The Trump administration’s trade wars are crushing U.S. small businesses

  The great American historian Barbara Tuchman once described folly in government as the pursuit of policies contrary to a country’s own interests and despite the availability of feasible alternatives. Folly, as Tuchman noted, is more than just a one-off bad decision; rather, it is the consistent implementation of a policy that achieves the opposite of what is intended. The Trump administration’s unprecedented trade war rises to this level of mismanagement.

  President Donald Trump’s embrace of tariffs to a level not seen in more than a century, supposedly to foster the redevelopment of the country’s industrial base, will do the opposite of what he intends it to do. It will crush U.S. small businesses, particularly those engaged in manufacturing, decimating the backbone of American industry and of countless communities across the country. Already, corporate bankruptcies are up 7.38 percent year over year, commercial freight contracts have plummeted, ports are empty, and hiring has been frozen across several different industries.

How much damage will come from this trade war?

  First, the good news: the U.S. and world economies have not imploded, so far, as fallout from the rising trade tensions between the Trump administration and Xi Jinping’s government in China. Now, the bad news: there is no certainty that this will not play itself out as a serious and damaging trade war between the two countries that might spill over into grievous harm to many other parts of the world as well.

  From the day that Donald Trump became president, he has been telling the American people and everyone else that he believes that national economic prosperity requires seeing international trade as a zero-sum game. In his mind, the buying and selling of goods and the investing of capital across political lines on a map of the world is economic combat creating winners and losers.

Trump’s trade wars destroy our freedom

  Given President Trump’s trade wars against China and other countries, the natural tendency is to focus on Chinese and American producers and consumers as the victims of Trump’s destructive trade folly.

  Keep in mind that in every trade, both sides benefit by improving their respective standard of living. That’s because in every trade, both traders give up something they value less for something they value more. Thus, standards of living can rise through the simple act of trade.

Trump’s trade war destroys our freedom

  It is a fundamental economic axiom that trade raises people’s standard of living. That’s because in every trade, both traders are giving up something they value less for something they value more. As soon as a trade is completed, both actors have raised their standard of living based on their individual, subjective valuations.

  You go to the grocery store and spend $100.You gave up the $100 to get things (groceries) that you valued more than the money. Your standard of living just went up. So did the standard of living of the grocer. He gave up something he valued less (the groceries) for something he valued more (the money).

Richard M. Ebeling: Trump’s protectionist follies threaten a trade war

  President Donald Trump has announced the planned imposition of a new 25 percent tariff on imported steel and a 10 percent tariff on foreign-made aluminum entering the United States. This has brought about threats of trade retaliation by a number of America’s trading partners. The menacing clouds of a possible trade war are showing themselves on the global horizon.

  Claiming that other countries are taking advantage of the U.S., as reflected in American trade deficits, Trump, in one of his infamous tweets, has declared that “trade wars  are good, and easy to win.” How and why? Trump asserted: “Example, when we are down $100 billion with a certain country and they get cute, don’t trade anymore-we win big. It’s easy!”

Richard M. Ebeling: Trump’s economic warfare targets innocent bystanders

  An often forgotten truth is that it is not just military warfare that can cause injury to innocent bystanders, the same happens in economic warfare initiated by governments as well. But in the latter case, the human “collateral damage” is a targeted victim.

  On March 29, 2017, The Wall Street Journal ran a story highlighting the Trump Administration’s likely intention on getting tough in trade talks about American beef sales to the European Union. Being more in tune with “nature” and the “natural” than the United States, the European Union long ago imposed trade restrictions on the importation of American beef that has been bred with the use of artificial hormones.