Yes, Tariffs Make Stuff More Expensive, But Sometimes It’s Worth It

1. The possibility of putting a significant portion of our unemployed back to work and allowing them the dignity of self-support (with a small boost from government policy) is a political good that must be seriously weighed against the benefits of a freer trade environment.
2. We must remember that every political question—including about whether a given tariff is justified—involves balancing all the costs and benefits involved, not just the economic ones.
3. On the other hand, free trade advocates have repeatedly pointed out the well-established fact that tariffs are economically harmful, thus concluding they should be eschewed.
4. On the one hand, we can take for granted that tariffs are always economically harmful—except, of course, that even from an economic perspective they can be beneficial if used as a temporary negotiating tool to get other countries to, say, lower their own tariffs.
5. Both sides of the argument, however, share a common flaw: They have almost universally assumed that whether tariffs should be imposed is an economic question.
6. Tariffs hurt foreign sellers because they must sell fewer goods at a higher price or cut into their profits to pay the new tax (in practice it will be some of both).
7. Foreign policy is just a special case, however, of a more general principle: Tariffs can be justified when they do more good than harm.
8. If some tariffs can serve as a form of welfare, replacing transfer payments with jobs, and thus avoiding many of the dependency-related problems that accompany direct aid, they may prove to be a healthy policy solution in an imperfect world.
9. Like war, tariffs impose economic costs, but can also be useful—and less drastic—instruments to apply international pressure.
10. Hartley’s article, “Just Tariff Theory,” began by acknowledging that tariffs are economically harmful.
11. The political goods that a tariff may achieve must be taken into consideration when deciding whether it is justified.
12. Tariffs are harmful because they are taxes that burden free trade.
13. Consider: Economic models assume that all human beings are fully rational maximizers of their own economic benefit—if a person’s industry is superseded by foreign imports, that person will switch to a different industry and continue to work productively.
14. The economic impact of a tariff is a relevant consideration, but so are other, noneconomic goods.
15. Thinking in these more political terms nuanced terms is vital if the United States is to adequately pursue its interest and duty in the area of tariff policy.

https://thefederalist.com/2019/06/19/yes-tariffs-make-stuff-expensive-sometimes-worth/