Who thought tariffs was a good idea?

The past week has seen some of the most tumultuous economic times in recent memories. The introduction of tariff’s to almost every civilized country has resulted in trillions of dollars of lost wealth, fears of a recession, mortgage rates climbing from 6.5% to over 7%, inflation worries, and people now stressed about their jobs and cost of living.

All because of tariffs.

If there’s one lesson from all this chaos, it’s that we live in a globalized economy and a world of dependency of other countries. The United States of America cannot stand alone (no matter how much we try to delude ourselves that isolationism and protectionism is solid economic policy).

And America benefits greatly from international trade. Budweiser is one of the most popular beers in Europe and Asia. The NBA and NFL are globally popular. Microsoft software is used worldwide. Facebook and Google are global brands. Boeing sells planes to almost every foreign country. Ford European sales are almost greater than their American sales. Coca Cola and Pepsi are very popular globally. Name a fast food franchise (McDonalds, Starbucks, Pizza Hut..) and they have a global presence. Many American movies do as well, or better, globally than at home. Our agricultural products sell robustly overseas (from apples to almonds to pears). Imported raw goods like steel and aluminum are used to build less expensive cars, boat, bridges, and skyscrapers.

Every country is inner-connected somehow (yes, even North Korea, Iran, and Russian benefit from international trade).

And, if you’re going to look at American job loss, then look no further than automation and technology which is responsible for thirty or forty times as many American jobs being taken away than off-shoring. Every single sector of the economy has had job loss due to some technological innovation. From the invention of the chainsaw to automation in factories to travel sites replacing travel agents. Even now, banks are laying off tens of thousands of people because they’re going the route of the ATM.

While some people applaud AI, many others will see their careers disappear.

Globalization and international trade seem to have gotten a reputation as the reason behind our ills and pains. It’s a convenient scapegoat to blame “some foreigner” taking away American jobs. But the issue is far, far more nuanced and complicated than that as the recent world response to the tariffs have shown us.  

America reaps as much benefit, if not more, from international trade and any other thought process will bring great folly and misfortune upon the country.

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