Over the past week, President Trump’s proposed tariff plan has begun to take shape. He signed two proclamations that will take effect on March 23. As previously reported, these proclamations will include the 25 percent tariff on steel and the additional 10 percent tariff on aluminum. In the past, tariffs and protectionism have only resulted in a further fettered America in the long run.
In 1929, President Herbert Hoover implemented the Smoot-Hawley Tariff, which contributed to the Great Depression. President Richard Nixon’s 10 percent surcharge on all dutiable imports precipitated into stagflation seen in the 1970s. Even President Ronald Reagan admitted that his provisions against Japanese steel was regrettable. More recently, President George W. Bush’s steel tariffs were unsuccessful in reviving the steel industry. Otherwise, this current conversation wouldn’t be relevant.
New developments seem to indicate a quasi-capitulation emanating from the current administration. Canada and Mexico are exempt from the tariffs. Many analysts speculate that these exceptions may correlate with the current renegotiations of NAFTA. Furthermore, these proclamations are supposed to be flexible in order to address national security issues while simultaneously allowing some countries to negotiate for exemptions, similar to the Mexico and Canada caveat. These negotiations will be discussed on a “case-by case,” basis which are contingent on separate bilateral agreements. However, many countries have threatened retaliatory tariffs of their own. The EU has warned that a “tit-for-tat” tariff will take effect on American products. A trade war seems to be on the horizon. During his campaign, Trump personified the trade deficit as a despot who had unjustly left Americans jobless. He has resonated with the working class and continues to promulgate their plight. In an article from The Hill, chairman of the Mahoning County Democratic Party in Ohio, David Betras, avers, “Everyone makes him [Trump] out to be this idiot. He’s playing to the voters of Wisconsin, Pennsylvania, Ohio, Michigan and Iowa.”