The Connection Between Tariffs and Imperialism

A word about autarky. Autarky is a term related to autocracy, but instead of describing a form of iron-fisted political rule by one person, it relates to economic self-sufficiency. It's essentially a description of the policy that trump seems to be pursuing with the widespread imposition of import tariffs. As he puts it constantly, America has been economically 'ripped off' or 'treated really badly' or 'subsidizing other countries' - if there is one thing that trump has been completely consistent about it's believing he is always a victim. 

But the stated rationale seems to be to encourage international companies who sell product to American consumers to move their production facilities to the United States to create jobs. In theory that makes some sense, and historically tariffs have been used in a more surgical fashion to protect particularly vulnerable domestic industries by raising prices on cheaper goods coming into the market. One recent example is the 100% tariff imposed on imported Chinese electric cars designed to protect American electric car manufacturers. 

Import tariffs have two primary impacts: First they raise prices on imported product to make more expensive domestically produced merchandise more competitive, and second, they raise revenues for the government, like a federal sales tax would. The inflationary effect is why import tariffs have generally been used by government very sparingly. There is a lot of speculation that trump's blanket approach, which he says is aimed at protecting American industries and bringing manufacturing home, is actually meant to maximize government revenues (through his 'Exterior Revenue Service') to offset the cost of continuing his first-term income tax cuts which are scheduled to expire in 2025. One problem is that it's self-contradictory, the inflation generated by tariffs would produce a slowdown in the economy which would result in a drop in revenues from tariffs. Another problem is that an increase in unemployment would necessarily follow, so-called 'stag-flation'. These would be the short term impacts of tariffs felt very soon by Americans. In the medium term, if the policy did succeed in encouraging companies to move their manufacturing facilities to the US - a process that would take at least a half decade or more - the cost of producing domestically is inherently higher than producing overseas and consumers would pay that price.  

In other words, the plan is economically disastrous in both the short and medium term. But that's not the worst of it.

There's a political side to this terrible economic approach. Countries pursuing economic self-suffiency, even if they have established the factories and manpower, require natural resources. They need inputs from other places that have what they don't have. What to do? Can't trade with other countries because that goes against the goal of self-sufficiency. The only answer is to take them. Autarky and Imperialism go hand in glove, hence trump's interest in absorbing Canada and 'buying' Greenland, two places rich in minerals and energy, and why his threats need to be taken deadly seriously. It's not just rhetorical disrespect, or a distraction away from other disastrous headlines like Signalgate, although it's that too. If trump is serious about autarky then he's also serious about subjugating Canada and Greenland, and the sooner we acknowledge it the better.