Trump's Flawed Tariff Proposal
(Bart S. Fisher) - Former President Donald Trump has proposed replacing the federal income tax with tariffs imposed on imported products. Indeed, this is the central pillar in his campaign's economic program.
There are four problems with this flawed proposal.
First, it would trigger a global trade war, as other countries would surely retaliate with their own tariffs. It was the protectionist Smoot-Hawley Tariff Act of 1930 that contributed to the Great Depression, which occurred when other countries retaliated against the draconian tariffs imposed by the United States. Far from Making America Great Again Trump's tariffs would bring America a Great Depression again. It is the consensus view of economists and economic historians that the passage of Smoot-Hawley dramatically worsened the effects of the Great Depression. We should remember the wise words of George Santayana, who said that "Those who cannot remember the past are doomed to repeat it.".
The second problem is that the president does not possess the legal authority to replace the income tax with tariffs. Under Article 1, Section 8, Clause 1 of the Constitution, known generally as the Commerce Clause, Congress possesses the plenary power over the the collection of taxes and the regulation of foreign commerce, including the power to "lay and collect Taxes, Imposts, and Excises," unless and until it delegates such power to the Executive Branch. Moreover, an attempt by Congress to delegate across the board tariff-making authority to the president would surely be struck down by the courts as an impermissibly broad delegation of authority.
The third problem is that the tariff is essentially a regressive national sales tax that would discriminate against lower income consumers and permit corporations and higher income Americans to escape paying their fair share of taxes. American consumers would see higher prices and increased inflation as a result of the Trump tariffs. Contrary to Trump's repeated erroneous assertions, tariffs are passed along in large part by importers to consumers.
Fourth, replacing the income tax with tariffs would be irresponsible fiscal folly, as tariffs imposed on goods alone could not raise the revenues required to run the federal government. America is a service-based economy, with 77.6 percent of its Gross Domestic Product (GDP) coming from services in 2021. Indeed, the reason the federal income tax was instituted by the 16th Amendment in 1913 was that tariffs alone could not adequately support the activities of the federal government. The purpose of the federal income tax is to pay for the essential services of the federal government, including defense, highways, supporting the justice system, social security, and providing services that benefit all citizens, who could not provide such services very effectively for themselves.
In a nutshell, replacing the federal income tax with tariffs is a simple proposal from a simple mind designed to soak the poor. It ignores the lessons of history, a major symptom of Trump Derangement Syndrome.
* Bart S. Fisher is a lawyer in Washington, D.C. He was nominated in 2019 and 2020 for the Nobel Peace Prize.
Get Top Stories Delivered Weekly
Recent neiuindependent News Articles
Discuss This Article
GET TOP STORIES DELIVERED WEEKLY
FOLLOW OUR NEWSPAPER
LATEST NEIUINDEPENDENT NEWS
RECENT NEIUINDEPENDENT CLASSIFIEDS
OUTSIDE THE LINES
- Keep Your Home Safe from Fires and Other Emergencies...
- Simple Hacks to Make the Holidays Merrier (and Cheaper)
- A Dog Trainer’s Tips for a Safe, Fun Holiday Season w...
- What Are Dual Eligible Special Needs Plans (D-SNPs)?
- Improved Insulation + Heat Pump HVAC Can Mean Big Savings
- Making Wintertime Energy Management Easy
- Making Wintertime Energy Management Easy
- Diabetes is More Common Than You May Realize
- African Americans Are 60% More at Risk for Diabetes than...
- Hispanic Americans Are More at Risk for Diabetes Than Are...
FROM AROUND THE WEB
- BookTrib’s Bites: Four Fantastic Reads to Close Out Fall
- Cozy and Connected – How to Make the Most of Satellite I...
- Engaging Two-Book Coming-of-Age Saga Amid Middle East’s C...
- Donate to Marine Toys for Tots on Giving TOYSday!
- Exchange of Emerging Technology Ideas Draws a Crowd in...
- BookTrib’s Bites: Kick Off the Holidays with These Four E...
- New Year’s resolutions for your financial health: tools t...
- How to Use Thermally Modified American Hardwood in Your Home
- Tips for Travel with Toddlers and Babies
- The Science of Flexibility: Innovative Technology in Eyewear