Our president is not a grand thinker. He is, however, the head of a movement dominating the Republican Party. Its platform is grievance. Ironically, now, grievance has become the core of both the Right and the Left. For Trump and his MAGA, the rest of the world is screwing us. The outlook is mixed with some truths, a slew of exaggerations and falsehoods, and absent self-examination. The unintended aftershocks of this political rush could be an America increasingly without partners on our continent, in our hemisphere, and in Europe and Asia. Adjustments will be made by our former partners in the face of an increasingly erratic, unreliable, and at times hostile America, an America that cares a whole lot less about common interests with other nations. Do not expect this to end well.
Trump’s chief complaint is that America is not “Great” because we are patsies. Just Monday (2/24/2025), he stood before the press and announced his tariffs in a verbal cascade of victimhood (see #1),
“We’ve been mistreated badly by many countries . . . . We were taken advantage of. We were led by, in some cases, fools, because anybody that would sign documents like they signed, where they were able to take advantage of the American people, which happened over the last long period of time, except for a little four-year period that took place four years ago. But anybody that would agree to allow this to happen to our country should be ashamed of themselves.”
Per Trump, shame on you, Americans, for preferring Toyotas to Chevies.
His incoherence is glaring when he talks about the glories of tariffs. But what is foreign trade, the thing to be tariffed, taxed? It is an exchange of a foreign producer’s goods and services for a country’s currency (paper). So, a U.S. trade deficit is our possession of their valuable things, and their accumulation of our paper. Conversely, as Trump seems to prefer, a surplus is our reverse accumulation of their paper in return for our valuable things. At root, Trump’s talk is nonsense, but it is soothing syrup to a crowd addled by a sense of victimhood.
Though, his tariffs – for Trump, “the most beautiful word in the dictionary” – will torpedo his campaign promise to reduce inflation. Any tax hikes, like tariffs on business, any business, foreign and domestic, passes through to the consumer. It works like this: raise taxes (like tariffs), increase business costs, raise prices, reduce consumption and production. A bad deal all around. The price floor rises for all goods and services, both foreign and domestic. So much for “the most beautiful word in the dictionary”. So much for ending inflation.
A better understanding of trade would be helpful. The flow of goods and currencies passes through a foreign trade infrastructure. GATT (General Agreement on Tariffs and Trade), currency foreign exchange agreements (FEA), and the adjudication of FEA disputes in the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention) work to ease the flow of trade so the foreign paper (currency) can be made valuable to its possessor. In other words, a trade deficit (more goods, less paper) or surplus (more paper, less goods) or “balance” (the value of the paper and goods in equal measure) is not as important as Trump thinks. But the superficial language of trade, absent clarifications, lends itself to demagoguery.
Admittedly, the trade numbers are relevant for national security, social, and political reasons. By themselves, they are more than sufficient to support more domestic production of physical goods. But why aren’t we more of a manufacturing powerhouse? Certainly, we came to face renewed competition from our formerly WWII-ravaged economic rivals.
The resulting challenge exposed our self-inflicted inefficiencies, thus the need for some self-examination; something buried in the rhetoric. Our appetite for New Deal tax and regulatory schemes, and bloated business bureaucracies, proved to be a hindrance under competitive pressures. Furthermore, we exposed our manufacturing to the vast expansion of the regulatory straitjacket in the 1970s due to manufacturing’s many impacts on the natural environment. Land use controls, the expansion of the eco-superstate, their spread and expansion at all levels of government, and a labyrinth of empowered NIMBYs, mandates, permits, and hearings wreaked carnage on the sector.
The air in the LA basin is cleaner due to the subsequent flight of physical production. They continue to flee. California declared war on affordable energy and the Philips/Conoco refinery in Wilmington is closing, the latest manufacturer to skedaddle the hyper eco-state. Much of the Chevron complex now resides in Houston. Adjacently, the regulatory war on housing will make the rebuild of Pacific Palisades, Malibu, and Altadena a nightmare. Cleaner air (except for the fires), combustible landscapes, Hiroshima devastation, and bankrupting energy are the new realities of the eco-Leviathan.
Manufacturing – the physical production of any kind – began a slide into the snake pit of our predatory unions, litigious culture, voracious “civil rights” lobbies, and taxes, more taxes, regulation, and more regulation. The split between the permission economy (physical production, manufacturing, construction, timber harvesting, et al) vs. permissionless economy (initially small-scale innovation that becomes capitalized into Apple, Google, Microsoft, Intel, Nividia, et al) is the main feature of this new hyper-regulated economy (see #2). Traditional manufacturing is relegated to being the red-headed stepchild.
Without addressing this problem, Trump’s tariffs are foolhardy. They will jack up prices, raise the cost of business inputs, threaten employment, and pull the only available ladder out of the snake pit that America has made of itself. American economic activity, and particularly manufacturing, cries out to be something other than survival in a snake pit.
DJT should address the pit before he tries to sell the narcotic of tariffs to the public. If not, trade relations will be disrupted as our friends scramble to protect themselves and their nascent industries. New trade arrangements will arise with America seen as just another economic belligerent.
To make the tariff scheme palatable to the public, the jargon of “reciprocity” is employed to hide the real purpose of tariffs. The prime directive of tariffs is to punish domestic consumers for preferring a foreign-made product. I am skeptical of their use as a bargaining chip since the tariff prime directive remains, even if reciprocity agreements are temporarily achieved. The political pressure by the snakes in our pit will make a hash of the “reciprocity”.
What Trump is doing to international trade, he promises for our foreign policy. Already, an undertow of cynicism infects our relationship with our allies (see #4). Trump sees our national security as another arena to apply the same approach as he would with a supplier of pipe. For instance, Trump has introduced a cushy deal for rare earths as a part of a survival package for Ukraine. To him, it is like demanding from the supplier the free gratis addition of brass fittings to the order. Trump has made extortion an element for a relationship with the United States.
For Trump, it is not enough to stand athwart a thug’s subjugation of another country on a continent already made jittery by two previous 20th-century world wars totaling over 100 million deaths and the USSR enslavement over half of it. Not surprisingly, eyebrows are raised in European capitals by Trump’s Belgian Congo-style treatment of Ukraine. Trump’s America comes close to being the reincarnation of the British East India Company.
It is not as if Ukraine has a realistic alternative to Trump’s USA. The situation has a key role to play in Trump’s Art of the Deal for international affairs. If you are dependent on him, you are at his mercy. It results in the odd abuse of friends with whom he can control, and odd praise of enemies with whom he does not. Trump recently declared that Putin is smart and strong and Zelensky is a dictator (I kid you not) and stands accused of starting the war (I kid you not). He gets away with it because he has leverage on Zelensky that he does not have on Putin, thus the pandering to a thug and the defamation of Zelensky. It is negotiations by shakedown in threats, insults, and extortion. For Trump, it must be like extracting concessions out of his favorite pipe supplier. The unrestrained nature of international affairs presents a playground for Trump’s baser instincts.
Trump’s Ukraine/Putin stage act reminds our friends and allies of the danger of getting too close to America. Post-WWII, South Vietnam’s existence was placed at the mercy of American domestic politics and resulted in the collapse of South Vietnam and the rest of Southeast Asia. Leaping forward to 2020, American domestic politics reared its ugly head over Afghanistan with the rise of Trump and his subsequent Doha Accords with the Taliban. Trump and his people repeated the Nixon/Kissinger tactic of negotiating the future of our friend and ally without them being in the room. Timetables for an American withdrawal were set only to be inflamed by more American domestic politics with calamitous effects for Afghans. Afghanistan descended into a dark age at our bidding.
Can you blame any potential international partner for wariness in getting too close to the USA? They have alternatives. They could cut their own deals with our common enemies turning America First into America Alone. Appeasement might sound more appealing than laying yourself open to America First and an insane Democratic Party.
They could expand their defense capabilities and magnify their efforts in coalitions without a troublesome USA. Trump’s America First becomes America Problematic. Such arrangements will not have our interests at heart. America First, now known as America Alone, will be an unreliable, isolated nation with an expanded dependence on an even greater military buildup than is possible given our current domestic politics. Are you prepared to slash entitlements? Our crazy Democrats went bonkers over George W. Bush’s 2005 nibbling at Social Security’s edges (see #3). What makes you think that Democrats would not seek to ride the hysteria to more political fame and fortune this time around? Bottom line, America Alone becomes America Weaker.
This is our “master of 4-D chess” at work. We are not prepared for the consequences. The “most beautiful word in the dictionary” only disguises our deep-seated economic problems. America First will cause our friends to run for the exits. Any “peace” deal over Ukraine will come at the expense of more screw-tightening on the victim. America needs to address what we have done to ourselves before we scapegoat our friends and allies. Welcome to the world of America First.
The rabble-rousing has the advantage of feeding popular prejudices. Grievance has proven to be a political winner. The Right has discovered its inner victim in the same manner as the Left for over a century. The world should be leery of an America united in grievance.
RogerG
Sources:
1. “Trump: ‘Tariffs Are Going Forward On Time, ‘We’ve Been ‘Led By Fools”, Tim Hains, Real Clear Politics, 2/24/2025, at https://www.realclearpolitics.com/video/2025/02/24/trump_tariffs_are_going_forward_on_time_weve_been_led_by_fools.html
2. “The Future of Innovation in the United States: Permissionless or Regulated?”, Mohamed Mutii, Econlib, 10/14/2023, at https://www.econlib.org/the-future-of-innovation-in-the-united-states-permissionless-or-regulated/
3. “How George W. Bush Lost Personal Accounts For Social Security”, Peter Ferrera, Forbes, 4/7/2011, at https://www.forbes.com/sites/peterferrara/2011/04/07/how-george-w-bush-lost-personal-accounts-for-social-security/
4. For an American public uninterested in the foreign discussion about America, tune into this podcast, “Can German centrists keep ignoring the hard right AfD?”, The Daily Telegraph, 2/24/2025, at https://youtu.be/LiLEeFlbfHk?si=eOveyaQX98wuaumb . It covers more than the results of the German election. Toward the end of the interview, a major German parliamentary leader expresses major skepticism of a Trump-led America.
