Trump has signed an executive order for tariffs increase. (Reuters: Kevin Lamarque)
Introduction: An era of freer trade made it possible for me to give new life to a dying refrigerator. Better for it to be of use in my garage than in a landfill. No freer trade, I junk the thing.
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No news here. President Trump proclaimed that his tariffs brought into the treasury $150 billion so far, by the end of July. His Treasury Secretary, Scott Bessent, projects $300 billion by the end of the year (see #1). The use of tariffs as a revenue generator is now a familiar part of Trump’s spiel. We’ve always had tariffs for a variety of well-worn reasons, but for most of our country’s history, a history without an income tax, tariffs were the chief source of revenue for Uncle Sam for all that the feds did at the time. Now we have an invasive income tax AND a new and ubiquitous tariff regime with a 15% floor covering most that enters the country thanks to Trump. The key lesson is our federal government’s insatiable appetite for more money to cover its still-growing $37 trillion debt, which just piles onto the backs of the citizens both the income tax and Trump’s tariff protectionism and its accompanying higher prices.
But who really pays the tariffs? In a display of economic illiteracy, Trump really believes foreigners pay. Read this display of historical and economic incoherence:
“In 1913 for reasons unknown to mankind, they established the income tax so that citizens, rather than foreign countries, would start paying the money necessary to run our government.” (see #2)
Is Trump advocating the abolishment of the income tax to make room for his “most beautiful word in the English language”? No, an end to the income tax appears nowhere in sight. Astonishingly, he actually claimed that foreign countries paid for our federal government. In the same breath, he and his Commerce Secretary, Howard Lutnick, contradict their logic by admitting price increases and fewer choices are the likely outcome.
Here’s Trump in an interview with Kristen Welker: “I don’t think that a beautiful baby girl needs – that’s 11 years old – needs to have 30 dolls.”
Here’s Lutnick in an interview with CBS’s Margaret Brennan advocating the avoidance of the tariffs by buying American: “[people who manufacture here] don’t pay a tariff. They don’t pay a tariff at all. So, President Trump says it all the time, build in America, you don’t pay a tariff.” And assumably you don’t have to worry about any tariff-induced price increases, or so says Lutnick (see #3).
The statements are incomprehensible. Trump doesn’t care that a margin of the buying public will be priced out of the market, and Lutnick fails to understand that a tariff raising the price of imports will lead to jumps in domestics as well. The price of the imported Toyota increases by $1,500 which leaves room for Ford to raise theirs by $750. The price floor is raised for all products no matter their country of origin (see #4).
Artificially raising prices alters behavior of all who confront them. Like me. Recently, my house refrigerator/freezer went on the fritz. It wasn’t cooling. The condenser coil was frosting over blocking the flow of air from the fan. The compressor is fine, so why the frost blockage? The defroster function clearly wasn’t working. The two most accessible parts in the defrost chain are the thermostat and defrost timer. Now began an online search for parts.
The price of parts varied dramatically for OEM (Original Equipment Manufacturer, possibly American) and the import (some from China). The price for the thermostat ranged from the OEM $60 to the import $8, and the defrost timer went from the OEM $120 to the import $22. Following the advice of the $3.37-billion in net worth Howard Lutnick or the $5-billion Donald Trump, versus the income of pensioners (my wife and I), they would have me pay the $180, which might not fix the thing. These guys could afford to junk the thing and shell out $1,500 for new, for two, maybe more. No big deal for them, one living in a $35 million Bridgehampton, NY, estate, and the other at Mar-a-Lago. For me, $30 makes the gamble worth it, which is what I did.
President Trump with Mar-a-Lago in the backgroundHoward Lutnick and his Bridgehampton, NY, mansion
It worked. “Buying American” would mean another appliance in the county landfill instead of one in my garage for ice cream and cold drinks.
That’s how economics works. Prices are signals to us and unleash incentives and disincentives for certain economic actions. Policies that artificially raise prices inordinately affect people at one end of the income margin while being meaningless to those at the other end. But those at the upper-income end seem to be making the policy.
Speaking of being out of touch. Trump portrays himself as the blue-collar messiah. No, he’s only a blessing to certain blue-collars – the ones with plenty of campaign cash and political pull – at the expense of other blue-collars. And for the rest of us, we must navigate a more difficult market. Unfree trade has its costs, big time.
RogerG
Sources:
1. “July tariff revenues break monthly record, with $150B collected so far in 2025”, Amanda Macias, Fox Business, 7/29/2025, at https://www.foxbusiness.com/politics/july-tariff-revenues-break-monthly-record-150-billion-collected-so-far-2025.
2. “’A little tough love’: Top quotes from Trump tariff talk”, France 24, 3/4/2025, at https://www.france24.com/en/live-news/20250402-a-little-tough-love-top-quotes-from-trump-tariff-talk.
3. “Transcript: Commerce Secretary Howard Lutnick on “Face the Nation with Margaret Brennan,” July 20, 2025”, CBS News: Face the Nation, 7/20/2025, at https://www.cbsnews.com/news/howard-lutnick-commerce-secretary-face-the-nation-transcript-07-20-2025/.
4. “Tariffs—Everything you need to know but were afraid to ask”, Adam S. Hersh and Josh Bivens, Economic Policy Institute, 2/10/2025, at https://www.epi.org/publication/tariffs-everything-you-need-to-know-but-were-afraid-to-ask/#:~:text=By%20raising%20the%20cost%20of%20foreign-produced%20goods%20or,goods%2C%20allowing%20domestic%20businesses%20to%20also%20raise%20prices.
Helicopter parenting seems to be a feature of some child raising today, may be an inbred reflex for older marrieds finally birthing one or two children. It comes with unforeseen costs which will be borne by the child later in life. The coddling cripples the youngster from developing the coping mechanisms and needed personality corrections when facing difficulties. Life disciplines if allowed to operate. The costs of leniency appear later when bail becomes necessary for storming federal courthouses, assaulting ICE agents, toppling statues and defacing cemeteries, and roaming around in mobs threatening free speech on campus. Mom and dad, get prepared for a hefty therapy bill as well. Coddled people are frequently nervous wrecks as adults.
The costs of coddling reach humungous levels when implemented on a national scale, such as showering subsidies, tax code benefits, and tariff protections on certain industries. Government becomes a helicopter parent, permissive and indulgent, enticing their dependents to continue in their morbid obesity and gross wastefulness. Who ultimately pays? Guess what . . . You!
Does any of this make any sense? “Yes” to the recipients, and “no” to everyone else. The more important question is, do our elected poohbahs wallow in this form of bad parenting on a national scale? Yes, because it pays. It buys the votes of people nostalgic for a world before the latest innovation. It goes something like this: my dad worked on Chevies, Fords, and Dodges, and that’s how God created the world. Who doesn’t want to freeze in amber the world of their formative years? Luddites of every generation will always be a potent political constituency.
The application of economic laws (supply, demand, price signals, incentives, etc.) to government was explored by economists Gordon Tullock and James Buchanan in something that they called Public Choice Theory. Surprise, they showed that politicians shop around for votes. They won the Nobel prize in economics for their groundbreaking work. Tullock took the analysis further by examining the immense hidden costs of tariffs; something Trump refuses to understand (see #1, #2).
Tariffs coddle the too-big-to-fail companies and their extortionate union parasites, both with their tentacles deep into the campaign war chests of the elected. Then, once in office, the bennies roll in, now especially under Trump. Trump’s most beautiful word in the English language, tariff, acts as an accelerant for a new growth industry, special consultancy services (tariff brokers and such) to help business navigate the new flood of paperwork and rules, and army of new government hires, regurgitated out of Leviathan. These services aren’t free, and add new costs to the bottom line and the public purse, all to be borne by you in fewer choices, higher prices, and higher taxes and/or public debt.
Think about it, think about a time before the income tax. Yes, there was a time when April 15 was just another spring day, and not the deadline to avoid fines and jail. It used to be the natural order of things, except for the brief period of the Civil War, until 1913 and Woodrow Wilson signed the implementing law after the 1909 approval of the 16th Amendment allowed the monstrosity. After it and other changes to the tax code, who doesn’t need a tax accountant to steer clear of the maw of the IRS? Many, many. The government’s insatiable appetite for more money added a new layer to the cost of living, the professional tax accountant and lawyer and software.
Trump is accomplishing the same feat with his “Liberation Day”. That and all the subsequent trade deals will end up spiking the average U.S. tariff from a low of 2.5% in 2024 to over 5% in 2025, and a general 15% on a huge portion of it (see #3). It’s a flat-out tax increase added to the bottom line, added to your cost of living and running a business. Trump boasts of billions pouring into the federal treasury as if it is coming out of the pockets of foreigners. He’s selling a falsehood. Much analysis has been devoted to who pays the tariffs (see #2). It shows the residents of the authoring country footing the bill. I don’t think Trump cares because tariffs are “beautiful” to him; they harken him back to a time 70 years ago, the world of his youth, and his obsession with recreating it.
The sheer absurdity of Trump’s tariff regime will be clear if we take a look at one industry, copper. You know, the hotly sought-after basic and essential stuff for the Dems’ greenie electrified utopia or Trump’s buy-only-America one. It’s a classic case of a blockheaded Trump obsession mucking up U.S. industries by pushing a solution in search of a problem.
Let’s start with a basic stat: 45% of U.S. copper consumption is imported (see #5). The remaining 55% is domestically produced. So, why the 50% tariff on imported copper? Intended or not, Trump is forcing domestic users of copper to pay more for it out of a constricted internal supply. Why constricted? Over decades, we willed it so. Try to open a new mine and avoid the stinging swarms of eco-zealots at all levels. Behind walling off the richer seams behind national monuments and lines of legal-eagle firing squads, the potentially condemned seek other venues of investment. 55% could be a lot more but isn’t because we’d rather pay to dig up the land under other people. Currently, the U.S. ranks seventh in proven reserves in the world, more than China, but won’t touch much of it (see #5).
And, anyway, it’s not such a bad idea to diversify sources for national security reasons. Domestic supplies can be disrupted by events such as strikes by Trump’s newfound allies in organized labor’s extortion racket. Natural disasters and mechanical breakdowns in the chain from mine to mill, as happens in oil refining, are inevitable. Is it such a horrible thought to be on good terms with countries like Chile, our largest foreign source? Though, If you see foreigners as enemies, like Trump, economic or otherwise, don’t be surprised that many of them end up providing new naval basing and investment opportunities for the CCP. Tariffing our hemisphere will require a much bigger navy to blockade South America.
The bottom line is that coddling domestic producers behind the padded walls of 50% tariffs makes them more willing to buy off the eco-gangsters and their featherbedding union masters, a win/win for producer and parasites alike. The only loser is the DIYer trying to wire his garage. Maybe now, his only option is shivering in winter.
Coddling “Made in America” by federal helicopter parents is a surefire way to screw up people. It isn’t good policy in raising children nor in the making of prosperity.
RogerG
Sources:
1. If you want to get into the weeds of Tullock’s insight, read “The Welfare Costs of Tariffs, monopolies, and Theft”, Gordon Tullock, Rice University, June 1967, at https://onlinelibrary.wiley.com/doi/10.1111/j.1465-7295.1967.tb01923.x.
2. For a more concise depiction of Tullock’s thesis, go to “The Hidden Costs of Trump’s Tariffs”, Augustin Forzani, National Review, 7/31/2025, at https://www.nationalreview.com/2025/07/the-hidden-costs-of-trumps-tariffs/?utm_source=recirc-desktop&utm_medium=homepage&utm_campaign=right-rail&utm_content=capital-matters&utm_term=first.
3. “Trump Tariffs: Tracking the Economic Impact of the Trump Trade War”, Erica York and Alex Durante, Tax Foundation, 7/29/2025, at https://taxfoundation.org/research/all/federal/trump-tariffs-trade-war/.
4. “Chart: The Average U.S. Tariff Rate (1890-2025)”, Dorothy Nuefeld, Visual Capitalist, 4/10/2025, at https://www.visualcapitalist.com/the-average-u-s-tariff-rate-since-1890/.
5. “45%”, Dominic Pino, National Review Magazine, September 2025, p.11.
Rep. Alexandria Ocasio-Cortez and Sen. Bernie Sanders participate in a stop on the “Fighting Oligarchy” tour at the Dignity Health Arena Theater in Bakersfield, California, on April 15, 2025. (photo: REUTERS/Aude Guerrucci)Zohran Mamdani, NYC mayoral candidate. (photo: Angelina Katsanis for The New York Times)Pres. Trump announcing his “Liberation Day” tariffs, April 2, 2025
It’s probably always been true that shallow thinking prevails in our world. X good/Y bad, the binary pervades thought without much cognitive work behind it. What else explains the teenage rise of the now 22-year-old phenom Greta Thunberg (mentioned in earlier posts)? Or the overturning of the century-plus expansion and refinements of the grid and personal transportation in the crushing span of two decades, by law? Or the sudden appearance of sex shapeshifting as an incontrovertible “reality” taking over women’s swimming and track meets? Or sports gaming profits are a “good” without any recognition that these profits represent many more “losers”? Or, in a similar manner, a boost in government revenues from tariffs is a “good” absent any realization that they come at the expense of consumers and businesses, a much bigger class of “losers”? Our public conversation is chock full of the silliness. It’s the era of the shrill and shallow.
At the spearhead of this nonsense is a combination of the Trump phenomenon and the neo-Marxist Left in the Democratic Party and its street militias. The former first. Take Trump’s “Liberation Day” tariffs. The only thing being liberated is money out of our wallets and “freedom” from our beneficial supply chain arrangements. The confluence of “liberation” and rising economic distress is . . . amazing.
That won’t stop pundits like Hugh Hewitt on his radio show announcing the “good news” of higher-than-expected government revenues from Trump’s tariffs (last week). It doesn’t take much more than a thimble of reasoning to understand that, for instance, the MSRP of that new truck on the showroom floor just jumped $1,500, or Amazon deals are fewer and far between. When was the last time that you heard a self-proclaimed Reagan Republican extolling the virtue of a huge tax increase?
It doesn’t stop there. Trump’s on-again/off-again support for Ukraine stands out for head-scratching. Is Putin a good guy or bad guy, despite the fact that he wantonly invaded another country like the Wehrmacht did Poland. Is a dogmatic obsession with a “pivot to Asia (China)” the right way to go, even though crap happens elsewhere? In 1984, when asked by a reporter about the greatest difficulty facing a Prime Minister, British ex-PM Harold Macmillan responded, “Events, my dear boy, events.” Events are happening elsewhere that unexpectedly impact Trump’s much cherished “pivot”. Is it too much to expect of our leaders to understand that a green light to Putin is a green light to Xi, is a green light to the mullahs, is a green light to Kim? Empty grousing in the 1930s about Japan in Manchuria and Mussolini in Ethiopia was fully appreciated by the Chancellor of Germany. Dominoes exist in more than a game.
Many of Trump’s political successes is less evidence of him playing 4-D chess but is, more than anything, proof that he’s blessed by the sheer incoherence, incompetence, and malignancy of his opponents. Popular loathing for the donkey party is at record highs according to the latest WSJ poll (see #1). Are election results a product of an overwhelming enthusiasm for a particular candidate or a measure of a greater dislike for the other choice?
Trump-love occupies a niche in the American public, far from sufficient to get him elected. Helping Trump along the way is an opposition party oriented for dystopia. No matter Trump’s negatives, the alternative has positioned itself as a catalyst for XX “boys” and XY “girls” throughout K-12 into college, education dysfunction, defund the police, the mutilation of the economy and the quality of life in green fads and inflation and mounting public debt, and urban wastelands of filth, crime, and homelessness.
Who, other than Democrats, wants an intermingling of genitalia in middle school bathrooms based on nothing but the hormone-fueled feelings of tweens? Mercurial teen self-identity leads to XY “girls” blasting through the tape by 4 yards at the girls’ state high school track championships. Of course, don’t look for it to happen the other way around (XX “boys” taking gold medals in competitions with the XY variety). The whole scene flummoxes and angers ma and pa and grandma and grandpa in the stands. Democratic Party infatuations suddenly hit home.
When Trump tariffs, the Dems are boxed in a corner. Trump proves that he can be just as good a central planner as they ever were. How can they complain? Ever since Republicans began to embrace their inner Milton Friedman in the 1960s, Democrats were the buddies of economic xenophobia and our extortionate labor unions. Trump flips the old political script, tossing freedom economics out the window, and proves that the GOP can function as economic xenophobes and gangsters every bit as well as the Democrats in their effusive pandering to the AFL-CIO.
What’s left of the old Democrat coalition? They’ve got their eco-lobby with its thinly educated white-collar and mostly public-employee constituency. Add to them the cadres of social revolutionaries led by old socialist crackpots like Bernie Sanders and the New Age socialism of the glib and juvenile AOC. Oh, let’s not forget the only expanding clump in their atrophying coalition: unmarried women. Husbands and children are not on their agenda, while preferring a government spouse to a biological one. The party’s future is even more depressing as they fling the LGBTQ+ agenda at the face of God-fearing Hispanics, flood the labor market with desperate peasants, and persist in abandoning the economic and social interests of Black males.
We have the rule of the shallow and shrill. Our primary elections are not faithful renderings of a party’s members, but a playground for the most animated, the shrill and shallow. The rest stay home. MAGA and the Democrats’ social revolutionaries present firebrands to the general public in November, or people who speak the lingo. American politics, as seen by outsiders, must appear to be riotous clown show. Interesting.
Speaking of the shrill and shallow, an update: President Trump and European Commission President Ursula von der Leyen announced a trade deal this past Sunday (7/27). After chores, and during exercise, I’ll listen to podcast and talk-show punditry and be exposed to the latest hyperbole about the deal. There’s too much we don’t know and too much yet to be negotiated. Yet, we do know to expect a jump in automobile and durable goods prices since tariffs on cars (15%) and steel and aluminum (50%) remains. Don’t forget that “tariff is the most beautiful word in the English language” for Trump. At least for now, till our potentate-in-chief changes his mind, some certainty returns to business. Stay tuned for more “progress” on the America-as-victim-of-the-world front.
RogerG
Sources:
1. “Democrats Get Lowest Rating From Voters in 35 Years, WSJ Poll Finds”, Aaron Zitner, Wall Street Journal, 7/25/2025, at https://www.wsj.com/…/democratic-party-poll-voter….
President Trump announcing his “Liberation Day” tariffs on April 2, 2025.
Javier Milei in a speech before the World Economic Forum in 2024: “If measures are adopted that hinder the free functioning of markets, competition, price systems, trade and ownership of private property, the only possible fate is poverty.” (see #1)
Donald Trump on his tariffs in April 2025: “You know, someone said, ‘Oh, the shelves, they’re going to be open.’ Well, maybe the children will have two dolls instead of 30 dolls, and maybe the two dolls will cost a couple of bucks more than they would normally. But we’re not talking about something that we have to go out of our way. They have ships that are loaded up with stuff, much of which — not all of it — but much of which we don’t need.” (see #2)
Is there a difference between Donald Trump and Javier Milei? Yes, an emphatic “yes”. Trump is a classic central planner with all the limitless self-regard that the position demands. Milei is reintroducing free markets to a country that has not had many for decades. With Trump, we get a person who asserts the power to determine how much we deserve and “need” and how much we should pay for it. Milei is dialing back Trump-style manipulations with impressive results. The other shoe has yet to drop in the U.S. on the fundamental disorder to supply chains from Trump’s economic illiteracy in his tariff campaign. Stay tuned, The Big Beautiful Bill or no, there are troubling signs in the consequential durable goods sector.
Argentina’s President Javier Milei attends the opening session of the legislative term at the National Congress in Buenos Aires, Argentina, March 1, 2025. (photo: Matias Baglietto/Reuters)
Let’s start with Milei’s Argentina, and add Poland’s rise to the mix. After decades of socialistic Peronism, Argentina under Milei is teaching a lesson to Donald Trump. Year-over-year, the nation’s economy has grown 7.7%. Poverty is beginning its downward slide. Milei has corseted government interference (for instance, ending rent control in Buenos Aires), cut spending, restrained the money supply, and eliminated many price controls. The result is an Argentinian renaissance.
Poland showed the way for Milei. In 1989, Leszek Balcerowicz, Poland’s Finance Minister after the shedding of communism, cut spending, balanced the budget, reigned in the money supply, ended many government spending programs, basically freed-up the economy, and Poland took off (see #3). It remained free of Brussels by not joining the euro. We would be happy with 3% growth in GDP. Poland is humming at 5%.
Where is Donald Trump leading the U.S.? In some ways, in the opposite direction. All governmental interventions are not equal in their effects. Some have greater impact than others. Supply chains are crucial. That which disrupts supply chains ripples down to layoffs, repos, and personal bankruptcies. After treating the U.K. like the CCP, one in which we amazingly had a trade surplus, Trump is targeting South Korea and Japan with 25% tariffs. It’s madness.
Expect showrooms and car lots to have fewer offerings in that industry of the most durable of all durable goods. No big deal for Trump, we only deserve two to choose from, right?
It’s all over the place, everywhere you look in automotive industry reports. Signs are abundant of a coming automotive industry recession. Quoting AutoForecast Solutions, industry insiders such as F & I and Showroom expects “light-vehicle sales will fall for the first time since 2022 due to uncertainty around the tariffs”. It’s a perfect storm of a Federal Reserve skittish about inflation and keeping interest at their current level, Moody’s downgrading of the U.S. credit rating, Conference Board Leading Economic Index’s fall of nearly 2% in March-April, rising loan defaults, etc. (see #4)
No wonder Trump is on a jihad against Fed Chairman Jerome Powell. Trump wants easy money to paper over the effects of his tariff war.
In putting makeup on the pig, President Trump and his spokespeople trot around citing normal manufacturing shifts (Mercedes, BMW, Honda, Hyundai, Kia, Stellantis and Toyota) that were planned and announced before Trump announced his America-the-victim-of-the-world tariff war, as if the resulting chaos is a stroke of genius. Trump should take this comedy routine on the road.
Buyers aren’t stupid. If people see price increases on the horizon, they buy while the getting is still good. The numbers are the numbers. The June auto sales numbers fell by 2.6 million from April to June. March and April were great because tariff reality would soon set in. Jonathan Smoke, chief economist at Cox Automotive Inc., put it bluntly: “The party is over.” This isn’t a mysterious happening according to Smoke: “It’s clearly slowing. It’s because of affordability getting worse and forcing what we think will be production declines to keep supply in balance.” (see #5) Translation: Think again about buying that new car.
The goal is reshoring. Laudable, but the method asinine. It jumps over the question of why they left. Is it merely the attractiveness of slave or peasant labor? Cheaper labor overseas has always existed and yet the country grew. What happened between then and now? We decided to muck up the works. By law and government interventions, we turned organized labor into an extortion racket. We taxed and regulated our way into near oblivion. We have greater difficulties in building anything. Try to build power plants, refineries, dams, mines, roads, power lines, even housing, in the good ‘ol USA. Home-grown NIMBYs and greenie revolutionaries have a greater influence on our economy than Malaysian peasants.
Conversely, we could tack in the opposite direction and make our country accommodating to industries. It’d be like the mysterious voice in Field of Dreams: “Build it (a free economy) and they will come.”
Instead, we have a president and his Republican Party fan club who’d rather throw up a wall, like a curtain, to hide the extortion racket and the government bludgeoning of economic activity, and then paste “Make America Great Again” over the mess. Jargon replaces accountability.
In that good ‘ol USA, central planners like Trump, not us, decided that we needed upscaled electric golf carts to replace our family sedan. Anything large powered by fossil fuels was to be pounded into dust by CAFE standards. The car industry played along because they’re essentially cowards. Hitching your industry cart to government and its activists, whether Friends of the Earth or MAGA tariff-enthusiasts, depending on who temporarily holds the reins of power, can be an economically unhealthy thing to do. Watch California become a Third World nation, er state.
And it shows in the crap foisted on us. It’s high-priced, underpowered, loaded down with gimmicks to mask their shortcomings (turbochargers); beset by stunts like cylinder deactivation, on/off engine disruptions during idling, the carbonization of direct fuel injection, the notorious 10-spead transmissions; and range anxiety coupled with spontaneous combustion of battery packs for those “virtuous” EVs.
At least The Big Beautiful Bill (BBB) corrected some of the folderol. The only problem is that we have a Donald Trump (DJT) intent on wreaking havoc on the guts of economic activity. What the BBB giveth, DJT taketh. Sounds like central planning.
RogerG
Sources:
1. Milei’s speech can be viewed in YouTube at https://youtu.be/4z44XP4u9Xs?si=OEB-mRfFMY2xts1U.
2. “Trump says children could have ‘2 dolls instead of 30’ with his tariff plan”, Alex Gangitano, The Hill, 4/30/2025, at https://thehill.com/homenews/administration/5275798-trump-says-children-could-have-two-dolls-instead-of-30-with-his-tariff-plan/.
3. “Shock Therapy: What We Can Learn From Poland”, Taylor Marvin, Prospect Journal, at https://www.prospect-journal.org/articles/2010/11/11/shock-therapy-what-we-can-learn-from-poland.
4. “2025 Auto Sales Slump Forecast”, Hannah Mitchell, F & I and Showroom, 6/3/2025, at https://www.fi-magazine.com/376082/2025-auto-sales-slump-forecast.
5. “Car sales plummet following pre-tariffs panic buying: ‘The party is over’”, Ariel Zilber, The New York Post, 7/1/2025, at https://nypost.com/2025/07/01/business/car-sales-plummet-following-pre-tariffs-panic-buying-the-party-is-over/.
6. An excellent synopsis of Milei’s success can be read at “The Milei ‘Miracle’ Is a Vindication of Free Markets”, The Editors, National Review, 7/8/2025, at https://www.nationalreview.com/2025/07/the-milei-miracle-is-a-vindication-of-free-markets/.
Yesterday (6/19/2025), Donald Trump announced a two-week reprieve for the mullahs. That’s dangerous. Many legitimate estimates put Iran at two weeks from a nuclear bomb. Two weeks is a rough assessment that can’t preclude one week or less, if rushed. If he succeeds, Khamenei will have the premiere blackmail weapon, or turn Tel Aviv into Hiroshima, before time runs out. Is Trump about to snatch defeat out of the jaws of victory? How did we get to this point? Well, partially, it’s the language, stupid! (Like in James Carville’s famous words from 1992, “It’s the economy, stupid!”). Read further.
Today, our overheated politics disfigure our language. In the Left, “top 1%” (billionaires), “men” (the “patriarchy”), “privileged” (anybody white or male or anyone able to escape the public schools for their kids), “heteronormative”, “…phobia”, et al, denote an evil presence. In the Right, specifically the MAGA universe, “establishment”, “elites” (which practically means anyone of high status in a demographic), “neocons” (the old Reagan coalition), “Wall Street” (shared with the Left), “globalists”, et al, are used to identify their meanies in the world. Each side has their jargon. Since MAGA and the MAGA-adjacent are in power, it’s their linguistic twaddle that presently holds sway in personnel choices and policy.
In MAGA world, the buzzwords lead to some really odd policies (a tariff war against the planet, the crude verbal abuse of allies) and personnel choices. Right now, an “elite” real estate developer, Donald Trump – one who hobnobs with “Wall Street” and “globalists” – makes some stylistically crude overtures to blue collars, essentially big labor unions, but also turns to buddies in his high-end real-estate social circles for statecraft positions and advice, people whose only real experience is in the cocooned transactional world of U.S. law and real estate, people like Steve Witkoff. Any criticism of these picks is dismissed by tarring these wayward voices with MAGA’s list of jargonized horribles.
The ancient Greeks wrote of hubris (excessive pride) leading to nemesis (retribution, bad happenings). Could the reliance on buddies, absent any real background in the field, with overconfidence in their abilities, lead to nemesis and catastrophic failure for the nation? One need only examine Witkoff’s résumé to understand the lurking dangers.
Who is Steve Witkoff? He’s a lawyer and real estate developer from New York, like Trump (see #1). He was Trump’s lawyer in the 1980s. According to Witkoff’s testimony in Letitia James’s New York civil suit against Trump, his friendship with Trump began in 1985. During this decade, he became heavily involved in real estate development. His sole interaction with foreigners was his 2016 effort to sell his group’s stake in the Park Lane Hotel project in the Central Park neighborhood. All his activities occurred under the aegis of American legal norms. The friendship with Trump endured through it all.
The result is a man totally out of his lane in international diplomacy. He succeeded in the release of a couple of American hostages in singular transactions that required no real sacrifice from malevolent actors (Hamas, Putin). These were important for their families, but are not evidence of any acumen in the momentous arena of international statecraft. As Trump’s travelling envoy, he’s been an embarrassment. Maybe that’s because he doesn’t realize that he’s been given impossible tasks in trying to broker deals in conflicts without middle ground. In one, Putin invaded another sovereign country, brutalizes its people, and can’t back down because of the heavy sunk costs in the effort. It’s either conquest or being overthrown and execution, always a strong possibility for dictators.
An isolated American real estate lawyer is a duck out of water in places not corseted by American legal norms. Additionally, he was given the job of bringing an end to the Gaza War. What made him think that a deal was possible between the victim of mass murder and the butchers of men, women, the old, and children, many burned alive? A level of fanaticism is at work that a real estate lawyer schooled in real estate deals cannot comprehend. He cannot envision that the side across the table from him isn’t united with him in common purpose, like making money. They’re goal is your demise, not anything like achieving mutual benefit under American contract law. These malcontents are cut from the same cloth as the 911 hijackers. Negotiating with them will get your throat slit, as many discovered on the planes during 911.
People who have cut their teeth in a lifetime of American real estate transactions run the risk of being ill-suited to handle the world’s cutthroats. Witkoff was stunned coming face-to-face with them; he admits it. At the Arab summit in March, he said about his discussions with Hamas (see #2),
“I thought we had a deal, an acceptable deal. I even — I even thought we had an approval from Hamas, maybe that’s just me getting — getting, you know, duped . . . .” (see #2)
Getting “duped”? After being “duped” by Hamas, Witkoff engages with Putin and comes away with, “I don’t regard Putin as a bad guy.” He then proceeded to sound like Putin’s Russia Today network endorsing Putin’s seizure of the Crimea and Ukraine’s eastern provinces (see #3). He then points to plebiscites in them, under Russia’s guns, to justify Putin’s declared right to rewrite borders at his whim. And, like a parrot out of the Russian Foreign Ministry, Witkoff blames NATO. Is this guy Putin’s ambassador to the U.S. or our envoy to Russia?
To be honest, he sounds like his partner in real estate, Donald Trump. Remember Trump’s Putin-like hammering of Zelensky in the Oval Office earlier this year? Repulsive, absolutely repulsive.
A transactional approach to foreign policy assumes a commonality of purpose that doesn’t exist. It’s easier if only money is at stake. Any other motive – ideology, religious fanaticism, an overriding sense of grievance – throws the transactional approach into the category of self-annihilation for the side not so disposed. Trump is transactional, and so is his special envoy. It’s stupid, it’s dangerous. Are we nuts?
RogerG
Sources:
1. Thanks for Jim Geraghty’s insights and sources in “The Fate of Israel and Iran Is in Steve Witkoff’s Hands”, National Review, 6/20/2025, at https://www.nationalreview.com/the-morning-jolt/the-fate-of-israel-and-iran-is-in-steve-witkoffs-hands/. I strongly recommend his Morning Jolt newsletter. Sign up at https://link.nationalreview.com/join/4rc/newdesign-nls-signup?
2. Thanks to Jim Geraghty for this source: “Trump’s longtime buddy testifies as defense expert in Manhattan fraud case”, Erik Eubelacker, Courthouse News Service, 11/14/2023, at https://www.courthousenews.com/trumps-longtime-buddy-testifies-as-defense-expert-in-manhattan-fraud-case/
3. “Steve Witkoff Says Putin Not a ‘Bad Guy’, Stumbles on Ukraine Geography”, Ellie Cook, Newsweek, 3/23/2025, at https://www.newsweek.com/steve-witkoff-ukraine-ceasefire-russia-mistake-regions-annexed-vladimir-putin-2049224
After the U.S. Court of International Trade (CIT) decided that the president does not have unilateral power to declare a trade war on the world, Stephen Miller, President Trump’s Deputy Chief of Staff, proclaimed (see #1), “The judicial coup is out of control.” What Millerite rubbish.
Miller’s feral reaction had resonance at a time when courts were inventing “rights” and making law out of whole judicial cloth. That was the time of the imperial judiciary, and rightly condemned. Not now, at a time of a 6-3 originalist, conservative majority.
Now, we’re in the era of new imperium, that of the imperial presidency. So, what do we call it when Trump with a stroke of his pen declares a trade “emergency” against the planet? The tariff power unquestionably resides with Congress in Art. I, Sec. 8. It’s nice to hear a court – The U.S. Court of International Trade – return to the literal, original, and simple meaning of the law and The Constitution. There is no place in our rule of law for Obama’s phone and pen, Biden’s edicts on rent moratoriums and student loans, and his wanton dereliction of duty to enforce immigration law, and now Trump’s decrees on tariffs on anyone, at any time, at any rate, for almost any reason – just declare an “emergency”.
But not so fast. The Court of Appeals for the Federal Circuit issued a stay (a stop order) of the CIT decision in V.O.S. Selections v. Trump to give time for the Trump people and the plaintiffs to present their appellate briefs.
Well, let’s clear this up right now. Who are the plaintiffs, the people who brought suit? They aren’t your typical eco-lefties or your run-of-the-mill identity group hustlers angling for more privileges and taxpayer-funded bennies. They are folks who have a conception of government more in line with the Founders, people who seek to have The Constitution applied as written. Their creed stems from James Madison, not Karl Marx. They are free market, limited government people.
Spearheading this suit against His Majesty Donald Trump is the Liberty Justice Center (LJC), not the ACLU or the radically leftist Southern Poverty Law Center. The Liberty Justice Center’s mission is to “challenge the latest and greatest threats to liberty across the country” and strives to “revitalize constitutional restraints on government power and protections for individual rights” (see #2). The LJC stepped up to the plate to defend VOS Selections (importer of wines and spirits), FishUSA (fishing tackle producer), Genova Pipe (producer of irrigation and plumbing supplies), MicroKits (producer of electronics kits), and Terry Precision Cycling (producers of bicycles and cycling accessories) to stop Trump’s tariffs from driving them into bankruptcy.
LJC is doing for them what they did for Mark Janus before the U.S. Supreme Court in the famous Janus v. AFSCME decision of 2018 which reaffirmed the freedom of an individual public employee to not join a union. Today, it’s the freedom to stay in business without having to face the existential threat of arbitrary and capricious actions of a national executive straying far outside his constitutional lane.
Trump relies on the International Emergency Economic Powers Act of 1977 (IEEPA), within the National Emergencies Act, in the same manner as the Democrats worship the Constitution’s commerce and necessary and proper clauses to bring down on our heads the bloated Leviathan, the same one that has jacked our economy, our lives, our national debt, our kids’ schools, our neighborhoods, our housing, our girls’ sports, etc. IEEPA grants to the president certain economic powers only during an “unusual and extraordinary threat” to the nation. Thus, Trump is sharing the same ideological space with AOC, Bernie Sanders, The Sierra Club, Friends of the Earth, Elizabeth Warren, The Squad, and Karl Marx . . . if he was still around to mingle in Democratic Party confabs.
So, what’s the “unusual and extraordinary threat” to justify the power grab, according to Trump? Think about it. The “emergency” lies in the commonplace business arrangements that have been around for the past 40+ years, if not longer. Now that’s odd: a 40-year-old “unusual and extraordinary threat”. At what point in a time span does “normal” suddenly become an “emergency”? If he wants to bring back those $17/hour factory jobs in droves, bring back his glorious 1950s, he ought to work with Congress to throw up the protectionist walls, shower taxpayer funds on a few favorites, and possibly muzzle the eco-predators that are actually busy making a hash of our economy. Policy is the proper response, not imperial ukases. But try to get that through a Congress of razor thin majorities. In other words, in our constitutional order, there is no mandate for Trump central planning.
Once we clear away the MAGA rubbish talk and get our bearings, governance by imperial whim is not becoming of Lincoln’s last best hope of earth. The sloganeering America First is verily America Ruined. The least that we can do to rescue our reputation as a free people of a free country is to retain some sense of the rule of law. Let’s hope that we have a Supreme Court who agrees.
RogerG
Sources:
1. “The Sudden End to Tariffs and the TACO Trade”, Jim Geraghty, National Review, 5/29/2025, at https://www.nationalreview.com/the-morning-jolt/the-sudden-end-to-tariffs-and-the-taco-trade/
2. Liberty Justice Center, “What We Do”, on their official website at https://libertyjusticecenter.org/about/
Legend has it, probably apocryphal, that George Washington’s Continental Army band played “The World Turned Upside Down” during the surrender ceremony of the British army after the Battle of Yorktown. A tune that was written to mock the Puritan parliament’s suppression of traditional Christmas festivities in the 1640s ended up expressing a historical truism: Give it enough time and things flip. For instance, the markers that defined the Left now are true of the Right and vice versa. It is profoundly true in this brief interlude called the Trump era.
Trump has abetted the rise of a sixties peacenik faction of the Right. The logic and thoughts of the Soixante-Huitards – radical Left, anti-War protesters who massed in Europe and America during 1968, the “peaceniks” – have resurfaced on today’s Right. The most recent example of the phenomena appeared a month ago on Joe Rogan’s podcast in a debate between Douglas Murray and Dave Smith. Watch it below, all nearly 3 hours of it.
If I closed my eyes, I could swear that I was hearing Tom Hayden or Abbie Hoffman or Rudi Dutschke (of “the long march through the institutions” fame) in the person of Dave Smith, the self-described libertarian and Donald Trump enthusiast. It’s de-ja-vu all over again, in an alternative universe.
Collage of the Sixties Radical Left
The confusion between generations that the situation engenders was aptly fictionalized in Rob Long’s tale of an imaginary surveillance transcript of two Harvard undergrads discussing their latest plans for an anti-Trump protest.
Rob Long
In it, they unwittingly sound like Milton Friedman and Ronald Reagan leaving their conservative fathers dumbfounded by their lefty sons’ embrace of free trade and Friedman in their outcry against Trump and MAGA. Here’s Long’s depiction:
************
Harvard University Undergraduate Surveillance ICE UNIT 7
BEGIN EXTRACT 09:33:02 04.04.25
UNIDENTIFIED VOICE 1: So I was thinking, for the anti-Trump rally, we come at them with something powerful and progressive, like “From the River to the Sea, World Trade Should Be Free,” you know, something like that.
UNIDENTIFIED VOICE 2: That’s amazing. And I have some posters with, like, that guy’s face on it, who’s that guy again?
UNIDENTIFIED VOICE 1: Milton Friedman?
UNIDENTIFIED VOICE 2: Yeah!
UNIDENTIFIED VOICE 1: Awesome. We need a bunch of those.
UNIDENTIFIED VOICE 2: This is going to be an amazing demonstration. We’ve got the free trade stuff, and the Friedman guy stuff, we just need some other stuff . . .
UNIDENTIFIED VOICE 1: Someone in the steering committee meeting suggested, like, an RFK Jr. slam? Like, Hey Hey, Ho Ho, Big Pharma’s the Way to Go.
UNIDENTIFIED VOICE 2: Not loving it.
UNIDENTIFIED VOICE 1: We can workshop some more. But I think we need to make a statement supporting our allies at Novartis and Bristol Myers Squibb.
UNIDENTIFIED VOICE 2: Totally.
UNIDENTIFIED VOICE 1: Any other allies we should support? Should we have a team carrying signs in solidarity with Walmart? They’re on the front lines of this trade stuff.
UNIDENTIFIED VOICE 2: Good instinct. Let’s keep it diverse. Let the teams know we don’t want to be just anti-Trump. That just gets us negative coverage. We need to keep it on the key progressive issues, like free trade and military intervention.
UNIDENTIFIED VOICE 1: Right. We made that clear in the planning meeting.
UNIDENTIFIED VOICE 2: Yeah. Us too. Let’s keep it issue-based. That’s what’s going to have impact.
UNIDENTIFIED VOICE 1: Right. But some of these issues? It’s like, I’m a senior and I could swear that my freshman year in my Intro Poli Sci class we were against free trade, because it was just a tool of the global patriarchal elite.
UNIDENTIFIED VOICE 2: Yeah, I was in that class, too. Plus, were you in World Health Systems in Crisis? I’m pretty sure everything RFK Jr. is saying now was in our textbook. In fact, I know it was because I used some of his stuff about seed oils in my final paper.
UNIDENTIFIED VOICE 1: And in my freshman year Survey of Modern Geopolitical Strategy we were told that when two countries have a border dispute we’re not supposed to intervene.
UNIDENTIFIED VOICE 2: Yeah. Does that mean I should tell the Ukraine team to pick another issue?
UNIDENTIFIED VOICE 1: No, no. No. I mean, no, right? It’s just weird how everything changed. And it seems like some of the stuff we’re now in favor of is . . .
UNIDENTIFIED VOICE 2: Stuff my dad was saying a few years ago?
UNIDENTIFIED VOICE 1: Right! Exactly! My dad was always telling me that tariffs are taxes and taxes are bad.
UNIDENTIFIED VOICE 2: Oh, that’s a good one! I’ll tell them to make up some posters with that one!
UNIDENTIFIED VOICE 1: Yeah. Yeah. It’s just that . . . it feels very strange to be agreeing with my Republican father. About politics and economics and stuff.
UNIDENTIFIED VOICE 2: Agree with him? But he’s a Republican! He’s a Trumper!
UNIDENTIFIED VOICE 1: No, actually he’s not. He’s not anything, I don’t think. Anymore. It’s kind of sad, actually. He just sits in the den with a lost expression on his face. When I showed him my Free Trade Now! tattoo he asked if it hurt and when I said no he asked where I got it.
UNIDENTIFIED VOICE 2: Hey, look. Yes, things are a little upside down right now, but you said it yourself! We’re at Harvard! We’re not supposed to think about this stuff, we’re supposed to lead!
UNIDENTIFIED VOICE 1: You’re right. You’re right.
UNIDENTIFIED VOICE 2: And you’re lucky your dad’s a banker. Mine is a college professor. All of this Gaza stuff hit him really hard. He didn’t know which side he was supposed to be on. We had to have him institutionalized.
END EXTRACT
** Rob Long, “The Long View”, National Review, June 2025, at https://www.nationalreview.com/magazine/2025/06/document-extract-surveillance-transcript/
****************
Again, the Dave Smith and Douglas Murray debate on the Joe Rogan Experience is linked below. Enjoy.
Who’s Leszek Balcerowicz? He was Poland’s Finance Minister in the country’s first non-communist government, then served twice as Deputy Prime Minister (1989–1991, 1997–2001) and as Chairman of the National Bank of Poland (2001–2007). He and his wife of 47 years, Ewa Balcerowicz, are economists. He oversaw Poland’s economic reforms from communist collectivism to free markets and democratic capitalism. By all accounts, it worked, while it failed in Russia, possibly owing to Russia’s penchant for sclerotic autocracy and state-empowered cronyism (let’s leave that for another time).
Why bring him up? He is the counterpoint to Trump and his bunch, the Fox News stable grafted onto the executive branch. I doubt seriously that Americans voted for isolationism and protectionism. Tariffs and withdrawal from the world didn’t show up in any polls of the public prior to November 4. Yet, those are what we are getting. Reluctance to defend the international order is evident in stories of Trump’s people pressuring Israel not to strike Iran’s nuclear facilities and some voices in the administration expressing a willingness to cut Ukraine and NATO adrift. Protectionism is the sole remaining root for Trump’s tariff war on the world after every other explanation is reduced to incoherence. Balcerowicz’s story is a fresh breath of sanity in our domestic maelstrom of security and economic claptrap.
Balcerowicz faced a tall order in 1989 with the collapse of Poland’s communist regime. Collectivism, once begun, is like drug addiction. The recovery is hell, but eventually a healthier person is restored. Free market “shock therapy” was initiated, tough times ensued, Poland stuck with it, and today Poland is rivalling Japan in per capita income. It’s a lesson well worth remembering as we lurch toward Trump-inspired collectivist protectionism.
Heck, we can’t even reform our bankrupting entitlements (Social Security, Medicare, Medicaid) without a political bloodbath. Trump promises to do nothing about them, and is trying to centrally plan his autarkic economy through his “most beautiful word in the English language”, tariffs. Businesses are watching as their decades-long economic arrangements are hammered into rubble and markets tumble.
A marked contrast is Poland. Per capita (per person) GDP is a good measure of economic health. In 1990 it was Brazil-sized at $12,810, $4,000 behind Mexico’s. In 2023 it stands at $43,585, a mere $2,500 short of Japan’s (see #1). Japan, once the darling of industrial-policy Democrats with its state-management in The Ministry of International Trade and Industry (MITI), and an unacknowledged centerpiece of Trump’s economic outlook, has flatlined for three decades. Demographically, it is in the midst of social suicide with a 1.20 fertility rate, and now with an economy to match. Trump is eager to repeat the performance with his own MITI run out of the White House and his executive orders, something akin to imperial decrees.
Oh, 2026 is the year that Poland is projected to surpass Japan in per person wealth. Barring Trump dragging the world’s economy into the toilet, aka 1930, the future looks bright for a country near the front lines abutting Putin’s horde. Not so for us.
Poland shows the way forward, not Donald Trump. If only the Republicans had the guts to study the career of Leszek Balcerowicz. Instead, as they play footsie with Donald Trump, the tumbling securities markets forecast dark clouds. Sure, bear and bull markets do not always presage a nation’s future fortunes, but sometimes they do. All the elements of serious economic disruption are present: massive government meddling, Trump’s demand for irresponsible monetary policy to cover his tracks, shattered business relationships, mammoth uncertainty, and the beginning of the pullback of capital. If capital goes into hiding, we’re in serious trouble, Great Depression territory.
In the runup to our near future expect the demagoguery of all the Wall Street vs. Main Street blather to take center stage. The class warfare of J.D. Vance links rhetorical arms with AOC/Bernie Sanders. Is it all that inconceivable for our Vice-President to show up at AOC’s next “Fight Oligarchy” rally? One has to wonder. They might have to change the title to “Fight Wall Street”. Mmmmm, “Occupy Wall Street”? Are we there yet?
A simple economic lesson will be taught to our President and his palace coterie, while the rest of us live it. Wall Street and Main Street are as intertwined as Ford and its supply chain. They can’t occupy insular realms, bubbles, silos. A withholding of capital sets off dominoes that careen onto Main Street. Investors seek to avoid Trump-driven risks by not exposing their wealth (capital) to his whims. Following the inevitable chain of events, less capital means less maintenance and growth of enterprises which translates into less business for the diner and hardware store on Main Street.
It’s a lesson well understood by any economist worth their salt. Thank goodness Poland trusted theirs, led by Leszek Balcerowicz, and stayed the course. We, in America, would rather hitch our wagon to our erratic president, and his merry band of Fox News alumni, all adhering to his faulty presumptions. It’s great for Poland, bad for us.
RGraf
Sources:
1. Thanks to Dominic Pino of National Review for these insights in “The Stat: 2026” in National Review Magazine, May 2025, p.9.
Ford 2021 Bronco SUVs on the assembly line at the Michigan Assembly Plant in Wayne, Mich., June 14, 2021. (photo: Rebecca Cook/Reuters)
Sometime in early 2027, President Trump will probably be impeached . . . again. Why? When the party in power botches things, they’re normally punished at the polls — “It’s the economy, stupid!” Inflation, shortages, business closings, people thrown out of work, recessions/depressions, etc., won’t make for a winning message. That bodes ill for the already impeachment-prone Trump, leaving aside the question of the legitimacy of any effort to remove him from office.
People are already lining up to do the favor, or predicting it. The reliably extremist Democrat Al Green (the one removed for disrupting President Trump’s March 4 speech to Congress) announced in February (see #1), “This president is unfit.” Further in the well of the House he said, “I rise to announce that I will bring articles of impeachment against the president for dastardly deeds proposed and dastardly deeds done.” Longtime Trump ally Steve Bannon agrees. Four days after the November 4 election, Bannon augured (see #2),
“Hakeem Jeffries could be, will be, the speaker of the House in two years. And the first thing he will do in the early days of 2027 is move to impeach Donald Trump. Trust me. They’re gonna put $10 billion in back of him [to take the House]. They have nobody else.”
Trump is behaving in ways to prove them right. People vote their pocketbook. It’s more than a cliché. It’s true. Stake out a position that leads to harming the voters’ children and personal fortunes and they will send you packing. Biden and Kamala Harris, et al, are proof of concept. Trump is determined to join them.
I can’t think of a more politically self-destructive act than laying waste to a good portion of the economy just in time for the 2026 midterms. His tariff war – 10% across the board, 25% on our neighbors, potentially sky high on everybody else, and the concomitant uncertainty from all the flip flops – will wreak havoc on everything, maybe with the exception of most food processing. We’ll have food, but to hell with an affordable car, or truck, or SUV, or van, or 18-wheeler, if you can find one. Expect long lines at the grocery store filled with people holding food stamp (SNAP) EBT cards.
To bring home the consequences of the Trump foolishness, let’s just take a look at the rear undercarriage of an “American-made” SUV as it passes from the U.S. to Mexico, to Canada, and back to the U.S. The inputs for just the suspension strut towers go from Pennsylvania to Coahuila, Mexico, to Livonia, Michigan, for final assembly. The differential gearbox begins with aluminum from Quebec, then to casting in Coahuila, then for machining in Ontario, Canada, and then to North Carolina for assembly. The rubber bushings for the control arms starts with synthetic rubber from Monterrey, Mexico, and then to Iowa for their attachment to the control arms. The suspension’s cradle is from Kentucky, and other pieces such as the trailing blades and brackets emanate from Kentucky, Ontario, and Puebla, Mexico.
Assembly of the various parts into a rearend occurs at Vaughan, Ontario, and Detroit. Then it is rushed to Kansas City, Mo., Fort Wayne, Ind., and Windsor, Ontario, etc., for attachment to the final product. Under Trump’s tariff regime, the final product will be hemorrhaging blood from his tariffs. It’s insane.
Why the circuitous route? Doesn’t it seem unnecessarily complicated? Those questions would arise from your typically myopic and autarkic central planner, people like Peter Navarro and Donald Trump. This process pencils out in terms of value-added and cost-benefit according to the people with skin in the game. That’s what a market does when allowed to operate freely.
Why not just disentangle the various paths and make it all occur in the U.S.? Go ahead and try. Uprooting the suppliers and their plants will come at a terrible cost and take years. In the interim, people will be going to the polls to vote against the wreckage. The complexity of disentanglement was nicely expressed by Flavio Volpe, president of Canada’s Automotive Parts Manufacturers’ Association, when he compared it to an omelet: “You can’t unscramble it once it’s done.”
Trump is Don Quixote charging windmills. Biden wanted to shove us into very expensive golf carts masquerading as family sedans. With Trump, even that screwball option may not be available. I don’t know about you but I’m keeping my 10-year-old Tundra and 9-year-old Venza. Buying new ones is likely to be a nightmare. Expect the entire auto industry to pull back as well. Now that’s the making of economic hard times.
Will the Democrats finally succeed in adding Donald Trump’s scalp to their lance this time? Well, as they say, third time is the charm.
RGraf
Sources:
1. “Donald Trump Faces New Impeachment Bid After Speech to Congress”, Martha McHardy, Newsweek, 3/5/2025, at https://www.newsweek.com/donald-trump-impeachment-al-green-2039765
2. “Steve Bannon Warns of Potential Third Donald Trump Impeachment”, Aila Slisco, Newsweek, 11/8/2024, at https://www.newsweek.com/steve-bannon-warns-potential-third-donald-trump-impeachment-1983079
3. Thanks to Ryan Mills of National Review for his piece “North America’s Auto Supply Chain Took Decades to Build. Trump’s Tariffs Could Crush It” at https://www.nationalreview.com/news/north-americas-auto-supply-chain-took-decades-to-build-trumps-tariffs-could-crush-it/
President Donald Trump holds a “Foreign Trade Barriers” document as he delivers remarks on tariffs in the Rose Garden at the White House in Washington, D.C., April 2, 2025. (photo: Carlos Barria/Reuters)
“Lies and victimhood make evil possible.” — quote attributed to Dennis Prager
Well, maybe not evil, or maybe so, but lies and victimhood are certainly not a recipe for success. The Left has long been in the grip of victimhood. It’s the base alloy for its DEI, CRT, critical legal theory, and all its “systematic” ideologies that have plagued us since they became Democratic Party dogma in the 20th and into the 21st centuries. Now, the Right has its own version in MAGA. And as John Fogerty of Creedence Clearwater Revival sang, “I see a bad moon rising”.
Why the pessimism? The Right morphed from being a correction to the Left’s manias to a thoroughgoing embrace of one of their big ones, victimhood. It’s in the MAGA title – Make America Great Again – meaning that America is a victim of a dizzying array of charlatans and miscreants, foreign and domestic. It’s a recurring script, pathetic as it may be, nothing new in the history of the world.
In that sense, we are busy making ourselves not “exceptional”. It’s not inevitable. We choose to be that way by electing leaders and absorbing their dark frame of mind. Donald Trump’s tariff war on the world is a play on this depressing display of American victimhood.
What’s more, it is based on falsehoods. The villain is said to be free trade, whether under the initials NAFTA or TPP (Trans-Pacific Partnership) or GATT or WTO, and we are said to be chumps, patsies, and victims in the story. Yet, for allegedly being fools, we are outpacing the rest of the world. Trump’s “Great Again” schtick actually misses the boat, and is working feverishly to have us join the rest of the G7 in missing the boat.
Let’s count the ways. The UK, Germany, and Japan have flatlined in GDP growth for at least 5 years or more (three decades for Japan). China’s 30-year spurt of phenomenal growth is levelling off, which is not surprising since they started from essentially zero; they’re export reliant economy is highly cyclical; and the central planning of industrial policy is famous for spectacular highs followed by spectacular lows, like a meth addict. The Soviet Union had 80 years of it and it imploded in the course of a week in 1991.
As for “Great Again”, we are already great and getting greater as the others languish. So says The Economist in its October 2024 report titled, “The American economy has left other rich countries in the dust” (see #1). How so? At the start of NAFTA, we were about 40% of total GDP of the G7 countries. Today, we’re 50%. Globally, we were 21% of the world’s economy in 2012; today finds us at 26%.
Personal measures of wealth show us to be unsurpassed. Back to The Economist (see #1 and #2), “Average wages in America’s poorest state, Mississippi, are higher than the averages in Britain, Canada and Germany.” We’re also more productive per worker. Canada’s is 70% of ours. China is a third (and falling). If this makes us “chumps”, we should pray for the condition to continue.
So, Trump’s answer is a tariff war on the world and more caterwauling about our victimhood. Go figure. On April 2, he marched up to the microphone waving a piece of agitprop titled “Foreign Trade Barriers” as if any of it matters. Ironically, these alleged foreign government manipulations of trade haven’t made them any richer as we sailed past them. “Foreign Trade Barriers” is irrelevant in the big yacht race of life.
Trump and MAGA world can’t accept the fact that our economy is different, as different as our 1890 economy was from colonial times. Ag shrunk dramatically as a slice of the American economy back then, so an 1890 Trump and Peter Navarro (Trump’s sage of trade) would be running around pushing William T. Sherman’s “40 acres and a mule” as a plank in their “Make America Great Again” campaign. To heck with Rockefeller, Carnegie, Vanderbilt, and Ford; and to heck with 21st-century Navarro’s craze for manufacturing. It would have been stillborn if this dynamic duo had their way at the dawn of American global economic dominance.
Peter Navarro at the White House
21st-century America isn’t a manufacturing basket case. The value of our manufacturing is larger today than it was 1990. We just employ fewer people as we manufacture more higher-end goods. As Rich Lowry puts it in his piece (see #2), “As we have lost jobs in manufacturing (5 million since 1990), we’ve picked them up in services (nearly 12 million) and in transportation and logistics (more than 3 million).” More tech and aerospace and less textiles and shoes. Those service jobs don’t concentrate around the burger-flipper sector. If they did, they’d be the most expensive burger-flippers since Ray Kroc, since the birth of the Whopper, that is Wagyu-paddied Whoppers.
Trade barriers or no, the proof is in the pudding. But Navarro doesn’t eat pudding, at least not the kind of pudding produced by our economy.
Navarro, Trump’s buddy in protectionism, has always been a loud advocate of central planning, government management of economic activity, in its reincarnation in Democrat neo-socialist “industrial policy”, and more. Before he joined the Trump circus, Navarro was part of the emerging California Democrat “establishment” in the 1990s that would come to dominate the state down to the present day.
By 1998, the Democrat tone for California was set in the words of people like Navarro (see #4). Eco-manias and growth-control was the zeitgeist of his campaigns for elective offices in San Diego in the 1990s. He headed an activist group called “Prevent Los Angelization Now (PLAN)”, of San Diego, and pushed almost any measure at hand to restrict the housing supply, such as preventing migration into the city, growth-control ordinances, tight controls on sewer and water hookups, fees, fees, and more fees, etc. It’s a familiar story that began in Petaluma in the 1960s and spread up and down the state’s populous coastal plain.
Navarro was hip deep in branding the word “developer” as something akin to “child molester”. Without his type of apparatchiks at the helm of local government power, according to Navarro, developers “will leave air pollution, overcrowded schools, underpoliced streets, sewer systems bursting at their seams, and traffic jams that can (and often do in California) make grown men cry.”
Today, Californians are crying, despondent over their inability to afford shelter and having to flee to other states not so beholden to the California Navarros. California has a serious housing shortage, duhhh! Getting approval to nail two studs together is a nightmare in the state. Decades of hostility to supply has attracted some roosting chickens. The chronically constrained supply has propelled the median rent in the state to $2,850, 33% higher than the national average (see #5).
Navarro’s legacy is Democrat Assemblyman Corey Jackson of Riverside. Jackson recently proposed a bill that would allow college students to sleep in their cars because many can’t afford California rent (see #7). People that think like Navarro have engineered a housing market that has relegated students to their cars. Expect student parking lots to resemble homeless encampments. What Navarro helped to bring about in California, he promises for the entire nation when Trump assigned to him the role of influencer to tinker around in the nation’s economic relations with the world.
It’s not that Trump is unaware of Navarro’s inclinations. He agrees with Navarro. Trump and Navarro have a childlike zero-sum view of the world. Bill Fulton, former head of San Diego planning, noticed the symmetry between Trump’s view of trade and slow-growthers like Navarro (see #3): “More development creates losers as well as winners, so you’d better box out the bad development or at least make those developers pay through the nose.” A rising tide raising all boats, or a growing pie that unavoidably means bigger slices for everyone, is inconceivable to someone like Navarro. Thanks to Trump, Navarro has the opportunity to muck up the nation’s economy like he helped to do for the housing supply in California.
Steve Bannon
And he’s doing it along with another fellow traveler in MAGA world, Steve Bannon. Navarro wants to centrally plan trade with his beloved tariffs. Bannon wants to bash the rich with tax increases. Here’s Bannon (see #6):
“That’s why it’s so important to not extend the tax cuts for the wealthy and actually do more tax cuts for working class people. We do this, that is a fundamental shift politically that will cement in the foundational elements for a 1932-type realignment.”
Update to Steve Bannon (see #8): the top 20% of income earners pay 83.6% of federal income taxes. As for the bottom rungs straying into the middle and working classes, the bottom 20% only get money out of the system. Their income tax rate is negative, -4.3%. The next 20% from the bottom pays essentially 0% at 0.1%. What does Bannon want, out and out income confiscation? That would place him in the company of Lenin.
Why not just vote for Democrats? MAGA is associated with the wrong party. Bannon believes, like Navarro, like Democrats, that government can micromanage us into utopia. Bannon opines on the tips, overtime, and Social Security pandering while bashing other Republicans as follows, “He’s [Trump] furthering the economics of working-class and middle-class America, and it cements the fact that the Republicans are not the country club Republicans of the Bush junta.” So, according to Bannon and any other socialist who has graced the public stage, government is the fount of all good things, and no need to pull the rug back on a ravaged housing supply and American economy as they feed The Wealth of Nations and Reaganomics into the shredder.
Such is the nature of Populism. It is the repository of crackpots, of anyone who wishes to steer government bennies to favored victims, while making real victims of those seen in a lesser light. Now we see the real home of zero-sum and it is in city hall, the state capitol, Washington, D.C., and the myriads of agencies and government offices scattered across the fruited plain. A favored few demographics are rewarded at the expense of the vast millions. None of it works, and results in the loaded U-Hauls exiting California and thousands thrown out of work by enterprises starved for capital and nonfunctioning supply chains.
Senator Russell B. Long put it best when he said in 1973, “Don’t tax you, don’t tax me, tax the fellow behind the tree.” Welcome to the Populism of Peter Navarro and Steve Bannon, and the erratic and incoherent Donald J. Trump.
It’s more than Populism that ties them together. It’s the pathetic wallowing in victimhood. It blinds a person to a reality that isn’t as dismal as these lunkheads make it out to be. It heaps blame on others and diminishes personal responsibility. In a nutshell, it is as Dennis Prager put it, “Lies and victimhood make evil possible.”
Yes, the pity party is getting tiresome.
RogerG
Sources:
1. “The American economy has left other rich countries in the dust”, Simon Rabinovitch and Henry Curr, The Economist, October 14, 2024, at https://www.economist.com/special-report/2024/10/14/the-american-economy-has-left-other-rich-countries-in-the-dust
2. Thanks to Rich Lowry for bringing these insights to my attention in “Guess What? We’re Already Rich”, National Review, 4/15/2024, at https://www.nationalreview.com/2025/04/guess-what-were-already-rich/
3. “How San Diego’s housing wars helped Peter Navarro shape Trump’s trade wars”, Andrew Keatts, Anxios, 4/15/2025, at https://www.axios.com/local/san-diego/2025/04/15/san-diego-housing-war-peter-navarro-trump-trade-war-tariff
4. Check out Peter Navarro’s own words in his “Peter Navarro fights Lynn Schenk, Susan Golding, Nancy Casady to run for Congress”, authored in 1998 during his run for Congress, at https://www.sandiegoreader.com/news/1998/apr/23/san-diego-confidential/
5. “Rent drives up California’s cost of living”, Lynn La, Cal Matters, 8/2/2024, at https://calmatters.org/newsletter/california-cost-of-living-rent-increases/
6. “Republicans Weigh Raising Taxes on Highest Earners”, Audrey Fahlberg, National Review, 4/15/2025, at https://www.nationalreview.com/the-morning-jolt/republicans-weigh-raising-taxes-on-highest-earners/
7. “California Bill Proposes Letting Students Sleep in Cars On Campus”, KFI 640 AM, 4/14/2025, at https://www.msn.com/en-us/news/us/california-bill-proposes-letting-students-sleep-in-cars-on-campus/ar-AA1CTKhM
8. “Is it True the Rich Don’t Pull Their Weight When it Comes to Paying Taxes?”, Amelia Kuntzman and Sara Wagoner, Economic Policy Innovation Center, 4/14/2025, at https://epicforamerica.org/federal-budget/is-it-true-the-rich-dont-pull-their-weight-when-it-comes-to-paying-taxes/
9 Much thanks to Dominic Pino at National Review for his socioeconomic breakdown of tax receipts in “Top 40 Percent of Earners Pay Nearly All Federal Income Taxes” at https://www.nationalreview.com/corner/top-40-percent-of-earners-pay-nearly-all-federal-income-taxes/
