Tariffs (taxes) on imports harm a country's citizens regardless of what the governments of other countries do.
People think retaliatory tariffs mean:
”If another country charges a 20% tariff on our goods, we should charge a 20% tariff on theirs.”
Sounds like tit-for-tat response that balances the playing field, right?
But US citizens aren't at fault for the import taxes foreign governments impose on their citizens.
Therefore, if US citizens are innocent of any wrongdoing, on what grounds does the US government (USG) justify extorting hefty new taxes from them?
If mobsters in the next town over charge citizens 20% "protection money" on all non-mob goods upon arrival, would you argue that _your_ town would benefit from a local mob charging your town's residents similar amounts of "protection money"?
Moreover, tariffs don’t necessarily harm other country’s businesses more than they harm our own. As John Stoj writes:
“1. Different industries, different impacts: Even if both countries charge the same tariff rate (say 20%), that doesn’t mean the effect is equal. One country might export high-end machinery (with thin margins), while the other exports cheap textiles (with fat margins). The same tariff hits those industries very differently.
2. Trade imbalances and volumes: If the U.S. imports far more from Country A than it exports to Country A, matching tariffs doesn’t create “equal pain” — it hits the country that exports more to the other much harder.
3. Supply chain reality: Modern global supply chains are so interconnected that tariffs on imports often hurt domestic businesses too. For example, if you tariff imported steel, you might hurt U.S. manufacturers who rely on that steel more than you hurt the exporting country.
4. Policy goals vary: countries have different reasons for tariffs — protecting infant industries, raising revenue, addressing environmental concerns — so “matching” might be irrelevant to those actual goals.
5. WTO rules & multilateral agreements: Reciprocal tariffs in bilateral terms ignore the broader trade frameworks countries are part of. Countries don’t just set tariffs unilaterally; they negotiate within global trade systems (like the WTO), where reciprocity has a much more complex, multilateral meaning.
Bottom line:
Reciprocal tariffs sound simple and fair in theory, but in practice they ignore the complexity of trade relationships, supply chains, economic structures, and policy goals.”
What about military supply chains? Doesn’t the military need to maintain local suppliers in the event of war, lest we be cut off by suppliers controlled by enemy government?
Let’s assume that our military should avoid sourcing critical components in the military supply chain from companies located in enemy states.
Maintaining military supply chain independence doesn't require that all buyers in the US be extorted with hefty new taxes (aka tariffs).
For example, the USG they could demand that all suppliers to the USG be based in the US. Some companies will step into the role (albeit almost certainly at a much higher than market price).
Or the USG could demand that all critical components be sourced from multiple friendly countries. That way, even if one country turns against the US, the supply chain can still be maintained.
The USG could also make the US a more appealing place to do business.
High corporate taxes, crushing regulations, and protectionist immigration suppression laws make it costly to operate in the US. Such costs force companies to move operations overseas, so that they can remain competitive on the global marketplace.
If those burdens were eliminated or reduced, many more companies would be located in the US in the first place.