but ones that punish an adversary,

No tariff has ever punished an adversary. All they do is raise the price of the goods. That is inflationary. At best, the pre-tariff price might fall a bit, and the higher post-tariff price might create a small drop in quantity sold in the US. But that just frees up product to be sold elsewhere in the world. (Refer to microeconomics to understand the price and quantity affect of tariffs.) Hardly punishing — annoying might be a better description.

Sometimes, a tariff can promote domestic employment. But we have only 4.something percent unemployment. That is remarkably low. So a tariff can’t help With that. If there is an attempt to increase domestic manufacturing, that will only add to inflation pressures as wages rise to encourage the already employed to switch jobs.

So I ask again, Michael, how do these tariffs help the economy?

—Peter

US Policy FAQ

---

Contact Shrewd'm
Contact the developer of these message boards.