Question

b. Provide 3 CON arguments with supporting evidence about Trump Trade & Tariff Policy

Answer 1

Imposing a tariff on goods imported from foreign countries is effectively the same as imposing a tax on all Americans who use the type of product on which the tariff is imposed, even if they buy units of that product which are manufactured in the USA.

This is because manufacturers NOT subject to the tariff would no longer face as much price competition. Prices in America would then rise on every unit of the type of product subject to the tariff, not just those units made in countries subject to the tariff.

So any jobs supposedly created/saved by such a tariff would actually be created/saved by the higher prices American consumers would be forced to pay. The benefit to the comparatively small number of Americans who make that type of product would be directly paid for by all Americans who use that type of product.

In reality, then, a tariff nominally directed at 'cheating foreigners' would actually have a broad impact on all American consumers of that type of product, no matter who they bought the product from. Much the same as if the government imposed a sales tax on all units of that type of product made anywhere but let the manufacturers not subject to the tariff keep that tax.

• NOTE: this would benefit not only all American manufacturers of the tariffed product but also all manufacturers in foreign countries not subject to the tariff.

There are a few other very important consequences of a tariff:

• One is that increasing prices in a tariffed sector robs consumers of the ability to spend in other sectors of the economy. So, if a tariff is imposed on a widely-used and/or critical type of product, demand in most other sectors will decline. Because of this, the NET impact of past tariffs across the entire economy has been negative. In other words: the relatively small number of Americans who benefited from past tariffs did so at the expense of the rest of the country.
• Another is that we have to expect tariffed countries to place retaliatory tariffs on our exports. Not a problem if we're only dealing with a few smaller countries, but Trump is talking about many populous countries, including China. You don't have to be an expert to recognize the tremendous negative impact of threatening our current (or future improved) access to a market of that size.
• Finally, the fact that any benefits tend to end up in the hands of the owners and management of protected manufacturers, rather than their workers, really shouldn't surprise anyone. Especially anyone who’s been watching how Trump operates. In fact, because Trump's announcement was apparently a shock to even most of his close staff, something tells me it might be interesting to look closely at the recent financial interactions between the Trump family and the owners and management of companies that would be protected by his tariffs.