Mackinac Center: No One Will Win The Tariff Game

Most games are zero-sum, meaning there is a winner and a loser: Someone goes home with the prize, while someone else goes home empty-handed. President Donald Trump appears to see trade as a game of this nature. But unlike football, there are no winners in a game of tariffs, and Michigan may be the biggest loser of all. Despite attempting to promote the national economic welfare, Trump’s tariffs will instead harm Michigan’s economy and the United States as a whole.

A tariff is a tax on virtually everyone except the industry it aims to protect. Since the beginning of this year, Trump has instituted protectionist policies to try to stifle foreign competition to domestic goods. Billions of dollars’ worth of tariffs have been introduced on imported goods, including steel and aluminum. These taxes have led countries like China, Mexico and Canada to reciprocate with tariffs of their own.

China recently enacted 128 tariffs on American-made goods. This tit-for-tat hits Michigan hard, especially in the automotive, plastics and pharmaceutical industries. A Brookings Institution report found that when the tally of Chinese tariffs is taken, Michigan will be the fourth-hardest hit state. China’s tariffs are projected to kill 91,000 jobs, 23,000 of which are in Wayne and Macomb counties. The vast majority of jobs lost statewide would be in automotive production.

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