More Than You Wanted to Know About Tariffs

Trump has it all wrong. Surprise!

Hello, subscribers. Some people I trust have been urging me to write a sort of primer on tariffs, and Donald Trump’s latest diktat seems to provide an occasion. This long post, practically a working paper, will, at least at first, be for paid subscribers only — while my weekday rants are always free, those of you who have contributed should get a few perks for your generosity. And something like this, a fairly big project that I hope people will find informative but isn’t part of understanding what happened in the past 24 hours, seems like a good candidate.

For those of you deciding whether to chip in, here’s what is behind the wall. First, a survey of the actual levels of tariffs around the world. Second, a summary history of how advanced economies — all of them, not just the United States — got from the protectionism of the 1930s to nearly free trade, at least in manufactured goods. Third, a brief overview of the quite different history of tariffs in emerging economies, which had very high tariffs until the 1980s, then brought them way down, although they’re still higher than those in the advanced world. Finally, what you should know about value-added taxes, which shouldn’t be part of this discussion but probably will.

OK, let’s get started.