You will have to put the Kool-Aid down for a few minutes for this blog. For the most part I agree with everything President Trump has done, foreign policy issues notwithstanding. While I agree tariffs are necessary to even the playing field globally, I think Trump is going about it wrong.

A little history here first. Every president has punted on the idea of tariffs on foreign nation’s goods except maybe Eisenhower, I as a student of history, think he was going to attempt to try it. Point being it’s a very hard thing to accomplish. Politically if it doesn’t work, you will be a one term President (no bother to Trump here) and your party will lose massive seats in the next election.
Here are the issues facing Trump in this uphill climb on tariffs.
His own party:
Let’s face it, the GOP is good at one thing, claiming a principled stance then reversing course a year later. Check out each government shutdown they created… what did they ever extract? Yeah, my point exactly. These coconuts are more concerned with getting re-elected, not the health of the nation. Their pocketbook, not yours is the goal here.,
NAFTA/CAFTA and other free trade agreements:
These agreements made it, so the manufacturing phase was sent outside the US solely to save money on cheap foreign labor. The premise here was to keep the input costs down and as a result the trinkets we love to buy are dirt-cheap. If labor costs rise in say China, close the factory and move to Bangladesh, Vietnam etc. etc. These trade agreements, unlike most legislative moves today, came through Congress so they likely will need to be reformed/circumvented/repealed.
Cheap foreign labor:
See above, but the point stands, the American worker will cost substantially more, then throw in mandatory benefits (these manufacturing centers will have far more than the minimum to avoid benefits/union forming) suddenly the foreign workers seem better. The cost of your favorite t-shirt to wear won’t be $20, trust me.
CEO/C-Suite/90-day calendar folks:
These folks do not care about the price of the goods you pay for, they could care less about your livelihood or employment status, they are bean counters. The reason the above 2 reasons exist is due to these people. They care only about earnings per share/costs and stock price. That’s all that matters. They get a bonus (except 90 day guys) due to performance. They moved the jobs out of the US to save labor/benefit costs, then they moved them again due to the ability to save $.01 a share. It’s the bottom-line only to these losers. Bringing the jobs back, or the effects of a tariff scare these folks. Again, a falling stock price leads to “how can we fix this?”
American Consumers:
Let’s face it, we love buying cheap crap. We do not care where it is made. Let’s again be honest here, we only care when we hear about product recalls and lead contamination etc. We love buying cheap stuff! It’s a hard sell to say you are going to pay more but it’s better in the long run. Older generations grew up with Blue Light Specials (RIP K-Mart), dollar stores, and everyday low prices. It’s a tough sell.
Foreign Customers:
They are a tough sell; it’s a foreign brand to them when we try to sell our products overseas. They know the names: GM, Ford, Kellogg’s etc. So, we try to buy foreign brands and hide the fact it’s an American company, but I digress. Most foreign countries are fiercely loyal to their domestic products, and they do not trust foreign ones. When people argue when they go to Japan its nothing but Toyota, or BMW/Volkswagen in Germany it’s a national pride thing as opposed to a cheapest price thing. They tariff us to not let us undercut them as well. Canada and parts of the European Union right now are labeling/removing American goods and putting “buy _______ support local” signs on their goods.
Product Quality:
As stated above we outsource everything to the point quality doesn’t matter. The Craftsman brand comes to mind, rather than stand for a quality product, its cheaply made crap that will break on you during the first job use. This is what happens when the idea that costs must always come down. Foreign and even domestic companies know our products are inferior to theirs.
Globalists:
These folks were the loudest during the Bush years, now they are changing their tune. The issue for people like me is that it’s hard to take someone like Rick Santelli of CNBC seriously when he is outright flip-flopping on this issue. Suddenly he cares about the Chinese/foreign cheap labor? Santelli and his ilk remind me of the older generation, they sent the jobs overseas and were thrilled with cheap costs but now want to do a re-mix because it’s cool. They saw the jobs leave and now are concerned about the future? Yeah, sure! It will be hard to sell this to the folks. Santelli’s final word in an article I read was “Americans will be fine with higher prices on goods” that’s a tough sell to folks when Trump said he would lower the cost of eggs.
Trump is going to have a very hard time closing this deal. While I am rooting for him, I think he went about it all wrong. I would have microtargeted a couple countries and gone from there, take a few victories, and move onward and upward. His problem is that he is going to try for the jugular. While a few countries have potentially given in, most are announcing reciprocal tariffs on our goods. In other parts of the world China is likely moving in, willing to dump their products and fill the consumption gap. This could cause a long-term headache, as we do not want China being a massive superpower.
Additionally, American’s do not have much resolve anything. Turn the clock back a couple generations and buy American was a thing. In the modern day, “Made in USA” means the stickers were put on it here, but not much production is done stateside. Production here is even more outsourced. Right now, during high inflation/low wage growth/raising prices times, American’s do not have the stomach for higher prices. At what point do we as a people say, “put it back to how it was!”
Lastly and my biggest point, when your 401k becomes a 104k in the span of about a week, you tend to not like the guy/party in the White House. It’s one thing to have high prices, it’s another to see your retirement account go away. Again, I hope this works. It’s nice to have a president who doesn’t do politically correct things, but this is going to be a tough sell. How long do we watch chaos unfold in the market before we cave?
Major credit to Trump for trying though!
The Chief
Editor’s Notes:
- It doesn’t help that the financial markets, run mostly buy Democrats, don’t understand what Trump is trying to do.
- In addition, none in the workforce are old enough to remember when tariffs were used to protect American jobs.
- NAFTA was the death null of domestic manufacturing and the triumph of globalism.
- Lastly, when you abort 1/3 of all children in your nation for over 50 years, outsourcing is your only viable option to maintain your lifestyle.