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He claims that tariffs will force foreign manufacturers’ prices up, which will help American manufacturers compete.
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He claims many countries, notably China, manipulate currencies and dump products at below-market prices. Tariffs supposedly force these countries to raise their prices.
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He claims that tariffs can help reduce the U.S. trade deficit and encourage the domestic consumption of American-made products.
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He claims the tariffs will make us less reliant on foreign suppliers of critical sectors like steel and aluminum.
- He claims the federal income from tariffs will provide money for tax cuts to offset inflationary price increases.
The problem is that these are not only mutually incompatible but individually false.
MUTUALLY INCOMPATIBLE
Consider #1 and #4. Suppose our tariffs successfully force foreign manufacturers to raise prices, making them less able to compete with American manufacturers (#1).
In that case, our government will have less tariff income thought to offset inflation with tax cuts (#5).
The more successful is #1, the less successful will be #5.
Further, because all U.S. tariff money comes not from foreign exporters but from U.S. citizens, the reduction in the trade deficit would be funded by Americans, not by foreigners.
Since the lower 80% of Americans purchase most foreign goods, the proposed tax cut would benefit the rich, not the average American.
All tariffs are transfers of money from the poor and middle to the rich—a right-wing, reverse Robin Hood approach.
The whole point of tariffs is to force prices up. By design, tariffs are inflationary. Inflation will require domestic manufacturers to pay more for supplies.
Workers, paying more for goods and services, will demand higher wages, thus forcing American manufacturers to pay more for labor.
INDIVIDUALLY FALSE
Trump’s claim that tariffs will increase foreign manufacturers’ prices is incorrect. Tariffs will add a sales tax to the foreign manufacturers’ prices. Like all sales taxes, the sales tax will be paid by the buyers, in this case, Americans.
The so-called “trade deficit” is not a real deficit. It is an even exchange. America pays with dollars; they pay with goods and services.
The U.S. creates money effortlessly by pressing computer keys, while others produce goods and services through physical labor and resources.
In that exchange, we receive the better of the bargain.
Tariffs only can make us “less reliant” on foreign suppliers of critical sectors like steel and aluminum by increasing the prices of steel and aluminum.
Paying a higher price for steel and aluminum does not benefit America.
Finally, the biggest lie of all: Trump’s claim that the federal income from tariffs will provide money for tax cuts. The federal government already has infinite money to provide tax cuts.
In fact, if the federal government collected zero taxes, it still could continue to deficit spend endlessly.
Being Monetarily Sovereign, the government never can run short of dollars.
THE BETTER SOLUTION
Strangely, when faced with a problem where the solution involves reward or punishment, Trump always chooses punishment (except for himself). If the problem is how to protect American industry and the American economy in competition with foreigners, the solution is not to punish the foreigners but to reward America.
If foreign companies price their products too low for American industry to compete, the solution is for the U.S. federal government to reward American industry via tax credits and direct payments.
That is what we have already done for many industries:The U.S. agriculture sector is one of the most heavily subsidized in the U.S. Government support here includes direct payments, crop insurance, and various subsidies aimed at stabilizing farm income and ensuring food security. Rather than increasing consumer prices, as tariffs do, these support lower consumer prices.
Oil, natural gas, and coal industries have historically benefited from tax breaks, deductions, and other financial incentives that lower production costs and encourage domestic energy production.
Renewable energy sectors, such as solar and wind energy, have received substantial federal and state support through tax credits, grants, and loan guarantees to help drive the adoption of cleaner energy sources.
Elon Musk should appreciate this: The U.S. government has offered incentives and funding for developing and manufacturing electric vehicles and related technologies.
Substantial government support is provided to the aerospace and defense industries, including direct contracts for research, development, and procurement, which are essential for maintaining technological leadership and national security.
The semiconductor industry has seen increased government support (such as through the CHIPS Act) via grants and tax incentives. These measures aim to reduce reliance on foreign suppliers, enhance domestic manufacturing capabilities, and secure critical technology supply chains.
SUMMARY
The federal government has the infinite ability to create dollars. Rather than trying to punish other nations with tariffs, which in reality punish Americans and cause inflation, the federal government should reward Americans and simultaneously fight inflation by addressing the shortages that cause it.
Rodger Malcolm Mitchell Monetary Sovereignty Twitter: @rodgermitchell Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell; MUCK RACK: https://muckrack.com/rodger-malcolm-mitchell; https://www.academia.edu/……………………………………………………………………..
A Government’s Sole Purpose is to Improve and Protect The People’s Lives.
MONETARY SOVEREIGNTY
#Monetary Sovereignty - Mitchell 
WASHINGTON POST
The false things Trump said about tariffs during his announcement
The president relied on claims that have been debunked many times before.
April 3, 2025 at 6:00 a.m. EDT
President Donald Trump’s speech announcing a huge increase in tariffs on American trading partners was riddled with falsehoods and misleading statements on trade that he has made for years.
“For years, hardworking American citizens who were forced to sit on the sidelines as other nations got rich and powerful, much of it at our expense. But now it’s our turn to prosper and in so doing, use trillions and trillions of dollars to reduce our taxes and pay down our national debt.”
This is exaggerated. In Trump’s telling, the United States is a poor country, beset by outside forces. Not only does the U.S. have the largest gross domestic product in the world, but its GDP per capita is much higher than that of any other large country.
For instance, GDP per capita in the United States is nearly $90,000, compared with $14,000 for China, $58,000 for Germany and $36,000 for Japan.
Tariffs are in effect a tax increase, one that falls heavily on lower-income workers. Economists agree that tariffs — essentially a tax on domestic consumption — are paid by importers, such as U.S. companies, which in turn pass on most or all of the costs to consumers or producers who may use imported materials in their products.
Trump ignores that trade can be mutually beneficial. The European Union is the largest export market for the U.S., and if the Europeans retaliate, that will be a big loss for American manufacturers.
International trade works in such a way that some countries dominate some markets and don’t compete as much in others. The French have trade restrictions on U.S. wine, just as the U.S. has trade restrictions on French clothing.
“Toyota sells 1 million foreign-made automobiles into the United States, and General Motors sells almost none. Ford sells very little. None of our companies are allowed to go into other countries.”
This is misleading. Market forces, not trade, are a critical factor. American cars have fared poorly in Japan because the Japanese prefer smaller, more fuel-efficient models.
But the Chinese like American cars, which, contrary to Trump’s claim, are allowed to be sold there. Until 2023, General Motors sold more cars in China than in the U.S., but sales have fallen because China has developed a preference for electric cars — where GM has lagged.
“Then in 1913, for reasons unknown to mankind, they established the income tax so that citizens, rather than foreign countries, would start paying the money necessary to run our government. Then in 1929, it all came to a very abrupt end with the Great Depression, and it would have never happened if they had stayed with the tariff policy; it would have been a much different story.”
This is nonsense history. The income tax was intended to shift the burden to wealthier Americans as the cost of tariffs fall mainly on lower-income people. Tax revenue was also considered a more stable source of funds.
One big advocate for an income tax was Theodore Roosevelt, a Republican. As for the Great Depression, many historians say the Smoot-Hawley Tariff Act, signed into law in 1930, worsened the economic slowdown because it sparked a global trade war.
“Apple is going to spend $500 billion. They never spent money like that here.”
President Joe Biden got a similar deal. A few months after Biden took office, Apple pledged to invest $430 billion over five years in the United States. Adjusted for inflation, that’s $525 billion.
“They [China] never paid 10 cents to any other president, and yet they paid hundreds of billions.”
This is false. Tariffs have been collected on Chinese goods since the early days of the republic. President George Washington signed the Tariff Act of 1789, when trade between China and the United States was already established.
Tariffs on China generated at least $8 billion every year since 2009.
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“Apple is going to spend $500 billion. They never spent money like that here.” said Trump.
It wouldn’t surprise me if Trump is claiming credit for Apple’s pledge made during the Biden Administration. He often claims he did what others did, especially when he’s on the ropes like now, with markets going into Bear territory. That’s not what his wealthy friends want at all. If it doesn’t turn around next week, he’s going to get a lot of pressure from them to reverse course.
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Trump’s mind is slipping. He is getting old. He talks about a 3rd term, but that won’t happen. No one will want him. The House will shift, and Trump will be powerless. The Dems better pull themselves together, because they will run against the VP.
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