The most profound, harmful and unnecessary economic error

I finished the March/April issue of Analog Science Fiction and Fact. I read the six issues I get in a year, but usually don’t blog about them because it would be hard for me to say much about the two dozen stories and articles and hard for anyone else to get a copy by the time I’ve read it. However, in this issue I thought the editorial made some points worth sharing. It is online, though the link shows that it will be online only until the next issue is published, which may be in a week. The editorial is “Seeking Scientific Common Ground, Even On Guns” by Richard A. Lovett. The debate on guns seems to cycle at every mass shooting, with nothing changing. How can we break the cycle? One way is to look at the points (usually small) on which both sides can agree. And to do that we need data-driven research. The Centers for Disease Control had been restricted from doing this sort of research (and under the nasty guy will be restricted again). But academic researchers could and did (though that may also be banned now). One study in California compared the addresses of gun purchasers with addresses of shooting incidents. That showed people in households with guns were 2.33 times more likely to die from gun violence and the victim was typically the wife or domestic partner of the gun owner. RAND released research in 2023 showed evidence of consequences of three types of gun laws. Restricting a child’s access to parents’ guns reduces the chance of the child being shot by the gun. A stand-your-ground law increases gun violence because the law gives permission to shoot when one feels threatened, even though one could flee. Concealed carry laws increase gun violence, but in an unexpected way. When one has permission to carry a gun and wants to go to a place that forbids guns they leave the gun in the car. And they forget to lock the car. And the gun is stolen. Gun thefts rise when concealed carry laws go into effect. Maurizio Porfiri of New York University’s Tandon School of Engineering found that gun sales go up after a mass shooting because of a fear of new laws that might restrict gun purchases. His team also found there is one group of people who commit mass shootings for the fame. To get that fame they go for unusual settings and they innovate. The antidote is minimize use of the shooter’s name and reveal as little of the attack as possible. Yeah, media and the public don’t like that idea. They want the juicy details. With research we know more about how to prevent deaths buy gun. In a right to carry state that might include reminders to lock your car when you leave your gun in it. The big news today is the nasty guy’s “Liberation Day” – the imposition of tariffs on close to every country in the world, then what happened in response. Oliver Willis of Daily Kos reported on the actual announcement. The speech was “rambling” and included “debunked conspiracy theories.” It again showed he doesn’t understand the effects of tariffs or much about economics. One country notably missing from the list is Russia. And he again complained the 2020 election was stolen. As near as anyone can figure the reason why it is “liberation day” is that it marks the liberation of dollars from American and world wallets and retirement accounts as prices go up and stocks go down. I saw a lot of cartoons showing exactly that. TheCriticalMind of the Kos community gives the history of income taxes and tariffs, and what the nasty guy got wrong. In the early years of the US the federal government was funded by tariffs. An income tax was first considered in 1812 and enacted 1861-1872. In 1906 President Teddy Roosevelt called for inheritance and income taxes. President William Howard Taft called for them again in 1909. The 16th Amendment authorizing income taxes was ratified in 1913. The Great Depression began when the financial markets collapsed in October 1929. The Smoot-Hawley Tariff Act in 1930 made the depression worse. President Franklin Roosevelt saved the nation (by canceling Smoot-Hawley – the article isn’t clear). And the economy recovered going into WWII. Parts of the nasty guy’s speech is repeated. I’ll leave it by saying the nasty guy got the year of the 16th Amendment right. Nothing else. Emily Singer of Kos reported that four Republican senators – Murkowski, Collins, McConnell, and Paul joined Democrats in voting for a resolution that terminates the national “emergency” that the nasty guy is using to justify the tariffs. That “emergency” is the false claim of fentanyl coming from Canada. This resolution is in response to the 25% tariffs on Canadian imports, so doesn’t include the worldwide tariffs imposed yesterday. The Republican controlled House is unlikely to consider the resolution, and if it did the number of Republicans who might vote for it is unknown. Also, the nasty guy verbally attacked the Republican senators that voted for it. Dartagnan of the Kos community discussed the article by the editors of the Economist condemning the tariffs. From the Economist:

It’s hard to know which is more unsettling: that the leader of the free world could spout complete drivel about its most successful and admired economy. Or the fact that on April 2nd, spurred on by his delusions, Donald Trump announced the biggest break in America’s trade policy in over a century—and committed the most profound, harmful and unnecessary economic error in the modern era. ... Almost everything Mr Trump said this week—on history, economics and the technicalities of trade—was utterly deluded. His reading of history is upside down. He has long glorified the high-tariff, low-income-tax era of the late-19th century. In fact, the best scholarship shows that tariffs impeded the economy back then. He has now added the bizarre claim that lifting tariffs caused the Depression of the 1930s and that the Smoot-Hawley tariffs were too late to rescue the situation. The reality is that tariffs made the Depression much worse, just as they will harm all economies today. It was the painstaking rounds of trade talks in the subsequent 80 years that lowered tariffs and helped increase prosperity.

Dartagnan wrote that many feel these tariffs will be temporary. As the stock market crashes (and it made an excellent start at that today) cooler heads will prevail. But the nasty guy made sure this time around his administration is full of of loyalists, selected for the purpose of not telling him his ideas are catastrophic. The Economist counsels other nations to build up their trade by seeking saner trading partners and be cautious in their retaliation which would cause the nasty guy to double down. They’ll do it anyway to please their people. Dartagnan noted the nasty guy said that other countries will cave to his demands and open factories in the US. That’s preposterous – Vietnam and Indonesia have no interest in moving their manufacturing base here. He concluded:

There is no favorable outcome for Americans with these tariffs. None. It’s all bad, a wholly pointless, self-inflicted wound, apparently all premised on the irrational whims of someone whose own horrendous business record should have prohibited him from ever leading this country in the first place, let alone implementing its economic policies.

Willis reported on some world leaders condemning the tariffs. He concluded:

The entire world, including Americans, has given a thumbs down to Trump’s tariff tirade. Only Trump, his inner circle, and most of his Republican allies seem to think this will all work out.

After writing yesterday that the intent of DOGE is to make the US government unable to function so that government functions would have to be turned over to private companies, these tariffs got me thinking. Will crashing the economy in the US and around the world help corporate takeover? It will definitely have one effect: Rich people like the nasty guy and Musk live to oppress the lower classes so their lives look better. And crashing the economy will definitely oppress the lower classes. In a pundit roundup for Kos Chitown Kev quoted several pundits discussing the tariffs. I’ll summarize the points made by Josh Marshall of Talking Points Memo. His first point: Presidents have power over tariffs only because Congress delegated it and only during emergencies. Congress can take that power back. The Republican Congress could end this tonight, so it is on every one of them. Marshall’s second point: The huge stock market drop after the tariffs were announced both makes sense – this will be a big shock to the economy – and is weird – the nasty guy had talked about the coming tariffs for weeks and had been quite specific about them. “This suggests the equities markets are still in the grip of quite a bit of magical thinking, especially about Donald Trump.” Sebastian Strangio of The Diplomat explained how the per country tariffs were calculated. The nasty guy said they were “reciprocal,” a word he used a lot. But the tariff rates are not based on the tariffs other countries have placed on US products.

As numerous observers have already noted, the tariffs that the administration claims have been imposed on U.S. goods correspond to the nations’ current trade surplus with the United States, expressed as a percentage of these nations’ total exports to the U.S. ... (The White House later appeared to confirm this.) The fact that the administration has passed this off as a “tariff” rate, and then used this as the basis for the imposition of so-called reciprocal tariffs on other nations – in most cases the latter seems to have been calculated simply by halving the former – is a sign of spectacular mendacity and incompetence. As Mike Bird of The Economist noted on X, the fraudulent way that the tariffs were calculated is “almost a worse signal than the tariffs themselves.”

Kate Lyons and Nick Evershed of the Guardian:

Heard Island and McDonald Islands, which form an external territory of Australia, are among the remotest places on earth, accessible only via a two-week boat voyage from Perth on Australia’s west coast. They are completely uninhabited, with the last visit from people believed to be nearly 10 years ago. Nevertheless, Heard and McDonald islands featured in a list released by the White House of “countries” that would have new trade tariffs imposed.

Those islands take so long to get to because they are near Antarctica. While there are no humans, there are lots of penguins. Parish Dave and Louise Matsakis of WIRED reported that the Manufacturing Extension Partnership (MEP) was created by Congress to help small American manufacturers to grow. On Tuesday the nasty guy told Congress he’s withholding funding for some MEP centers.

The Democratic congressional aides and heads of MEP centers in multiple states believe that abandoning support for the program runs counter to Trump’s long-standing goals of boosting domestic manufacturing and winning the ongoing trade war with China.

Don Moynihan of the “Can We Still Govern” Substack discussed Musk and his heavy investment in the Wisconsin Supreme Court race. The quote concludes:

The stakes could not be higher. If Musk won, his combination of unlimited money and social media dominance would appear unbeatable. But his loss signals that money and messaging cannot dominate the deep and growing sense of dissatisfaction with the direction of the country, and with Musk in particular.

Down in the comments are lots of cartoons about the tariffs and Musk’s loss in Wisconsin. Also: Leia BlueSkywalker posted a meme: “I don’t want Canada or Greenland. I want PBS, Social Security, and the Smithsonian.” A meme posted by exlrrp quoted President Ronald Reagan from 1988. “When Congress passed the Smoot-Hawley tariff in 1930, we were told that it would protect America from foreign competition and save jobs in this country – the same line we hear today. The actual result was the Great Depression.” Way down in the comments is a cartoon posted by paulpro. It shows two buttons, one labeled “Trans people are too weak to be in the military.” The other is labeled “Trans people are too strong to compete in sports.” A transphobe is in a sweat over which button to push.