From an economic perspective, Trump’s protectionist policies will make the American economy less efficient and lower living standards for American households.
If you want to know the macro damage, here are the latest estimates from the Tax Foundation.
And if you want to know the micro impact on households, here are the latest estimates from the Yale Budget Lab.
Nothing surprising in this data.
What is surprising, however, is the way some Republicans are happy that the government is getting more money.
The White House is channeling Bernie Sanders by celebrating $150 billion being taken from taxpayers.
The Treasury Secretary is channeling AOC by celebrating $27 billion being taken from taxpayers.
And the Secretary of Commerce is overjoyed by the prospect of $700 billion being taken from taxpayers, which is so crazy he must be channeling the spirit of Karl Marx.
I remember when the Republican view was that it was better to “starve the beast” rather than “feed the beast.”
So it is remarkable to see so many GOPers being happy that Washington is getting more money.
When I raise this issue with the Trumpies I know, they invariably respond with the silly claim that foreigners are paying the tax.
This obviously is not true, but I don’t need to provide proof with a long and boring column about “tax incidences” and “tax elasticities.”
Instead, I only need to point out that Trump and one of his top allies in the Senate want a new government handout to offset the damage to American families.
Here are some excerpts from Allan Smith’s NBC report.
Republican Sen. Josh Hawley introduced legislation Monday to provide tariff rebate checks of at least $600 per adult and child to American families… Hawley, R-Mo., submitted his legislation after having pledged to do so Friday after President Donald Trump told reporters he would be interested in sending a tariff-related rebate check to Americans. …The program would be set up as a refundable tax credit, with the government sending checks this year should the bill advance through Congress and get Trump’s signature. The bill would ensure that each adult and dependent child would get at least $600. …The independent Tax Foundation projected that Trump’s tariffs…would effectively increase taxes on the average U.S. household by nearly $1,300 this year and nearly $1,700 in 2026
If America families are being hurt by tariffs, the right response is to get rid of the protectionist policies rather than to create a new entitlement program.
But I give Hawley credit for honesty. His legislation is based on the recognition that it is Americans who are bearing the brunt of Trump’s trade taxes.
P.S. Just in case you wonder whether Trump is right about trade, I can’t resist adding a final observation that the world’s 10-most-free-trade nations have per-capita GDP that is 14 times greater than the world’s 10-most-protectionist nations.
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