Just as FDR’s feckless failure to support the recommendations of the post-WW I London Conference set the stage for WW II1, so does Trumph’s2 bombastic, bullying of other countries’ economic policies (and his feckless, political fellatio of Putin) set the stage for World War III.
This is not an unfounded, partisan, or alarmist assertion.
Hayek is to Political/Social Economy as Bastiat is to Economics (both agree Tariffs are taxes and on the adverse economic effects to the consumer) – as Asimov is to Physics – as Adler is to Morals and Virtue.
His book The Road to Serfdom is the gold standard for explaining the trend toward Totalitarianism not only in many European countries but also within both Political Parties in the United States. While every page in the whole book is worth quoting, just one paragraph explains succinctly why Trumph’s Tariffs are dangerous:
“If the resources of different nations are treated as exclusive properties of these nations as wholes, if international economic relations, instead of being relations between individuals, become increasingly relations between whole nations organized as trading bodies, they inevitably become the source of friction and envy between whole nations.
It is one of the most fatal illusions that, by substituting negotiations between states or organized groups for free market competition for raw materials, internal friction would be reduced. This would merely put a contest of force in the place of what can only metaphorically be called a [Supply and Demand] “struggle” within open competition and would transfer to powerful and armed states, subject to no superior law, the rivalries between which individuals had to be decided without recourse to force.
Economic transactions between national bodies whose [leaders] are at the same time the supreme judges of their own behavior, who bow to no superior law, and whose representatives cannot be bound by any consideration but the immediate interest of their respective [leaders], must end in clashes of power.”
– Professor Lionel Robbins, Economic Planning and International Order (London MacMillan, 1937); F.A. Hayek, The Road to Serfdom, 1944; Chapter 15 The Prospects of International Order, p. 224
Let’s hope the U.S. Supreme Court will have enough familiarity with economic history to forestall the consequences of Trumph’s Tariffs.
1 See: David A. Stockman’s The Great Deformation: The Corruption of Capitalism in America, 2013, 768 pages
2 “Trumph” is not a misspelling but this author’s portmanteau of Trump and “Humph!” (see “humph” in Merriam-Webster Dictionary)
