“If he returns to the White House,” Bloomberg reports, “Donald Trump has pledged to enact a 10% across-the-board tariff on imports that he says will raise billions of dollars in revenue to pay for more tax cuts.” He’s even floated the idea, per CNBC, of an “all tariff policy” and elimination of the federal income tax.
Think tanks of pretty much every stripe — from the “left-wing” Center for American Progress to the “centrist” Peterson Institute for International Economics to the “libertarian” Cato Institute agree: The math doesn’t work. It would take some pretty insane tariff levels to “pay for” elimination of the income tax. And you’d likely pay more in tariffs than you used to pay in income tax.
Republican National Committee spokesperson Anna Kelly wants you to believe that “the notion that tariffs are a tax on US consumers is a lie pushed by outsourcers and the Chinese Communist Party.”
She’s the one who’s lying. “Protectionism” doesn’t “protect” you — it protects the revenues of domestic businesses with friends in Washington, and it does so at the expense of anyone and everyone who buys the “protected” items.
A 60% tariff on a $1 Chinese item means you either pay $1.60 for that Chinese item … or $1.59 for the American version that used to cost $1.29 (if American companies bothered to make it at all). Tariffs make you, and foreign manufacturers, poorer so American manufacturers can get richer without having to compete for your patronage on price.
But let’s get to a bigger lie: The notion that tax cuts have to be “paid for.”
When a politician uses that phrase, he or she means that if the government isn’t taking a dollar from you, it must get that dollar somewhere else.
That’s not a “cost.” The dollar in question doesn’t belong to the government in the first place. It’s a dollar the government wants, not a dollar it has.
If I don’t break into your car and steal your stereo, I don’t have to find a way to “pay for” not having your stereo. My lack of a stereo is not a “cost” to me. It’s just you keeping what’s yours instead of me taking it.
Then there’s the biggest lie: The notion that “tax cuts” are really even on the table.
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The only way for taxes to go down is for spending to go down … and the politicians bragging about “tax cut” proposals clearly have no intention of reducing their spending.
The “national debt” stands at not quite $35 trillion, with another $2 trillion to be added this year. Every dollar of debt and deficit represents taxes the government has promised to take out of your hide, and your descendants’ hides, in perpetuity, with interest. It’s just another tax, with payment partially deferred.
Government spending is a lot like the three-card monte card, without the prospect that you’ll even occasionally be allowed to win. And Trump’s proposals are just another variant of that game, not a plan to reduce the amount he and his cronies steal from you.
Thomas L. Knapp (Twitter: @thomaslknapp) is director and senior news analyst at the William Lloyd Garrison Center for Libertarian Advocacy Journalism (thegarrisoncenter.org). He lives and works in north central Florida.