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free trade & free markets international affairs tax policy U.S. Constitution

Legal Trade War

Donald Trump’s imposition and changing of tariffs, all by his lonesome — without Congress — vexes more than a few critics.

His authority to do this, however, derives directly from laws passed by Congress.

The U.S. Constitution gives Congress the power to “lay and collect Taxes, Duties, Imposts and Excises” under Article I, Section 8, which includes tariffs, since they are taxes on imported goods. But Congress has legislated hand-​offs to presidents, allowing significant flexibility on tariffs.

The idea seems to be that, as Commander-​in-​Chief, the president should handle trade because … like war, it has to do with foreign countries.

Laws allowing presidential discretion include Section 232 of the Trade Expansion Act, Section 301 of the Trade Act of 1974, and the International Emergency Economic Powers Act of 1977. 

The first says that the president has broad discretion to define as threats to national security all sorts of things and then impose tariffs and other trade restrictions in response.

The 1974 legislation authorizes further along Trump’s favored line, the power to retaliate against “unfair” foreign trade practices.

The IEEPA grants sweeping powers in a declared national emergency.

So if free traders and others are alarmed at Trump’s seemingly dictatorial powers regarding tariffs, it isn’t new. It has been built into the Imperial Presidency. While Congress could take its constitutional authority back, there is certainly no groundswell to do so.

Also not new?

What setting up high tariffs have historically done: elicit similar tariffs in retaliation. 

Yikes: the kind of trade war that made the Great Depression “great.”

This is Common Sense. I’m Paul Jacob.


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The Real Free Trade Problem?

Trump Derangement Syndrome is not a mysterious disease. He triggers people for reasons. Still, there is no excuse for smart folks to fool themselves into misunderstanding his sometimes genius.

Take the subject of yesterday’s Common Sense, trade protectionism. Trump is plain speaking on this issue, and it is all-​too-​obvious that Trump harbors old autarkist notions of trade: it’s as if he resents having to pay foreigners for anything

His apparent resentment of benefiting others — alien others — is what’s so ultra-​right-​wingéd about him, and why leftists instinctively hate him.

And it’s why many free trade economists regard him as a complete and utter moron. His basic attitude appears to be that trade that benefits The Other must hurt us, and that’s just plain wrong.

But sometimes traders do aim to harm us.

This is where Trump’s attacks on trade with China make more sense. For when we deal with China, we don’t just make Chinese workers and businesspeople stronger, we make the Chinese State stronger — most particularly, the Chinese Communist Party. And that organization has set itself as the enemy not only of the United States but also of all competing states … and the very idea of individual freedom.

Free trade is great, because voluntary trades make both sides better off, and all sides are positively advantaged even when many participants are out-​competed and required to re-​tool, re-​group, and re-invent.

Yet, free trade with those who seek to destroy you is quite problematic. And this is not often figured into the elaborate reasoning offered by free-​market advocates.

Trump instinctively knows this, looking warily at those who would use the strength they gain from their people’s trades to transform market power into military power. There exist free traders who think this cannot happen. They are wrong. 

The point is to recognize threats and defend ourselves while also embracing the mutual benefits of trade whenever possible.

This is Common Sense. I’m Paul Jacob.


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The 51st State?!?!

“What I’d like to see?” confessed the president. “Canada become our 51st state.”

Why?

“We give them military protection,” he offered. 

Then things got weird.

“We don’t need them to build our cars,” Donald Trump added. “We don’t need their lumber. We don’t need them for anything.”

Shocking? Yes. But not just for the disrespect shown to our northern neighbors. 

What’s most shocking is our president’s ignorance of economics. While we don’t “need” Canada for any of the things Trump mentioned, we’re better off trading with Canada than not. The sending of “billions of dollars” up north is neither charity nor waste; the gains both sides make are apparent in the voluntary trades themselves. 

It’s as if he thinks if “we” must pay anyone, it should be to ourselves, that is, to our fellow countrymen.

Behind this is that old crank notion, protectionism: “we have big deficits with Canada, like we have with all countries.”

Now, it’s true that Canadians send more raw materials to the U.S. than we send to them, and that we send them more dollars than they send us theirs: that’s what “trade deficit” means. 

But how is this bad for us? 

Trump doesn’t explain. “I look at some of the deals made and I say, ‘Who the hell made these deals?’ They’re so bad.”

Mr. Trump identifies no specific trade rules or agreement; he doesn’t say which are unfair, or why; nor does he say who made them. But the trades that pile up to that overall deficit, each was made by Americans and Canadians who thought the deal best for them.

Trump’s seemingly goofy idea of adding Canadian provinces to the U.S. as new states would have one great benefit: more trades with these good people than ever. This belies Trump’s far, far more troublesome notion that we need nothing from Canada. We need everything. As Canadians do.

That is, freedom.

This is Common Sense. I’m Paul Jacob.


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Age of Arms

While it is entirely reasonable to treat children and adults differently, and for laws to reflect this basic division, questions of precisely when children should become adults have eluded rationality. 

In Argentina, where the legal age to vote is 16, young people may join the military at age 18, but had to wait till 21 to own a gun. 

Until Argentine president Javier Milei’s reduced the minimum age to purchase and carry a firearm to 18, a step towards greater consistency.

But that is not how the culturally dominant left-​wing media and intelligentsia see it. They paint dire dystopian visions of violence as a consequence of Milei’s libertarian pro-​carry, pro-​armament philosophy.

 A December article in The Epoch Times shows that this old, elitist attitude is falling to the wayside as “Residents of Argentina’s Crime-​Ridden Cities Welcome Milei’s Gun Reform.”

Key point? Dire dystopia is current reality.

Years of inflationism, government growth and regulation, as well as the seemingly endless political struggle between communists and Peronistas, has left a rising rate of homelessness and poverty.

And the homeless are getting grabby. 

In public. 

More daring and violent everywhere.

Against this, the pre-​Milei government’s soft-​on-​criminals approach left normal people feeling defenseless. So gun ownership has understandably increased. The Epoch Times quotes a Buenos Aires resident who “believes that the public’s attitude toward firearms ownership is shifting away from the notion of less guns equals less gun crime, an ideology that was promoted by the previous administration.”

While Javier Milei’s program to reduce inflation appears to be on course, Argentina has been so dystopian for so long, most changes for the good will be incremental.

Like setting the age to carry firearms to equal the military service age.

This is Common Sense. I’m Paul Jacob.


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Exit Trudeau

America’s far-​north (and far-​left) autocrat, Prime Minister Justin Trudeau, is resigning.

His resignation may pertain to the fact that opposition parties promised to vote no confidence in Trudeau’s Liberal Party when the Canadian parliament meets in March.

Associated Press says that critics complained of Trudeau’s efforts to “strike a balance between economic growth and environmental protection,” i.e., sacrificing economic growth to environmentalist hobbyhorses. 

Critics have many other complaints too.

What’s the worst of Trudeau’s conduct and policies? Tough call. But his treatment of the Canadian truckers who launched a Freedom Convoy to protest Canada’s ludicrous COVID-​19 mandates has to be near the top of the list. Among other measures, Trudeau froze the bank accounts of protestors — and even those of some supporters.

GoFundMe cooperated by blocking donations to the truckers and even, briefly, declaring that blocked donations would not be returned to donors who failed to make a special appeal but would instead be redistributed to “credible and established charities.” The outrage over the planned theft, even if perfectly in sync with Trudeau’s hooliganism, was too great, though, and GoFundMe reversed itself.

Trudeau is also one of many Canadian politicians who leapt into inaction as the Chinese Communist Party tested the limits of its ability to interfere in Canadian elections and politics and engage in transnational repression. I have discussed the problem here; and the sister site of Common Sense, StopTheCCP, has touched on it here and here and here and here.

Trudeau’s exit is good news for Canada and the free world. 

This is Common Sense. I’m Paul Jacob.


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international affairs

Dictator Down

After 13 years of civil war, a rebel force seized the Syrian capital over the weekend, toppling more than half a century of the Assad dictatorship, with despot Bashar al-​Assad fleeing to safety in Russia. 

Good riddance. But what next? Will any semblance of freedom come to Syria and be sustained? 

“Syria is a mess,” President-​elect Donald Trump posted on his Truth Social platform, concluding: “THE UNITED STATES SHOULD HAVE NOTHING TO DO WITH IT. THIS IS NOT OUR FIGHT. LET IT PLAY OUT. DO NOT GET INVOLVED!”

He’s not wrong.

Still, events in Syria add to the foreign policy challenges, increasingly military challenges, awaiting the new administration — from the war in Ukraine, Lebanon, Gaza, to the threat of Chinese aggression across the Taiwan Strait against economically and geographically strategic Taiwan. 

Or conflict might erupt in the South China Sea — a body of water that China claims more than 90 percent of … an outrageous, illegal contention, which nonetheless the PLA Navy increasingly enforces.

Recently, Chinese Communist Party leader Xi Jinping gave President Biden — meant for the President-​elect, of course — four red lines that America was not to cross. The first two are instructive: “the Taiwan question” and “democracy and human rights.” 

In short, it would be bad manners and really ruffle tender Beijing feathers were the U.S. to continue to arm and protect free, democratic Taiwan and to raise the issue of the numerous genocides the CCP regime continues to inflict on ethnic and religious minorities. 

And everybody else. 

It’s a dangerous world. Much of which the United States has pledged to defend. Good luck, Mr. Trump.

No wonder there is “a record high” percentage of Americans who “want the government to spend more on the military.”

This is Common Sense. I’m Paul Jacob.


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