Senator Mike Lee was interviewed today by Forbes on the issue of Trump’s tariffs. In the interview Mike Lee explained why he opposes Trump’s proposed steel and aluminum tariffs:
Stuart Anderson: You released a statement opposing the president’s announcement to raise tariffs on steel and aluminum. Why do you oppose the plan to raise tariffs?
Senator Mike Lee: I oppose it because it will harm the American economy. I’m heavily influenced by the memory of my grandfather, who was a Treasury enforcement officer. One of his jobs was to enforce the Smoot-Hawley Tariff Act. He used to say with a twinge of guilt in his voice that it was that very aggressive enforcement that helped lead to a global depression. He always warned me about the risks associated with a trade war.
I’m very worried about this or any other step in the direction of a trade war. It’s bad for American consumers and it’s bad for American workers.
Anderson: On the proposed steel tariffs, which are you most concerned about, the impact on consumers, U.S. jobs in steel-using industries or retaliation from our trading partners?
Sen. Lee: I can’t separate those. This kind of action has a tendency to create a vicious cycle that harms consumers and workers. By raising tariffs in one area we tend to encourage retaliation by our foreign counterparts, and that in turn puts us into a cycle that results in a trade war.
Lee goes on to explain that his new bill, called Global Trade Accountability Act, seeks to restore the proper balance between the branches of government on the issue of trade. He argues that Congress has delegated far too much authority on trade to the executive branch.
In a nutshell Lee’s bill would require “actions by the executive branch on trade, such as increasing tariffs, duties, etc., to be subject to a congressional approval process.” Meaning Trump couldn’t just act unilaterally on trade, as Congress would have to approve his actions.
Sounds great in theory, but it would most certainly need supermajorities to pass it as I’m sure Trump would never sign it.
When it came to what advice Lee would give the president, he plainly said “don’t start a trade war”:
Don’t start a trade war. Trade wars end up hurting consumers and workers in America. Even though you may be able to identify a certain company or industry where certain people might benefit from protectionist policies, in the aggregate you end up hurting a lot more American workers and a lot more American consumers than anything else.
Fine advice for our protectionist president. If Trump is so concerned about helping American workers, then he won’t do this. He needs to examine how his tariffs are hurting the lumber industry and prove that he’s as smart as he tells us he is by learning a lesson from it.