by Alan Reynolds, Cato at Liberty, April 8, 2025.
Excerpt:
“There came another folly of government intervention in 1930 transcending all the rest in its significance and in its baleful consequences. In a world staggering under a load of international debt, which could be carried only if countries under pressure could produce goods and export them to the creditors, we, the greatest creditor nation of the world, with tariffs already far too high, raised our tariffs again. The Hawley-Smoot Tariff Act of June 1930 was the crowning financial folly of the whole period from 1920 to 1933…
“Once we raised our tariffs, an irresistible movement all over the world to raise tariffs and to erect other trade barriers, including quotas, began. Protectionism ran wild over the world. Markets were cut off. Trade lines were narrowed. Unemployment in the export industries all over the world grew with great rapidity, and the prices of export commodities, notably farm commodities in the United States, dropped with ominous rapidity. Farm prices in the United States dropped sharply through the whole of 1930, but the most rapid rate of decline came following the passage of the trade bill.
“The dangers of this measure were so well understood in financial circles that, up to the very last, the New York financial district retained hope that President Hoover would veto the tariff bill. But late on January [sic: Anderson says January]15, it was announced that he would sign the bill. This was headline news Monday morning. The stock market dropped 12 points in the New York Times averages that day, and the industrials broke nearly twenty points. The market, not the President, was right.”
DRH note: The 12 point drop was a drop of approximately 5%.
by C. Bradley Thompson, The Redneck Intellectual, April 8, 2025.
Excerpt:
One of his [Thompson’s] great hopes is that the long-suffering Canadian people will one day liberate themselves from their soft tyranny (gift wrapped in the famous Canadian niceness and politeness) and become a free country again, free of the creeping socialism that has been slowly destroying Canada since April 20, 1968, when the charismatic and charming Pierre Trudeau was first elected Prime Minister.
Canada was once a free society, particularly in the decades before World War II. (By the way, the great early twentieth-century American classical-liberal writer, Albert Jay Nock, once wrote a wonderful essay “Why Nature’s Way is Best”, American Magazine, July 1911 in which he suggested that the Canadian Province of Alberta was one of the freest places in the world.)
DRH comment: Brad is a fellow Canuck. I’ve had the same impression of the older Trudeau that he had. He did one good thing as Justice minister before becoming Prime Minister: legalizing homosexuality. I hadn’t known about Alberta, but it’s plausible. In 1969, when Trudeau was getting Medicare, Canada’s single-payer system, going, Alberta was the province with the most resistance.
by Phillip W. Magness, Quillette, April 9, 2025.
Excerpts:
This confusion is the result of an ideological battle being fought inside the White House. Although Trump assembled an economic team of like-minded “tariff men” to enact his policies, his advisers seem to be at odds over what the tariffs they favour are supposed to achieve. The chaotic implementation of the past two months reflects their competing goals, which include classical protectionism, revenue generation, and a sweeping scheme to devalue the dollar and “reset” the international economy. Instead of forming a cohesive tariff agenda, they vie for the president’s ear and lead him down conflicting paths.
At present, there appear to be about five different tariff camps within the Trump administration. Since the economics profession overwhelmingly rejects tariffs, almost all of Trump’s “tariff men” hail from the fringes of the discipline. But these peripheral perspectives do not agree with each other as a brief survey of the tariff landscape will reveal.
And:
The burdens of Navarro’s statistical contrivance will nonetheless impose profound and adverse effects on most Americans. Contrary to the classical protectionists’ claims, the costs of a tariff are inevitably passed on to consumers—either through price increases used to absorb the tax itself or by importers shifting procurement to “protected” domestic firms, which then raise their prices to a level that corresponds with the tax.
And far from reversing trade deficits, tariffs of this type ultimately impose self-defeating penalties on US exporters. First, because exporters are price-takers on a global market and must therefore absorb any increased costs to their raw material inputs caused by tariffs. And second, because tariffs tend to trigger retaliatory trade wars abroad, in which other countries target US exporters with punitive levies, thereby cutting them off from the international market.
by Adam N. Michel and Joshua Loucks, Cato at Liberty, April 11, 2025.
Excerpt:
Despite persistent political narratives, IRS data show that the federal tax system is not only highly progressive but has become more so over time. High-income Americans pay a disproportionately large share of federal income taxes and face the highest average rates across the entire tax code.
Already facing high tax rates, top earners can’t cover the cost of the ever-expanding government alone. The experience of the European welfare states illustrates that, eventually, everyone has to pay for big government. With annual deficits nearing $2 trillion, the real problem isn’t too little tax revenue—it’s too much spending.
