Legendary Economist Walter Block Talks Trump, Trade, and Tariffs

Editor’s note: This is part one of a two-part series.

Work, not welfare. This is the message emanating from American farmers after President Donald Trump and his administration recently announced a $12 billion bailout package for agricultural producers. Industry leaders, public officials, and trade associations are encouraging the president to abandon his trade war and grant farmers access to foreign markets.

Legendary economist Walter Block agrees with this sentiment, writing in The New York Times that “using tax dollars to bailout farmers” will not strengthen the national economy. Block has joined the growing chorus of economists from all schools in opposing the White House’s protectionist policies, arguing that it will only hurt Americans and leave behind scores of victims.

Block, the author of Defending the Undefendable, spoke with Liberty Nation about his op-ed titled “Trump’s Fake Fix for a Bad Economic Policy,” tariffs, international trade, and the 2018 mid-term elections.

Liberty Nation: Many of President Donald Trump’s supporters say that his use of tariffs is merely a negotiating tactic to get a better deal for Americans. With European Union (EU) Commission President Jean-Claude Juncker agreeing to buy more U.S. soybeans and to consider lowering tariffs, isn’t this an example of the president using tariffs as leverage?

Walter Block

Walter Block: Well, it might well be. Now, I believe it would be if it was Ron Paul as president, and I wish you were president, but we got Donald Trump. I believe that Donald Trump is, at heart, a protectionist. I don’t think he’s a free trader like I am or like you are or like Ron Paul is, and he’s just using the threat of tariffs and saying, “Look, I want full free trade, but you guys are bad guys. You want the tariffs. I’m gonna really tariff you up the kazoo or attempt to get you to stop doing tariffs.”

I don’t believe that that’s what he’s doing. He might say that is what he’s doing, but I don’t believe he’s doing it, and also I think it’s a problem because what a tariff is, is a tax on imports, and taxes are not really compatible with the nonaggression principle. So, in order to do this, what he’s really doing is saying, “Well, look, you’re taxing your people, so I’m gonna tax my people in order to get you to stop taxing your people.” Well, that’s not really compatible with libertarianism, even though we stipulate that that’s what he really has in mind. So, I’m saying even if that’s what he really has in mind, which he doesn’t, it still wouldn’t be compatible with libertarianism, and I’m a libertarian so I only support libertarian things. So, I guess my view is that even if it were true, which it isn’t, it would still be not acceptable.

LN: In your piece you quote economist Milton Friedman, who advocated for “a unilateral declaration of free trade with all nations, regardless of their own restrictions on international trade.” Recently, President Trump encouraged all countries to abandon trade restrictions and remove all trade barriers. What do you make of these comments?

WB: Wow, I didn’t hear that one. That’s magnificent.

LN: Yeah, he spoke to Prime Minister Justin Trudeau about removing all trade barriers and he encouraged all the European countries to get rid of the tariffs.

Milton Friedman

WB: Bless him. I mean, this is magnificent. Of course, if he were a football player, he’d be a broken-field runner. First, he zigs this way, then he zags that way, so I’m not sure we can believe him, but if that’s exactly what he said, God bless him. That’s magnificent, to say that … He’s now Ron Paul’s buddy. He’s now my buddy. This is great! I don’t believe it, but I’m willing to be convinced and if he keeps saying it over and over again and he keeps acting on it, that would be great, but one way to act on it is to just get rid of all of our tariffs, ignoring what other countries do and say, “Look, I’m a Milton Friedman-ite now or I’m a Murray Rothbard-ian and I’m against all tariffs and the U.S. is now stopping all of its tariffs and we might as well get rid of the subsidies while we’re doing this, and we might as well usher in the new libertarian era at least in international trade.” This is magnificent.

LN: You mentioned about getting rid of all tariffs. Now, a lot of Trump supporters, they will make the argument that all the other countries are applying tariffs on U.S. exports, so why shouldn’t the U.S. government apply their own series of tariffs? How do you respond to that?

WB: Well, look, suppose you and I were sitting in a rowboat and I, like an idiot, shot a hole in the rowboat and now a little bit of water is seeping in. Should you shoot another hole in the rowboat? No, don’t, don’t! We’ll drown. You know, just because one guy is an idiot doesn’t mean that the second guy should be an idiot. Just because other countries are acting idiotically and interfering with the free movement of goods and services and investments doesn’t mean that other people should do it, so just because they’re stupid and evil doesn’t mean we should be stupid and evil. We should be smart and virtuous, and smart and virtuous means getting rid of all tariffs.

LN: You know, I remember that rowboat analogy you made, I think it was last year at a tech company with Robert Wenzel. I’ll use that from now on in my articles when I quote you.

WB: Good, good. Well, I think it’s a very good quote.

In the second part of this series, Walter Block talks about foreign trade, how the trade spats will impact the coming election, and how the U.S. is a protectionist country.