cost of the tariffs to consumers. If they did, most of their products would suddenly cost more than competing American products and consumers could buy the American products instead. High tariffs protect American factories from having to compete with foreign factories that pay their workers dirt wages, that pay few or no benefits, and that have a fraction of the health-and-safety regulatory costs that American factories have.
Furthermore, we know from history that protective tariffs encourage the domestic production of products to compete with foreign-made products, precisely because foreign-made products are subject to tariffs. A company that made products in the U.S. could sell those products to American consumers without having to worry about tariff rates, because their products would not be subject to tariffs.
President Ronald Reagan saved the Harley-Davidson motorcycle company in 1983 by raising the tariff on Japanese motorcycles by 45 percentage points, from 4.4% to 49.4%. He took this action to protect the last remaining American motorcycle maker from cut-throat Japanese competition, and saved thousands of good American jobs in the process. And, incidentally, when Reagan took that action, the Japanese were unable to raise the price of their motorcycles sold in the U.S. enough to offset the tariff, which is why Reagan’s action saved Harley-Davidson.
NAFTA has been a bad deal for us
About 80% of the job losses caused by NAFTA have been in manufacturing jobs, which are good-paying jobs with benefits. NAFTA *has* been good for some large American corporations, but it has been bad for Main Street America and for middle-class jobs.
NAFTA Is 20 Years Old – Here Are 20 Facts That Show How It Is Destroying The Economy
How Free Trade Is Killing Middle America
NAFTA at 20: One Million U.S. Jobs Lost, Higher Income Inequality | HuffPost
North American Free Trade Agreement (NAFTA) | Public Citizen
https://aflcio.org/sites/default/files/2017-03/March2014_NAFTA20_nb.pdf
No, the Smoot-Hawley Tariff did not cause the Great Depression and did not start a "trade war"
Globalists also claim that the Smoot-Hawley Tariff, passed in 1930, caused or greatly contributed to the Great Depression, and that it started a trade war. But this claim is erroneous. The Smoot-Hawley Tariff raised tariff rates by only 2.5 percentage points, and the economy was already starting to slow down by the time the tariff was passed anyway. Furthermore, the Fordney-McCumber Tariff of 1922 raised tariff rates by a much larger amount, and that tariff was followed by six years of robust economic growth. And virtually no nations retaliated to the Smoot-Hawley Tariff (partly because they knew they were using protectionist policies as well).
Tariffs: The Smoot-Hawley Fairy Tale
Protectionism Didn't Cause the Great Depression
