By New York Post (Opinion) | Created at 2025-04-05 14:37:18 | Updated at 2025-04-06 06:49:49
16 hours ago
Donald Trump almost always has a point — including the bold ones he made on what he dubbed as “Liberation Day” late Wednesday afternoon.
On the topical issue of tariffs, for example, Trump was right that targeted, carefully considered import taxes can be a powerful bargaining chip. Especially when levied by the United States, the most economically invaluable market in the world — a market other countries can’t afford to lose access to.
Moreover, there are plenty of policy causes the president could reasonably enlist tariffs to advance. Russia must be made to pay for its criminal expansionism. Mexico must do more to stop the flow of people and fentanyl into the U.S.
China must be forced to abandon all manner of malicious practices – plus, America should be functionally independent of its chief geopolitical competitor in important sectors, such as pharmaceuticals.
Even the most ardent free traders can see value in the U.S. responding in kind when governments implement protectionist policies that make it harder for American goods to be sold abroad.
That Israel dropped its tariffs on US products in anticipation of “Liberation Day” is evidence enough that there’s merit to these tit-for-tat strategies.
Trump has articulated all of these fine ideas before.
Unfortunately, the program he unveiled in the Rose Garden this week failed to deliver such a thoughtful vision. Instead, the president announced the imposition of sweeping tariffs on much of the globe that he has inaccurately characterized as being “reciprocal.”
They’re anything but.
As countless economists, business leaders, and other experts have observed, the rates at which Trump has proposed taxing imports are, in most cases, far higher than those at which most other countries are taxing American exports.
In fact, the formula used by the White House to supposedly calculate the “tariffs charged to the U.S.A., including currency manipulation and trade barriers” is completely nonsensical.
Rather than plugging in other countries’ tariffs and accounting for their protectionist measures, administration officials simply took America’s trade deficit and divided it by the number of imports. This is why even countries with whom the United States has a trade surplus — such as the United Kingdom — are getting slapped with across-the-board tariffs.
Trump struck a triumphant tone while heralding his new policy – one that betrayed a far more essentialist understanding of tariffs than the instrumental one he’s embraced in the past.
“If imposing tariffs and protective barriers made nations poor, then every country on Earth would be racing to eliminate these policies,” insisted Trump.
But that doesn’t follow; just because other countries have mistaken tariffs for a sensible long-term economic blueprint doesn’t mean America has to follow suit.
“From 1789 to 1913, we were a tariff-backed nation and the United States was proportionately the wealthiest it has ever been,” he claimed before lamenting that “In 1929, it all came to a very abrupt end with the Great Depression, and it would have never happened if they had stayed with the tariff policy,” he said. “They tried to bring back tariffs to save our country, but it was gone. It was gone. It was too late.”
Trump’s account is one historical misinterpretation after the next.
The United States was not “the wealthiest it has ever been” from the late 18th century through the early 20th. And the Great Depression was not a product of a dearth of tariffs.
In 1922, Congress raised the average import tax to around 40%. Eight years later, it raised those punitive rates even higher with the infamous Smoot-Hawley Tariff Act, which economists and historians alike blame for plunging the country into even deeper economic doldrums.
There has been no shortage of instances – from immigration, to Covid, to Joe Biden’s mental fitness – in which widespread mockery of Trump has given way to an acknowledgement that he was incontrovertibly correct, at least in principle. This is why the near-universal opprobrium over Liberation Day has likely only steeled Trump’s conviction in his protectionist impulses.
Like other seemingly outlandish grand-plans from his still-brief second term — such as mass-Palestinian relocation or a 21st century “Star Wars” defense system — Trump’s tariff strategy reflects a world view that is unflinchingly aggressive and clearly articulated.
Economists may see Trump’s moves as chaotic — the markets may view them as uncertain — but there’s no need to read through the tea leaves here.
As with those meager NATO budget contributions, Trump believes America is being played and only he — and he alone — can redraw the rules of engagement. Liberation Day reflects the President’s penchant for full-scale assaults as opening salvos — yet with reasonable room for revisions later on (note his latest TikTok extension on Friday).
Leverage is the real goal here, and to gain it, Trump must convince trading partners to actually accept what he has made so apparent: That he genuinely believes tariffs are an economic panacea — and will need significant concessions not to move forward with them.
Still, with a Republican loss in Wisconsin this past week and next year’s midterms already on the radar, the Administration understands it can only roil markets and cause trading partners to recoil for so long.
Trump may owe his reelection to his steely convictions, but he may ultimately have to reconsider his current course if the pain — both consumer and diplomatic — becomes too much to bear.
