In “A User’s Guide to Restructuring the Global Trading System,” Stephan Miran makes a compelling case that — contrary to popular belief — tariffs can achieve a multitude of aims without causing inflation or market volatility.

Miran begins his case by stating that the U.S. dollar is heavily and consistently overvalued because “dollar assets function as the world’s reserve currency.” When the U.S. dollar is strong relative to other currencies, imports become cheaper but domestic manufacturing suffers greatly.

The weakening of domestic manufacturing has several knock-on effects that add to a general feeling of economic discontent among many Americans — this discontent was, in large part, responsible for the re-election of Trump. Local economies, once dependent on manufacturing jobs, wither and become increasingly dependent on federal aid and/or narcotics to cope with the barrenness of their new reality.

Read the article.