Dan Corkery | We may need protection from protectionist president

Dan Corkery | We may need protection from protectionist president

There he goes again.

“When a country (USA) is losing many billions of dollars on trade with virtually every country it does business with, trade wars are good and easy to win.”

Tweeting is easy. But a trade is not, nor is it good.

Late last week, Donald Trump roiled financial markets and rattled foreign capitals when he said he would soon impose tariffs of 25 percent of imported steel and 10 percent on imported aluminum. The president claims imports are threatening U.S. national security.

But past experience has shown that tariffs exact a steeper price than they create in benefits.

When President George W. Bush imposed steel tariffs in 2002, more than 200,000 American jobs were lost as higher steel prices harmed other industries. America lost more than it gained.

Many economists say the Smoot-Hawley Tariff Act of 1930 — initially an effort to protect U.S. agriculture — made the Great Depression even worse. The act imposed taxes on thousands of imported goods, leading U.S. trading partners to levy their own tariffs. Imports shrank, but so did exports. Fewer exports meant fewer jobs — and crippling unemployment.

That four-year trade war was an unintended consequence.

Trump, on the other hand, is inviting such consequence — or at least the fear of it. Apparently, he is counting on other countries to back down.

At the moment, however, other countries — China, the European Union, Mexico, Canada and others — are talking tit for tat.

And if any of them do retaliate, one of their targets will likely be U.S. agriculture — fruit, beef, cheese, cotton.

And corn and soybeans.

The so-called good trade war, which started as a sweetheart deal for steel and aluminum, could impose a heavy price on Illinois’ No. 1 industry.

Dan Corkery is a member of The News-Gazette’s editorial board. His email is dcorkery@news-gazette.com, and his phone is 217-351-5218.

Sections (2):Columns, Opinion