Michael Lind: Why Tariffs are Good, By James Reed

Liberal nationalist Michael Lind has put the case for tariffs: "Why Tariffs are Good" https://www.tabletmag.com/sections/news/articles/tariffs-good-trump-china

Lind begins by challenging the reflexive condemnation of tariffs by free-trade advocates, particularly in the context of Donald Trump's trade policies toward China. He argues that the intellectual consensus labelling tariffs as economically disastrous is oversimplified and ignores historical and practical realities. His central claim is that "no major country in history has industrialized successfully under a regime of free trade without tariffs or subsidies." He cites the United States and Britain as examples, noting that both used protectionist policies during their industrial rises—America with high tariffs in the 19th century and Britain with mercantilist controls before embracing free trade only after achieving industrial dominance.

Lind delves into U.S. history to bolster his case. He points out that from the Civil War to World War II, the U.S. maintained some of the highest tariffs in the world, averaging around 40 percent on manufactured goods. This protectionism, he argues, allowed American industries to grow without being overwhelmed by more advanced European competitors, particularly Britain. He references the "American System" of Henry Clay and Abraham Lincoln, which combined tariffs, infrastructure investment, and a national bank to foster industrial self-sufficiency. Lind contrasts this with the post-WWII era, when the U.S., as an industrial superpower, shifted toward freer trade to bolster allies against the Soviet Union—a policy he sees as less relevant today given China's rise.

A significant portion of Lind's argument focuses on China's state-directed economy, which he describes as a hybrid of mercantilism and capitalism. He asserts that China uses subsidies, currency manipulation, and intellectual property theft to dominate global manufacturing, producing goods at artificially low costs that undercut American producers. This, he argues, has hollowed out U.S. industrial capacity, particularly in sectors like steel, electronics, and pharmaceuticals. Trump's tariffs—such as the 25 percent tariffs on Chinese goods implemented during his first term—are framed as a necessary countermeasure to level the playing field. Lind suggests that these tariffs aim not just to punish China but to encourage domestic investment, pointing to examples like increased U.S. steel production following Trump's steel tariffs.

Lind takes aim at what he calls the "free-trade fundamentalism" of economists and policymakers who treat tariffs as an economic sin. He argues that their models often assume idealised conditions—perfect competition, no government distortions—that don't reflect reality, especially when dealing with a strategic rival like China. He dismisses the argument that tariffs inevitably harm consumers through higher prices as shortsighted, noting that the cost increases from Trump's tariffs were modest (often absorbed by importers or offset by currency adjustments) and that the long-term benefit of a stronger domestic economy outweighs such drawbacks. He cites studies, like one from the Coalition for a Prosperous America, suggesting that the economic stimulus from tariffs can create jobs and growth that mitigate price hikes.

Beyond economics, Lind emphasises the national security implications of trade policy. He warns that reliance on China for critical goods—like semiconductors or medical supplies—leaves the U.S. vulnerable in a crisis, as seen during the Covid-19 "pandemic." Tariffs, he argues, are a tool to "reshore" key industries, reducing this dependency. He contrasts this approach with the post-Cold War optimism that free trade would liberalise China, calling that hope naive given Beijing's increasing authoritarianism and economic aggression.

Lind anticipates and rebuts common criticisms. To the claim that tariffs disrupt global supply chains, he suggests that such chains were already shifting due to rising Chinese labour costs and geopolitical tensions, and tariffs merely accelerate a necessary adjustment. He also tackles the idea that tariffs hurt American exporters (e.g., farmers hit by Chinese retaliation), proposing that government support or new markets could offset losses—a pragmatic trade-off for broader industrial gains.

In closing, Lind frames Trump's tariff policies as a return to a realist tradition in American economic thought, not mere populist bluster. He argues that they reflect a recognition that trade is not just about efficiency but power—economic, industrial, and military. While acknowledging that tariffs aren't a panacea and must be paired with broader industrial strategies (e.g., tax incentives, R&D investment), he insists they are a vital weapon in the U.S.'s economic arsenal against China's mercantilist challenge.