During President Donald Trump’s first term, economists wrongly predicted disastrous inflation from increased tariffs. Instead, inflation averaged just 1.9 percent while real wages rose. While inflation has increased significantly in recent years — with the Consumer Price Index now up nearly 20 percent — this has been driven largely by the Covid pandemic, supply-chain shortages caused by the Ukraine war and the fact that the United States produces fewer goods than it should.

Nonetheless, the typical pro-free trade economic analysis has been wrong for years. The free trade view of buying cheap imports regardless of the impact on domestic employment and the industrial base is now being rightly rejected by both parties. Indeed, Nobel laureate Paul Samuelson argued that protectionism is beneficial for growth when an economy is operating at less than full capacity and that “tariffs can then reduce unemployment, can add to the [GDP], and increase the total of real wages earned.”

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