Critics of Trump's tariffs are fearful of fear and baseless

Market analysts and so -called economists are afraid of Tariffs for President Donald Trump It should be at least somewhat relieved that he has agreed to pause the things he wants to impose on Mexico.

But they should not be worried in the first place, because their fear is incorrect. Trump understands the difficult reality of the situation: other nations have been abusing the United States for decades, and the US has been fought again for a long time. In fact, Trump's actions will benefit the Americans.

In the first place, the idea that tariffs are always and everywhere to consumers are a fallacy with economic theory and history. Factors such as change in the exchange rate means that foreign producers typically pay (or most) tariffs.

How the Trump tariffs used the hole used by Chinese retailers

We forget that in the golden age of America, the government was essentially supplying itself completely with tariffs. There was no income tax even. Instead of the untold economic catastrophe tariffs, they coincided with our fastest sustainable level of growth – when the middle class built the American.

But today, both our friends and enemies are abusing America alike International Trade And he weakens his potential for flourishing. For example, Mexico has worked with China to circumvent non -tariff tariffs and barriers (NTBS) on China and abuse of the Trading Regulations between Mexico and Canada. This makes US companies and American workers compete.

Syed tariffs for Mexico and China punishes these types of transactions and puts American exporters in a more playground. When asked about EU tariffs, Trump said he used the same game book, and so is so.

Mexico agrees to send 10,000 troops to the US border in exchange for pause

Many European countries use projects such as VAT (VAT) to impose implied tariffs on US exports. In addition, countries such as Germany and Japan still have tariffs that have been made after World War II to protect industries after the conflict. The status quo has changed completely, and there is no reason to continue the punishment of American farmers and factories.

Finally, we have a president who recognizes these facts and is implementing a carrot and wood approach to transform the international pattern in the United States. Trump simultaneously makes production overseas more expensive and hiring foreigners, while making domestic production and recruitment cheaper.

Detribution, lower marginal tax rates and plenty of energy are all helping to reduce production costs in the United States, while tariffs increase overseas production costs. How does this play?

China threatens to retaliate against Trump's tariffs

Consider Canada, whose leaders are shouting about Trump standing for Americans. If Canada agrees to eliminate its tariffs and NTBs, American exporters, such as dairy farmers, will be more competitive and sell more crops in Canada. This means doing more and hiring more Americans.

If Canada is stubbornly stubborn And the insistence on the trade war, then Canadian products will be less competitive and open the door for American manufacturers such as foresters to expand production and sell more in the country while hiring most Americans. Trump is putting an American worker to get out of the top.

As the economist Art Lafer points out, there is no winner in the trade wars, but the losses can face different losses. Almost all of Canada's exports go to the United States, but only a small portion of US exports to Canada. If the international trade between the two slowly slows down, it will lead to a severe stagnation in Canada but will be more like a quick speed for the United States

Trump imposes tariffs from Canada, Mexico and China: “National Emergency”

In short, Trump has all the cards. And he knows it.

But this is not just a matter for other countries to open their markets to American exporters. This is about a business deficit that cannot continue forever. Economic textbooks sometimes explain the deficit, pointing out that people often have a sloping business defect with retail stores, such as Walmart. Or AmazonAnd this does not cause bankruptcy.

While this is true, this unique business deficit is only possible in the long run because one has a surplus of extensive trade elsewhere, such as their workplace.

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The long -standing US deficit is provided by Federal ReserveThat is effectively printing money and sending it around the world to finance our elephant business deficit for decades. This trend has reduced the dollar over the years, so that the money of Americans will not go as far as it is not before – a phenomenon that we call inflation.

But the inflationary impact of our business deficit has been destroyed with the dollar status as the world's reserve currency. If we suddenly lose this, however, America may face too much bloodshed. For this reason, Trump has threatened tariffs on countries seeking to eliminate the king's dollar from their position in the world's monetary order – the rapid end of the dollar's currency will be catastrophic.

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Finally, Trump understands the “free trade”. If we really want free trade, then why do we only defend it in international markets? Why isn't domestic transactions either? In other words, if international trade tax is very bad, then why do we allow domestic business taxes – such as income tax, which is a workforce tax?

Free trade must be applied before Domestic trade Since we have to focus on the benefit of our citizens before we are worried about it abroad. We don't hate aliens – we just love Americans more.

EJ Antoni, a public asset economist, Richard F. Professor is a colleague at the Heritage Foundation and a senior colleague at Onleash Prosperity.