Trump’s Self-Destruction

As I have often acknowledged, a sizeable portion of Trump’s MAGA base have good reason to be angry about their circumstances, even if that anger is totally misdirected at boogeymen such as liberals, elites, the media and internationalists, among many.  But no matter if their feelings are justified, they’ve settled on a horribly negative worldview accompanied by some very self-destructive impulses.  Under the guise of “Making America Great Again” they want to tear the country down, destroy everything, as evidenced at the U.S. Capitol on January 6th.

Lately it’s hard not to see similar impulses at work in their fearless leader, Donald Trump.  With his passion for tariffs tanking his cherished stock market and putting the American economy at risk for no good reason, clearly there’s a disturbing parallel between Trump’s destructive behavior and the negative MAGA psyche.  And it doesn’t stop there; whether it be the U.S. economy, government agencies that enable our country to function, or the world order that America has dominated since the Second World War, Trump and his MAGAs make no secret of their desire for total destruction.  

Even though economists almost universally oppose tariffs, I’m not entirely unsympathetic with Trump’s goals, assuming I understand them correctly.  As part of his promise to “Make America Great Again,” Trump wants to turn the clock back to the days before the globalized economy, which to be fair, has all but decimated American manufacturing and eliminated the high-paying factory jobs which helped to build the American middle-class.  The problem is, to use a cliché that was popular back in my day, the horse is long since out of the barn.  One can make the argument that the North American Free Trade Agreement (NAFTA) was a terrible mistake that cost our country dearly and was a major contributor to our current set of woes, but if I may evoke another old cliché, it’s hard to put the genie back in the bottle.  

Foreign Trade is a Lot More Complicated Today than it was in William McKinley’s Time.

Modern factories can take years to build or even retool and supply chains are complicated.  If anything is as ingrained in our national identity as the myth of the “cowboy” it’s the story of how the Ford Moter Company stopped producing cars and began building tanks and jeeps “overnight” when we entered World War II.  Maybe that was true in 1941, but such a feat would be virtually impossible to replicate today, technology being what it is.  It’s not just that tariffs and trade wars have been a disaster throughout American history, consider the goods being traded when Trump’s hero, William McKinley, was president (circa 1900); presumably they didn’t include automobiles or smart phones, and nobody worried about the supply of semiconductors.

Even if Trump is well-intentioned in his desire to reshore jobs and rebuild American industry, his tariff wars are unlikely to achieve that objective in any reasonable amount of time, if ever.  I realize there could be more complicated explanations for his behavior long-term, such as protecting the dollar-based global financial system, but in the meantime he refuses to acknowledge that tariffs are a tax on consumers, not the country that imports the goods.  In other words, tariffs will raise prices on many products that Americans buy, making our current inflation worse, the exact opposite of his campaign promise.  Many businesses, including the automotive sector, will be adversely impacted, forcing them to raise prices and lay off workers.  Between a blow to the stock market, inflation, and increased unemployment, we’re looking at increased odds of an all-out recession and/or a period of stagflation.  Trump admits we could be in for short term pain, but it’s highly questionable whether there will ever be any gain!