Friday, November 22, 2019

The Purpose of Tariffs

A few days ago Dean Baker wrote a piece declaiming the evils of tariffs. He is an economist, and should have been taught the value of tariffs as an economic protectionist tactic, and that our government has used them many times in the past 200 years, but apparently he skipped that part of class. I left the following comment on his piece.

Yes, tariffs raise prices on imported goods. That is their purpose. They do not raise prices on goods made in this country. That means that tariffs make domestic manufacturers competitive with cheap imports produced by low cost foreign labor, thereby benefiting workers who make those products in this country.

I am one of those workers. Back in the 1960s the American steel industry was being hurt by low quality steel imported from Europe, mostly from Poland, and sold at low prices. The government finally imposed tariffs on that imported steel, making high quality American steel competitive, and my job was saved.

Yes, the American consumer pays higher prices. They are doing so to support well paid, meaningful manufacturing jobs for their fellow citizens. You get what you pay for.


Dean Baker removed the comment from his blog.

(Yes, President Trump's comment was ignorant, in that it wrongly states the benefit of tariffs. That does not make Baker's response logical or reasonable.)

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