Remember This: Being Right Is a Moving Target

Being correct and being on a given side is anything but a steady event. American politics is in a state of turmoil early into Donald Trump’s second term as President. On the tariff issue, the old dividing lines between the two parties are being turned upside down. One of the very few good things about getting old (other than grandchildren) is you have seen the movie before. Even the terms for deciding involve hard choices.

The most recent example would be the uproar over President Trump’s imposition of tariffs. To listen to the chattering class, led by the mainstream media (MSM), you would conclude this constitutes replacing sound economic policies with the whims of an authoritarian narcissist. Lots of handwringing about Republicans having lost their way. Plenty of quotes from GOP leaders of the past, starting with President Ronald Reagan’s defense of free trade.

Unless you think Reagan was giving a lecture to an economics class, it might be fair to ask why would he be discussing tariffs being a bad idea in the first place. In 1982, our country was in the midst of a deep recession. Guess who wanted to impose restrictions on trade to save American jobs? Bingo, the Democrats. Legislation was introduced to require certain products to be made with domestic content. As the country began to come out of the recession, Republicans and some Democrats joined to protect “free trade” from a good position and prevailed.

When Democratic President Clinton fought to see the North American Free Trade Agreement (NAFTA) ratified, the opposition overwhelmingly came from Democrats worried about jobs being lost to Mexico, because of cheaper labor. In retrospect, you can argue net-net it was a good deal, that the infamous avocado costs less as a result. What cannot be debated is whether or not jobs were lost to Mexico. They were.

In 2024, the United States ran a $1.2 trillion trade deficit. I do understand that all trade deficits at all times are not necessarily bad. Not sure anyone could reasonably argue $1.2 trillion is a good thing.

There are some other numbers that underscore the game as was being played had some troubling numbers. In 2001, U.S. manufacturing output as a share of global manufacturing was 28.4 percent. In 2023, it was 17.4 percent. The rest of the world (the denominator) did not grow in size so much that accounting for the difference (the numerator) is anything other than a massive loss of good-paying jobs in America.

As we look at the future of these tariffs, can we ask what the definitions of good and bad outcomes are in the short-term and long-term, asking what is important to us as Americans?

There is no doubt in my mind that in the short-term prices on a variety of products will increase. That means the stock market will be unhappy and portfolios and retirement accounts will be negatively impacted. We can have different opinions on how long the increases will last.

Maybe, we will prevail in having the costs for fighting for true free trade be worth it. Maybe we will be forced to return to a world of trade policy more closely resembling what had been the case prior to the tariffs.

As we adjust to the changing world of new tariffs, we also are asking what’s worth fighting for and who we are as a country. We have heard plenty about the negative impacts to expect. How about the positive, starting with working together as one united country to do what can be done to preserve and create good-paying jobs that define the middle class? It is not as though whatever has been done these recent years in trade policy was based on making American jobs anything close to priority one.

Am I the only person who finds it strange the very seem people who claim to be concerned about the well-being of all are the ones who have trouble putting the kindness of heart ahead of concerns about higher prices and stock portfolios?

At this point, I only know two things. One, smug predictions by anyone on either side of the debate are premature. We should all be humble enough to say that we just don’t know yet. Second, trying a new policy to get true free trade while preserving and creating new jobs is worth the gamble to me.

Remember this: Which party is on which side of a debate is far from being a constant. Lots of times, we take gambles, based on what we believe is more important at a given time. On the new tariffs, let’s see what actually happens. What do you think?