SACRAMENTO — Americans are accustomed to Donald Trump’s tall tales, as he recently told an improbable story about firemen lifting him out of the 9/11 rubble. We’re also used to his unprincipled and irresponsible ideas, such as his recent promise to pay each American $5,000 if the GOP retains Congress after the midterms. That would add $1.35 trillion to the debt, by the way. Fortunately, he’s as likely to make good on it as he was in paying out DOGE checks or even paying his own contractors.
My Republican friends haven’t tired of this carnival-barker act and tell me not to take him literally. However, sometimes the president details his policy views that seem too serious to ignore. For instance, he recently detailed his thinking on trade, which is the foundation of the administration’s tariff policy.
Here’s what he said at a press conference: “We could do tremendous good for ourselves by just not trading with countries. We lose with the European Union $200 billion a year. If I didn’t trade with them, we’d lose nothing. Just one swipe of the pen. We lose with Mexico $195 billion a year. … They have nothing we have to have. I mean, hot tamales, tomatoes, a couple of things.” This displays a nearly unfathomable level of economic ignorance.
For starters, Trump saying that he can stop all trade with “one swipe of the pen” is the stuff of authoritarian countries. Do we want a nation where the Dear Leader can obliterate millions of complex voluntary trading relationships?
Founding Father John Jay envisioned a nation where “every man being then at liberty, by the law, to cultivate the earth as he pleased, to raise what he pleased, to manufacture as he pleased, and to sell the produce of his labor to whom he pleased, and for the best prices, without any duties or impositions whatsoever.” Free trade is at the heart of a free society, even if Republicans have ditched their party’s post-Ronald Reagan advocacy for it.
It’s hard to top Reagan’s 1987 radio address about the impact of tariffs: “[H]omegrown industries start relying on government protection. … They stop competing and stop making the innovative management and technological changes they need to succeed in world markets. … High tariffs inevitably lead to retaliation. … The result is more and more tariffs, higher and higher trade barriers, and less and less competition…. [P]eople stop buying. Then the worst happens: Markets shrink and collapse; businesses and industries shut down; and millions of people lose their jobs.”
What makes the Trump approach even worse: By insisting that he alone has the power to dramatically revamp trade policy by fiat, he has imposed uncertainty on the business community. Every time some foreign leader annoys him, Trump announces 50% or 100% tariffs, then he backs down, reduces them, then increases them again. Supply chains can take years to develop. It’s hard to plan for the future in this scenario. The only results are higher prices and slowdowns.
Let’s not forget that tariffs are taxes, period. They are paid by Americans. They are inflationary. They rarely protect jobs because when, say, the president imposes steel tariffs to protect steel workers, those same tariffs increase prices for automobile manufacturers and other companies that rely on steel. They raise prices and lose business, then have to lay off workers or shutter plants. By the way, when companies are protected from foreign competition they don’t reduce prices — they typically raise them because they face less competition and, per Reagan, avoid making technological changes that boost efficiency and benefit American consumers.
Tariffs and other restrictions on trade do not, as Trump said, create a “tremendous good” for Americans. Quite the reverse. Think of all the wonderful benefits we get from open trade — the vast array of fresh fruits and vegetables we can now enjoy in January, the selection of products of every type from every corner of the world.
“The U.S. ran a $197 billion goods deficit with Mexico in 2025, but Mexico also supplies critical vehicles, machinery, electronics and agricultural goods to U.S. businesses and consumers,” explains FreightWaves, a transportation trade publication. If every one of those items had to be manufactured in the United States, it would take years to undo disrupted supply chains and lead to dramatic increases in consumer costs. Haven’t we had enough inflation?
Trade deficits are an accounting fiction. We all run trade deficits with our local grocery store — to each of our great advantage. Republicans are obsessed with halting immigration, yet what better way to reduce the pressure for job seekers to immigrate to the United States than encouraging the construction of job-producing factories in Mexico and elsewhere and then just simply trading with them?
Free trade boosts consumer choice and economic growth. It reduces prices and makes for freer lives, so we’d be foolish to ignore Trump’s ill-informed tirade.
Steven Greenhut is Western region director for the R Street Institute and a member of the Southern California News Group Editorial Board. Write to him at sgreenhut@rstreet.org.