In a post on tariffs, David Henderson pointed out a chart, created by Simon Lester at the Cato Institute, showing general tariff rates by country. On the chart, the US is on the lower side of the middle of the pack at 3.5%, which is hardly protectionist in my view.
I recall that in the waning years of his administration, Obama attempted unsuccessfully to negotiate a trade deal with the EU; and in comparing this tariff level chart showing that the EU level is more than twice that of the US to the reality of failed trade deal negotiations, speculation as to why EU negotiators would be motivated to strike a deal is only natural.
While I do not agree with Trump’s approach to “trade fairness,” in the context of tariff rate comparison, it can be sympathized with at a basic level. Thus my view of criticism of the policy from the other side of the Atlantic, that is highly emphasized in the press as “Trump’s protectionist trade war” with no mention of the context of tariff rates, is that it is nothing short of hypocrisy. The premise that if Trump wants to hurt his own people with trade taxes, it requires a response in kind by trade partners to hurt their own people with these taxes even more than previously is all around policy lunacy that solves no problem, and Forest Gump’s assessment that ‘stupid is as stupid does’ aptly applies to all involved – including Trump.
Alternatively, in the trade arena, there seems to be too much focus on the box of ‘what is’ and a serious lack of imagination of what could exist outside of that box.
I am one shrewd cookie when it comes to purchases of any magnitude, and I really shop around. There was recently a rather severe windstorm that blew through the region where I live. The houses in my neighborhood are all about 20 years old and the storm damaged many of the roofs including leaving a gaping bald spot on the back of my own. It was a complete nightmare to find a roofer who viewed me as the customer. For many of them, they were going to replace my whole roof and I was going to pay for it whether I wanted that or not. A gentleman from a company that replaced two of the roofs in my neighborhood thought I might be interested in his company’s services and gave me a quote for $12,475 just for the back. Astounded that my neighbors paid this much, I soldiered on and finally found someone who would do what I wanted for 10X less than my neighbors paid. I got it all done without being ripped off or adding unnecessary debt.
My point here is that if you don’t like the deal you’re getting, look for possibilities elsewhere. I can say that, as a matter of fact, trying to haggle and then argue with these roofers who tried to take advantage of my predicament got me nothing but wasted time, while moving on to match my needs and wants up with roofer with a better deal made us both happy.
On a much larger scale, economy-wide, in dismissing the raw deals and looking for other things to do in other places that are more trade-friendly, the possibilities are endless; and promoting the possibilities is a healthier policy fixation by far. One does not have to be nasty and get into a fight over ‘what is’ to come out on top. It just takes some imagination and creativity and the ability to empower people rather than tear them down.