One of Donald Trump’s signature achievements as president was a successful tax cut that slashed taxes for most Americans. But the former president is now advocating for the largest tax hike since 1968.
That’s right: Trump is promoting a new plan for a $330 billion tax hike on American consumers, via a 10% “tariff” on all imported goods from all countries.
“When companies come in and they dump their products in the United States, they should pay, automatically, let’s say a 10 percent tax,” Trump said during a recent Fox Business interview. “I do like the 10 percent for everybody.”
In Trump’s telling, this 10% uniform tariff would put up a “ring around the U.S. economy.”
Sorry, but there’s no polite way to put it: This policy proposal is batshit insane, and would wreak economic destruction at a time when Americans can least afford it.
Families are already facing high prices at the grocery store and on almost all their other essential expenses. And so, so many of the things Americans buy on a regular basis are either imported or produced by companies that rely on imported materials. They would all go up significantly in price very quickly were this lunatic plan ever enacted.
Of course, the supposed goal of this kind of protectionist policy is to help American companies. Yet whatever jobs would be “protected” in domestic industries by these tariffs would be far, far outweighed by all the jobs lost in industries that rely on imports which would surge in price. As a result, the nonpartisan Tax Foundation estimates that Trump’s plan, if enacted, would destroy 550,000 American jobs.
Higher prices and fewer jobs. Is that really what “Make America Great Again” means?
Even former Trump officials have criticized this idea.
“A tariff of that scope and size would impose a massive tax on the folks who it intends to help,” said economist Paul Winfree, who served in the Trump administration. “It would get passed along through higher prices at a time when the Federal Reserve has had difficulty limiting inflation.”
The plan was described as “lunacy” and “horrifying” by Peterson Institute for International Economics President Adam Posen. He further explained that it would be a boon to corrupt lobbying — you know, that “swamp” Trump (often accurately) rails against — because companies with the best lobbyists would immediately fight for special exemptions.
Republicans are supposed to support low taxes and free markets, not tax hikes and crony capitalism. But Trump’s latest plan is a betrayal of every principle that conservative economic policy is supposed to stand for.