No Stupid Questions

Ok, another answer closer to the ground. 2 goals are often invoked. Reduce the trade deficit and increase domestic manufacturing.

1. Trade deficit

... means that more goods (and services) come into the US from the rest of the world than the US delivers in return.

Reducing the trade deficit makes Americans poorer by design. There will be fewer goods available for Americans, either because they have to give up more to the rest of the world, or because they don't come into the country in the first place.

The rest of the world is willing to loan money to people, companies, and governments in the US. It is also eager to invest in the country, because it really was a good place in which to do business. Look at the current big thing: AI. You can't really do that in the EU, and investing in China has its own risks. Trump may actually reduce the deficit by making the US more of a South American style banana republic.

2. Manufacturing in the US.

One manufactures stuff outside the US and transports it there because it is more efficient. Americans can be more profitably employed in different areas. Moving more manufacturing to the US should be expected to leave the average American poorer. It should not be expected, in isolation, to reduce the trade deficit as it creates new investment opportunities that potentially attract foreign money, increasing the deficit.

However, while Americans would be left financially poorer, there may be benefits not captured by conventional econometrics. Maybe manufacturing is more emotionally satisfying in a way that is not captured by only looking at the wages. Who knows?

Unfortunately, getting to that state will be brutal. Millions of people will have to find and learn new jobs. That is what happened when manufacturing was off-shored. Reversing that will have the same cost. Some economists have come to believe that the psychological cost of such structural changes has been vastly underestimated, and that is why trade agreements are so unpopular. The benefits from free trade may not outweigh the psychological pain and disruption of communities. Reversing free trade will have similar effects, that are likewise virtually impossible to measure.

I think the most objective benefit would arise if a war happened that disrupted trade. For example, if Trump invaded Canada and Greenland, this would probably lead to the US being embargoed. Then it would appear good to have already built manufacturing capacity in the US while it was still easy. You need physical goods to fight wars, after all.

That's kind of subjective.

There are two broad views on whether something 'was a good plan.' Generally, everyone agrees that accomplishing the intended goal is the first requirement, but people tend to divide then on whether there is a secondary requirement. Many hold that the second necessary requirement is that the action doesn't violate prior tenants.

e.g. if the goal is to get children out of a burning building, actually getting them out is generally a minimum requirement for 'a good plan', however, if the plan is to get them out by punting them out the window, it would be argued by many that the plan was bad because it violates a prior tenant to not hurt the children.

For the tariffs, it is almost a given that it will create a better business environment for companies that want to compete in sectors where tariffs act as a protectionist measure. However, it is also generally a given that the tariffs will cause financial pain for the average American, whose standard of living depends on cheap foreign labor. For many people, the damage done to the American public is like the punting. It violates established values, and thus becomes a bad idea.

This also all assumes the stated goal is the real goal. The claim is the tariffs are intended to help American businesses, but the general interpretation is that's a lie. Many people believe the tariffs are simply a threat to get obedience from other governments. From this view, the tariffs are a failure, because essentially no power has been gained over the rest of the world, and many places that were cooperating freely before now have antipathy toward the US.

If you're looking for convincing arguments; read through the responses from this panel of experts: https://www.kentclarkcenter.org/surveys/tariffs/ (from 2024) and more recently: https://www.kentclarkcenter.org/surveys/tariffs-reciprocal-and-retaliatory-2/

Many of the responding professors provide detail on why they vote a certain way. For example to the 3rd part of the question from 2024: "The gains for the American economy from tripling the tariffs would measurably outweigh the losses." you get replies like:

Protectionism via tariffs creates well-understood aggregate losses in efficiency. This is so even if China "unfairly" subsidizes its steel. Political motivations aside, actual distributional impacts are modest, ill targeted, and better handled with other more direct tax tools.

With links to further background information: https://economics.mit.edu/sites/default/files/publications/CW%2004-15-22.pdf & http://www.econ.ucla.edu/pfajgelbaum/tradewar_1203.pdf with more detail to read.

Not sure if this will convince you or not; but it's at least a cache of relevant information.

There is no absolute, objective way to judge if some policy is a good or bad. We can only determine if some policy achieves its goals. This is difficult as different justifications for the tariffs have been given.

We can also have philosophical arguments over whether the goals are good in some abstract sense. For example, some people on the right feel that the US not having access to X-mas knick-knacks and gifts is positive, as it will force people to engage with religion.

This guy does defense economics but he did a good piece on the tariffs: https://m.youtube.com/watch?v=nVZ1lcw2bVU

They're not. If you think they are you're a moron. There's no gentle way to put it.

It's a grift. They already did it once this month, it's called insider trading.

A lot more people will be unable to acquire a lot of things. There will be a lot more crime.

The higher tariffs are paid by the importers, who make the customer pay for that. And considering that the minimum wage is now below the poverty line, a lot of electronics, even necessities like washing machines and fridges, will be unaffordable by some people.

And what is the result when a lot of people can’t afford basic necessities? Crime.

Give it a year.

Any economist or data scientist should be able to pretty easily compare the economic course to a forecast of what would have happened with minimal interference.

Will we listen? No, because experts don’t count for shit in the US anymore.

Your degree of credulity should be criminal.

We already know. We already know they're bad.

We know because the negative effects are already happening, and literally every expert on the matter has said they are fucking stupid.

Everything the rapist trump does is to help himself. He does nothing for the good of the people. That's one major way you know he's fucked us.

He also consistently lied to everyone about who pays the tariff, making sure his brainless followers buy in, helping fuck us harder. Nothing that comes from his mouth is understandable or the truth.

The only person who has any excuse of thinking Tariffs are a good idea is Ferris Bueller because he missed the lecture.

there are people who are completely happy with the economy going to absolute shit as long as its by the hand of conservatives.

literally ran into red-hat magas living on disability from the VA whose children are all now unemployed and they couldnt be fucking happier.

these people will absolutely eat trumps feces if it means a democrat has to smell it. there is no reasoning. facts do not fucking matter.

There are ways that tariffs can be used to protect domestic industries. But when they're done that way, it's normally specific products, implemented carefully and with some warning. I'm pretty sure there are some tariffs to protect American automakers, off the top of my head.

What the president did is just economic suicide. Sudden, huge, fairly indiscriminate, and fluctuating. I think his goal, in his mind, may have been to replace the income tax, but he really fumbled. And that's a bad idea anyway, because tariffs and sales taxes hit the middle class hardest, which slows down the economy.

There may also be an explanation that he really doesn't understand cooperation and believes every deal has a winner and a loser. And then very mistakenly concluded that we were the losers in international trade because of our trade deficit. That's incorrect. We get large amounts of goods and resources for small amounts of fiat currency, which we always seem to have more of. Our trade deficit considerably improves our quality of life in ways that cannot be replicated by an insular economy.

Sir, this instance is called 'No Stupid Questions'.

This is by and large - a stupid question.

I’ll take a stab at a “serious” answer, although be cautioned that this thinking is irrational.

If they worked, we would see manufacturers almost instantly beginning construction on US factories, opening new ones and reopening shuttered plants. We would see trade “balance” in terms of imports and exports with every trading partner we have.

If you like paying more for stuff, then yes, it’s a win 🥇

They were a beneficial strategy. They made Trump and his buddies massive amounts of money from manipulating the stock market. They were even bragging about it after the fact.

Oh, you meant for the country and its people... Nah, that was never the point. If they were thought out at all it was only how it benefits Trump and his buddies.

Short answer. They're not.

Roll a die, if it's greater than 7, then they're a good idea.

Even proponents of tariffs have to admit that the level of thought and planning that went in their execution are incredibly lacking.

Tariffs always raise prices. Sometimes they do protect local industry, by raising prices so that local industries can compete against foreign competitors. At least for a time. Usually it leads to the eventual failure of the industry due to making less competitive products.

The most meaningful metric of any economy in my opinion is always median real income. It means whether most people are more able or less able to live the life they want (to vastly over-simplify).

I am not an economist, but I'd think a couple of reasonable metrics would be:

• Taxes raised through tariffs are enough to significantly replace a significant portion of personal income tax burden across all taxpayers, while not raising the price on goods so much as to negate that benefit.

The math we've seen so far does not come anywhere close to supporting this. According to the St. Louis Fed, personal income taxes collected in 2024 was about $9.6 trillion. The increased tariffs have pulled in $6.3 billion in the past month, according to the Treasury Department, as reported in Newsweek. Extrapolated for the year, that comes out to about $0.08 trillion, or 0.8% of what is collected in income tax. The numbers don't add up even if the tariffs collected increase once the actual rates are stable, nor does this administration seem interested in giving a tax cut to anyone other than the wealthiest taxpayers, nor would I implicitly trust the numbers from this administration's Treasury Department.

Furthermore, that doesn't address how much of the tariffs are past to the consumer - which will be damn near all. Also, around 30%* of tax returns were for $0 in taxes due to low income and various exemptions, so the inflation in goods will be a net negative - as you can't cut a $0 tax - for what is mostly the poorest third of the population. Inflation induced by tariffs are about as regressive a tax as there is. (*The figure I have for this is 31.42% in 2022 according to the National Taxpayers Union Foundation. I'm assuming the figures aren't wildly different for 2024.)

• Increased manufacturing in the US, especially in strategically valuable goods, such as semiconductors.

This is a less quantifiable benefit, but can be good for supply chain stability and national security, in theory. It will take years to come to fruition, as factories take a long time to set up, and businesses will need a clearer picture about where the economy is headed before taking on such large investments. On-again, off-again policies delivered in tweets don't provide that - quite the opposite. Moreover, said goods will mostly be more expensive due to higher labor costs, providing little to no relief on the inflation front. It also should be pointed out that successes on this front will reduce tariffs coming in, acting against my previous metric.

What effect this has on the trade deficit I don't see as important. You run a trade deficit relative to your local grocery store since they don't buy things from you, and what would you do to remedy this? Start a farm? Having invested the time and money in a farm, would you come out ahead? Not likely. The trade deficit is a political football that fiscal conservatives love to complain about, but do not follow up on when they're in power.

All that said, I emphatically do not agree with the current administration on these policies, or really any policies, just to admit my biases.