Tariffs or Temper Tantrum
Why the Trump Tariffs are dumber than most people realize.
April 11, 2025
These are the disparities that have triggered us to go full nuclear to obliterate the U.S.-led global economic order.
Even after the "90-day pause", our tariff rates are at unprecedented highs. It is the most astonishing self-own in economic history.
Even if these tariffs are fully withdrawn tomorrow, the damage is done. Even if we re-negotiate a few trade deals that gain us a couple points, the economic order will never be the same.
The U.S. created this system. The U.S. benefits from this system (trade deficits do not equate to economic loss). The U.S. gets all the advantages of the USD being the world reserve currency. The U.S. has deliberately accepted disparities in tariff rates (fairly minor as you can see) in exchange for policy alignment and preferential access for U.S.-based multinationals. In fact, the U.S. has routinely weaponized the system against others--far from being the victims we have painted ourselves to be.
Yes, China has taken advantage of the system to some degree, but China has learned over the years that you cannot play ball by the terms set by the "West" without getting burned.
China was minding its own business when western powers invaded and forced it to import massive amounts of narcotics. U.S. troops helped to sack and loot Beijing in 1900. All of this led to a once-wealthy nation becoming extremely impoverished. China also saw how the U.S. used the trap of debt to gain total control over other nations and their resources.
IOW, a lot of the U.S. trade deficits over the years is actually attributed to the artificially cheap goods and resources that have enriched our country far more than those countries from which they were appropriated.
With all that being said, we could have tried to rebalance the global economy in a way that was fair and realistic--without imposing massive economic pain on the poor and the middle classes in our own country and throughout the world. We could have ensured that the gains from globalization all these years were distributed more fairly among our own citizens. We could have used more of the proceeds to build up strategic industries instead of always finding ways to put more into the pockets of the wealthiest.
But we didn't, and that's on us, and now we are now going to throw the biggest temper tantrum of all time to hurt ourselves just so we can hurt others--all because they are not eager to give the bully in the schoolyard all of their lunch money instead of just some.
If the U.S. were serious about reshoring even just half of the current imports with domestic production, it would need to build thousands of new factories at an average of 3-500,000 sq. ft. apiece. This is physically impossible without a historic infrastructure upgrade.
The fact that this isn’t even being discussed shows just how intellectually lazy and harebrained our current actions are.
Loading, offloading and transporting raw materials requires far more capacity than an equal amount of volume for finished goods because the shipments are bulkier, heavier, less stackable and often more hazardous. Ships, railcars and trucks have to be more specialized, and new transportation nodes and networks are needed.
Obviously, the U.S. does a lot of this already, but it would have to do it at far greater scales.
In addition to the factories themselves, the U.S. would also need:
- Tens of thousands of miles of new and upgraded roads
- Tens of thousands of miles of new and upgraded rail lines
- Reinforced and rebuilt tunnels and bridges to support industrial-scale freight demands
- Hundreds of thousands of miles of new and upgraded pipelines
- Massive port expansions (roughly double existing capacities)
- A minimum of 20 new high-capacity power plants
- An overhaul of the national power grid for the much higher electric needs
- Massive expansion of domestic extraction operations
- Massive investments to keep air, water and soil protected from the drastic increase in industrialization (or we could just do the American thing and deal with it on the back end with increases in cancer, disease, healthcare cuts and health insurance denials)
- Millions of additional immigrants to supply the needed labor (at the same time we are vilifying, dehumanizing, imprisoning and deporting immigrants under inhumane conditions). This is in addition to the millions of U.S. citizens we presume will enter the workforce to work in manufacturing. Or maybe we think we’re just going to forcibly shift citizens en masse from better paying jobs to work on sewing machines, conveyor belts and other machines while experiencing economic contraction, which would undermine the whole idea that we are doing this in large part to become more prosperous.
- None of this accounts for the thousands of additional engineers we would need.
- A massive increase in immigration administration to process the massive influx of immigrants
- Literally millions of trucks, specialty haulers, railcars, ships and barges
We're talking about trillions of dollars in public investment for just half the finished goods that fuel our current economy.
And here’s the kicker: It would probably take a decade or more for all of this to be in place. And we’re still only talking about half (quite a bit less than half in a decade from now).
Except we would be paying steep import taxes which would drastically increase the price tag while making everyone’s expenses higher and their wages lower. Tariff revenues collected by the federal government cannot possibly offset the economic costs. Even if they magically could, it would take a decade or more for the bloodletting to ease even a little.
You haven’t heard about any of this because none of what we are witnessing has been thought through. There is no plan. We are simply subject to the whims of a narcissistic madman who, according to many of his former advisors and officials, does not read, fails to grasp basic concepts, and needs things to be communicated to him with pictures.
It is truly the “inject bleach to treat covid" equivalent for the economy.
And the cult members will continue to nod their head and insist it is all just 9D chess that mere mortals cannot comprehend.
But the rest of the world is not stupid. They realize that America cannot be trusted. It might take time, but the nations of the world will methodically work toward creating a new order that is no longer led by the U.S. Because even though Trump will be gone one day, the mind virus that put him in power may not.
