Don’t tell Trump that border taxes are not protectionist

Here’s the Washington Post:

The leaks coming out of the Trump White House cast the president as a clueless child

All White Houses leak. Sometimes the leaks are big, sometimes small. But there are always people willing to talk to reporters about the “real” story or about why the chief executive made a mistake in regards to some decision he made.

That said, I’ve never seen so much leaking so quickly — and with such disdain for the president — as I have in the first six days of Donald Trump’s presidency. . . .

Time and again, the image of Trump pushed by his “aides” is one of a clueless child — someone who acts on impulse, disregarding the better advice of people who know better. We know he needs to be managed or else he will say and do stupid things, the message seems to be. We’re working on it.  .  .  .

Trump has shown that his tendency to obsessively consume media — especially cable television — is unchanged in the six days since he has become president. He appears to be making policy decisions via things he watches or reads. (Remember Trump’s famous/infamous statement that he got his military information and advice “mostly from the shows.”)

At odds with all of this, however, is the fact that Trump is both deeply proud and hugely image-conscious. Having to read and watch allegedly loyal “aides” casting him as a sort of feckless child constantly in need of guidance wouldn’t seem to be the sort of thing that would sit well with him. . . .

The frequency — and nature — of these leaks are yet another reminder that the Trump presidency is nothing like anything that’s come before it. There is no blueprint. We’re through the looking glass.

But my educated guess is that these leaks must be driving Trump absolutely crazy. And when he gets mad, history suggests he will try to get even. And quickly.

Of course I warned people of this a year ago, but was told I was “deranged” and that Trump is perfectly fine.  I look forward to the scene where our Furher discovers that his aides have sold him a bill of goods on how the border tax/subsidy would “protect” America.

Dear God!  I never realized that life could be so much fun.



34 Responses to “Don’t tell Trump that border taxes are not protectionist”

  1. Gravatar of ant1900 ant1900
    27. January 2017 at 07:03

    Trump’s only public statement has been criticizing the Republican border tax plan (“too complicated” he said). If anything, he had Spicer give a bumbling answer about it at the press conference to communicate to the House how stupid their plan is. Since everyone thinks he advocated for a tariff, he seems to have been right about it being too complicated.

  2. Gravatar of dtoh dtoh
    27. January 2017 at 07:07

    For Christ’s sake. It’s an opinion piece by one of the most partisan anti-Trump editorialists at the WaPo. There is nothing in the piece that remotely supports the premise of the headline other than the opinions and interpretations offered by the author. It’s a zero content piece by a totally hack partisan. It just looks silly posting such crap on your blog. Really!

  3. Gravatar of ssumner ssumner
    27. January 2017 at 07:36

    ant1900, This is a weird way of expressing your opposition to the border tax:

    “After the speech, in a brief, impromptu news conference as Mr. Trump flew back to Washington, Mr. Spicer told reporters that the president now favored the plan to impose a 20 percent border tax as part of a sweeping overhaul of corporate taxation. Only last week, Mr. Trump had dismissed the tax as too complicated, favoring his own plan to impose a 35 percent tariff on manufactured goods made by American corporations in overseas factories.”

    But then Trump is a weird guy, so maybe you are right.

    dtoh, Everything I see out of Trump is 100% consistent with the leaks coming out of the White House. Not sure why others can’t see what an idiot Trump is. It’s plain as day every time he opens his mouth.

  4. Gravatar of Matthias Görgens Matthias Görgens
    27. January 2017 at 07:45

    Scott, I was almost surprised you linked to the original scene of the Untergang. I was expecting an economics related dub. (I am not sure anyone made one for protectionism. I found things like , but that’s about academic research.)

  5. Gravatar of Matthias Görgens Matthias Görgens
    27. January 2017 at 07:52

    Scott, you might derive some guilty pleasure from this one

    (But I do admit these are funnier, if you understand the spoken German contrasting with the subtitles.)

    I am considering retreating from my prediction that just as Obama was generally OK, but not the Messiah some people expected, Trump while generally awful won’t be the quite the Anti-Christ either.

    But I remain hopeful for now.

  6. Gravatar of david david
    27. January 2017 at 07:56

    Democrats need to be prepared to make every compromise to get a President Pence. It’s depressing but that’s what this is coming down to. Get Trump out of there to protect the Republic.

  7. Gravatar of ant1900 ant1900
    27. January 2017 at 08:21

    Scott, I disagree with how the story has been reported and I went back to look at Spicer’s full quote. He was giving a hypothetical application of how the House plan could be used to make Mexico “pay” for the wall. I have not seen a statement from Spicer or Trump saying that they now support the House plan. It was a bad answer by Spicer and a complete failure by the press to ask obivous follow up questions. The obivous follow up is to ask whether Trump now supports the House plan, but it didn’t get asked.

    The only statement we have direct from Trump is his criticism iof the House plan. If that changes I’ll admit I was wrong. But I believe that at the moment Trump is in a bit of a struggle to avoid passing a lot of what Ryan wants, including this tax plan.

  8. Gravatar of ant1900 ant1900
    27. January 2017 at 08:24

    For example, the statement in your quote that “the president now favored…” is not at all supported by the transcript. He (Spicer) was clearly offering a hypothetical.

    Let’s just say I have great professional interest in tax reform and I have been following the developments very closely.

  9. Gravatar of foosion foosion
    27. January 2017 at 08:28

    What I’m hearing from the Trumpkins these days is that you have to watch what he does rather than listen to what he says.

    This of course ignores the importance and effects of communication from the president and administration. Looking at what he does is not any more reassuring.

    We also get this from the chair of the House science committee, “Better to get your news directly from the president,” Smith said. “In fact, it might be the only way to get the unvarnished truth.”

  10. Gravatar of Massimo Heitor Massimo Heitor
    27. January 2017 at 09:39

    Don’t tell Professor Sumner that economic sanctions normally involve tariffs and border taxes. And even patriotphobic economists don’t object to this.

    Is that considered protectionism?

  11. Gravatar of Massimo Heitor Massimo Heitor
    27. January 2017 at 09:53

    BTW, According to Trump, WaPo is “fake news”. He’s right.

    Here’s a Sassy Trump voice over version:

  12. Gravatar of Massimo Heitor Massimo Heitor
    27. January 2017 at 10:02

    Sorry, that clip was Trump calling CNN fake news. WaPo is fake news too though.

  13. Gravatar of Scott Sumner Scott Sumner
    27. January 2017 at 10:24

    dtoh, Does the stunt Trump pulled yesterday with the President of Mexico seem “normal” to you? Or the behavior of someone who has no business being President?

    Matthias, I’m probably one of the few Americans who saw that film at the theater when it came out. The parodies are generally pretty good.

    David, Yup. It would drain all the fun out of blogging, but of course it’s best for the world.

    ant1900, OK, I’ll defer to your greater knowledge on this until it gets clarified. Very confusing.

    BTW, what’s your view on the border tax idea itself?

    Massimo, It’s a border tax/subsidy—you do know the difference, don’t you?

  14. Gravatar of Jim Glass Jim Glass
    27. January 2017 at 10:57

    I never realized that life could be so much fun.

    Oh, I have and have been looking forward to it. I told all my friends during the election that I was rooting for Trump for the entertainment value (and for a Sanders-Trump finale.) As a lifetime NYCer I well remember, back during his bankruptcy days, Trump physically attacking Don Imus at the US Open tennis tournament after on the radio that morning Imus asked him, “So Donald, how’s it feel moving from the back seat of the limo to the front seat?” It’s a bit surprising that video never turned up during the election. But what could be a more fun personality in a President?

    And there’s just as much fun watching the hysterical left respond. Which makes double the fun!

    Here’s Acemoglu, no less, comparing The Donald to Putin, Chavez, and Erdogan — and naming Tump *the* unique threat to US political institutions …

    “Trump appears to share several political goals and strategies with Chavez, Putin, and Erdogan….” Ha, Ha, like what? Did those guys inherit a billion dollars from dad and then dedicate the rest of their lives to poufing up their hair into the greatest, greatest, hair pouf ever?

    “Not only are America’s institutions particularly ill-equipped, in this moment, to stand up against Trump; in some cases they may actually enable him … And so it follows, in turn, that the check on presidential power from an independent judiciary, the second leg of the separation of powers stool, is also unlikely to hold up…”

    Ye gods! I really like Acemoglu’s academic work, but when he tries to apply it to real world situations he goes consistently loopy, and here he’s gone full loop-the-loop. Trump doesn’t have the political skills to undermine the institutions of a cub scout troop to seize control of it. And unlike the other three guys, he *never* has given *any* indication that he has. Entirely to the contrary!

    OK, “cub scout troop” is rhetorical but “local community board” is literal. When Trump was going for his biggest, most ambitious and most famous construction attempt of his life, he was totally rolled and publicly humiliated by the local community board of average Joe and Jane Blows, then to his great cost lost a public spitting match with mayor Ed Koch (who knew a bit about political institutions).

    How Trump Bungled the Deal of a Lifetime. Yo, Daron, can you name any Putin / Chavez /Erdogan peformances like that one? How often were *they* rolled by local community boards and mayors? Talk about all-reality defying fact-free political hysteria…

    No, professor, you were wrong to mock that National Review cover for mocking the Left’s reaction to Trump. There’s nothing inconsistent in it – mocking all that deserves to be mocked is the only consistent policy.

    I recently saw an esteemed group of historians from around the world on C-SPAN 3 (I may have been the only person who saw them) talking about the extraordinary robustness of the USA’s constitutional system — the longest-running constitutional regime in the world (no, not the Brits’) and the most successful too (look where the USA started and where it is now), with no end of its running in sight. Yet one treated with contempt by so many USAers who benefit from it, as they endlessly go on about “we’d really be better off with a parliamentary system, the kind that regularly produces really effective leaders like Putin, Chavez, Erdogan … Mussolini, Hitler, and really gets things done for the democratic majority of voters, without political gridlock, when not producing 30 governments in Italy in 10 years”. Frankly, I’ve never understood that. (I’d give a link to the talk but the comment system here don’t seem to play well with three in a post.)

    And now we have Acemoglu, a guy who’s entire career is based on his mastery of institutions, claiming that this same US constitutional system, which has survived civil war, economic-technological-social revolutions, the Great Depression (which ended regimes across the whole rest of the world) now faces its most mortal danger from … TRUMP!

    I could be wrong, but I’ll place a Caplan/Alexander bet: 15 years from now all will be well and the US constitutional regime will have yet again proven its extraordinary robustness by surviving another *unique* challenge just fine. Not a challenge of war, economic crisis, or social revolution, the same old-same olds — no, the challenge of having had Cliff Clavin as president.

  15. Gravatar of Christian List Christian List
    27. January 2017 at 11:36

    Don’t tell Trump that border taxes are not protectionist

    Have you considered that Trump knows this quite well? Maybe he got other goals. Like pleasing his voters for example or putting pressure on the Mexican government (that totally seems to fall for it btw).

  16. Gravatar of Jeff G. Jeff G.
    27. January 2017 at 11:39

    I think a lot of what’s missing from this discussion is why target Mexico so directly? If it’s about “Made in America” why focus just on Mexico? And by the time any wall is built, we’ll probably have net emigration to Mexico. It seems clear to me that he’s using the trade and immigration issues as vengeance for personal grudges.

  17. Gravatar of Christian List Christian List
    27. January 2017 at 11:45

    Moneybox on explains the technical details quite well:

    Trump’s personality needs to be considered as well. From his past (and his books like Art of the Deal) we know that he can be dealt with if you approach him correctly. The Mexican government doesn’t seem to know this. Let’s hope Theresa May is better prepared than the Mexican government. The UK and Mexico seem to need the US more than the other way round.

  18. Gravatar of foosion foosion
    27. January 2017 at 12:33

    Krugman on the economics:

    USA Today on effect on prices:

    I see this as essentially a sales tax to be used to offset tax cuts for the best off. Border taxes might sound good to the Trump voters, but will raise their prices without doing much useful for them. To the extent it allows for federal income tax cuts, the vast majority of them won’t benefit much, given how few pay federal income taxes in any meaningful amount.

  19. Gravatar of msgkings msgkings
    27. January 2017 at 12:52

    @foosion: that’s the saddest part to me. Trump isn’t Hitler, he’s not Putin, he’s not going to wreck the country. He is going to do pretty typical Republican stuff: cut taxes, cut regulations, with some protectionism and infrastructure added in. Some of that will be good, but for the well off. The people that got him elected are going to be very disappointed how little their lives change.

    I suspect that’s not as important as feeling heard and respected. Trump’s genius is having figured that out. So he can cut his own taxes.

  20. Gravatar of Massimo Heitor Massimo Heitor
    27. January 2017 at 14:57


    I read this article and followed everything:

    Those are interesting tax policy ideas that have been in the works for a while from the pre-Trump Republican party. I’m not sure of the point you are trying to make.

    “Does the stunt Trump pulled yesterday with the President of Mexico seem “normal” to you? Or the behavior of someone who has no business being President?”

    No, it’s not “normal” and politics as usual and that’s the point. Yes, Trump has precisely the behavior of the leader that we need. Shake up the complacent elite with a creative reset. Fresh faces, fresh ideas.

    Calling Trump the Fuhrer and making all these Hitler comparisons is going to backfire on you when he doesn’t do anything terrible like that.

    @Jim Glass: Trump was a threat to some entrenched political institutions. That was the whole point. He drained the swamp. Now, his administration is the major US political institution.

    @Jeff G: “why focus just on Mexico?” Well, he’s not. He’s advancing ideas regarding relations with China the Middle East and Europe. He did make a specific pledge to have Mexico pay for the wall and that is one item he is addressing. He’s not using trade+immigration for personal grudges… His administration is pushing a clear philosophy of nationalism + patriotism.

    @Christian List: agreed.

  21. Gravatar of morgan warstler morgan warstler
    27. January 2017 at 16:25

    Since Trump’s Mexico SIN TAXES are coupled w massive cuts to income taxes…

    This is just moving from income to consumption, which is ALWAYS good and Scott knows it.

    Scott, you should jump to telling Mexico to adopt FIRST WORLD PROPERTY RIGHTS and end Article 27 so our capital can rush down there and turn it into #NewFlorida

    There will be no wall, when Mexico becomes unto us.

    It’s amazing how quickly someone who claims to be Libertarian turns against the MOST OBVIOUS private sector solutions.

  22. Gravatar of Jeff G. Jeff G.
    27. January 2017 at 16:55

    @Massimo Heitor: Just because he talked about it during his campaign doesn’t make it any less odd. Exactly what kind of general political or economic policy involves signaling out a specific country and demanding they pay you $15B? If it’s just about trade, where is all the animosity towards Japan, Germany, Ireland, Vietnam? Boeing wants to open up a factory in India, Tesla wants to open a factory in Europe, then Carrier want to open up a factory in….wait for it….Mexico and they are the ones who get their arms twisted. But that’s just a coincidence, right?

  23. Gravatar of dtoh dtoh
    27. January 2017 at 17:03


    1. The point is that Cilliza piece is a perfect example of the pervasive mendacity of the MSM. It’s one of the main reasons Trump got elected. The progressive media and political elite are fools for thinking that subtlety can disguise calumny. The public is not fooled. Reprinting this kind of crap journalism empowers Trump. (BTW – ant1900 correctly points out the deliberate misrepresentation of Spicer’s comments as a further example of the media’s dishonesty.)

    2. Your blog would be much more interesting if you stayed focused on policy rather than speculation about Trump’s personality (I can get that in the WaPo or NYT.)

    3. Normal – Would you want a QB with “normal” athletic abilities playing for the Pats?

    4. If you disagree with Trump’s approach to negotiating with Mexico, you might want to state why.

  24. Gravatar of dtoh dtoh
    27. January 2017 at 17:10


    Excellent point, and a good example of the terrible trade deals the U.S. has concluded, which don’t allow for the free movement of capital.

    Scott – you might want to take note and maybe do a post on the subtleties of trade policy. Simply repeating the “Trade is good… Protectionism is bad” mantra is not particularly interesting.

  25. Gravatar of Major-Freedom Major-Freedom
    27. January 2017 at 20:52


    Sumner, you are absolutely clueless about the MSM

  26. Gravatar of Dtoh Dtoh
    27. January 2017 at 21:02

    Wow. I’m flabbergasted. A post from MF that’s less than a thousand words.

  27. Gravatar of Massimo Heitor Massimo Heitor
    27. January 2017 at 23:00

    @Jeff G:

    That’s an easy one. The issue with Mexico is definitely not all about trade. It’s about giving Americans pride and respect. Vicente Fox called American workers lazy, tv watching, beer drinkers. The American media, political and university elites care more about not offending Mexican citizens than not offending American citizens.

    Secondly, American elites broadly told the American people that the only possible policy option regarding immigration from Mexico was to dramatically increase it and offer more rights to illegal immigrants. American elites said building a wall was impossible and wouldn’t even work. Trump is really proving them wrong and giving the common American people some pride and respect.

    The serious economic policy involving trade is the corporate tax overhaul led by Paul Ryan and Kevin Brady. I believe this Sumner post is saying, The Ryan/Brady tax plan is good, and it sounds protectionist but it’s not. Don’t tell Trump that it isn’t protectionist or it might lose his support.

  28. Gravatar of BolsaFamilia BolsaFamilia
    28. January 2017 at 06:41

    Is the Border Adjustment Tax quite green relative to the current corporate income tax? Would cars become 20% more expensive (assuming no pretax price adjustment to reduced demand)?

  29. Gravatar of dw dw
    28. January 2017 at 08:12

    and oddly enough one of MR T’s orders will terminate an agreement with the EU allowing companies the ability to keep EU citizens data. seems it allows agencies to keep non US citizens data. which violates EU law with out mandatory protections. which US companies dont actually do.

    and that border adjustment tax is for all products in the US, or it violates the WTO, which then allows any country to retaliate. so it would raise the price all not just cars, but any products being imported (wonder if it also applies to services). also would apply to all imports, like oil. and yes it would raise the cost of all taxed goods (and services) %20. and if demand and production were to be reduced, prices wouldnt necessary fall, they might go up, since lower production increases the cost of production

  30. Gravatar of ssumner ssumner
    28. January 2017 at 08:21

    Jim, Of course the US will do fine, we’ve survived much worse than Trump. So yes, the left is wrong about that. But Trump’s still a disgrace.

    You said:

    “There’s nothing inconsistent in it”

    Actually there is. I read the NR all the time, and they’ve gone from hating Trump to loving Trump, even though Trump continues doing the insane things they used to criticize him for. They are totally inconsistent.

    Christian, You said:

    “Have you considered that Trump knows this quite well?”

    Not likely, give that his trade advisors (Navarro and Ross) don’t know this.

    Jeff, I agree.

    Massimo, You said:

    “I’m not sure of the point you are trying to make.”

    Yeah, that’s pretty obvious.

    dtoh, I’d be glad to explain why Trump’s negotiating tactics with Mexico are wrong. The deal should be renegotiated to be more favorable to the Mexico. In the past, the US has bullied smaller countries in trade negotiations, and usually gotten its way. Trump seems determined to strike an even “better” deal for the US, which means more protectionist, which means worse for both countries.

    You said:

    “ant1900 correctly points out the deliberate misrepresentation of Spicer’s comments”

    Actually he did nothing of the sort. The fact that you claim he made that charge suggests that in this case you are even less reliable than the WaPo. Ant1900 clearly suggests the problem was confusion, not deliberate misrepresentation.

    Spicer is a joke of a press secretary; any misinterpretation is almost certainly his fault, not the fault of the media. Didn’t he say Trump got the biggest inauguration crowds in history?

    And what would be the motive for the press deliberately misrepresenting his views on an arcane subject like border taxes, which many economists don’t even understand? Do your really think that each morning the NYT and WaPo staff sit around plotting as to how to misrepresent Trump’s position on border taxes? I’ve chatted with reporters from both papers, and they seem like perfectly normal people to me. But then maybe I’m just naive to all the conspiracies going on out there. 🙂

    Let me also make a point regarding commenters in general, not you specifically. The level of inaccuracy in the comment section of this blog is several orders of magnitude higher than in the NYT or WaPo. This blog’s comment section is riddled with inaccuracy.

  31. Gravatar of Jim Glass Jim Glass
    28. January 2017 at 09:38

    Jim Glass: Trump was a threat to some entrenched political institutions. That was the whole point. He drained the swamp.

    Already, in just 7 days? Couldn’t have been much of a swamp.

    Now, his administration is the major US political institution.

    Look up the meaning of the words “political institution”.

    Then, if you still really *mean* that Trump is “a threat to entrenched political institutions” — such as the independent judiciary, separation of powers, two-party system, Constitution itself — hey, you’re on Acemoglu’s side!

  32. Gravatar of Philo Philo
    28. January 2017 at 10:24

    “I never realized that life could be so much fun.” If you can avoid dwelling on the tragic and the pathetic consequences, politics is intensely entertaining! (But it was rather entertaining even before Trump.)

  33. Gravatar of Jeff G. Jeff G.
    28. January 2017 at 14:10

    @Massimo Heitor:

    So Trump is defending Americans against some disparagning comments from Fox? Really, that’s your answer? Nevermind he said that after Trump set his sights on Mexico, nevermind most Americans probably aren’t even aware he said that, nevermind most people aren’t that sensistive, nevermind I have met a lot of Trump supports and no one has brought this up before. Sorry, I don’t buy it.

  34. Gravatar of Massimo Heitor Massimo Heitor
    29. January 2017 at 12:42

    @Jim Glass: I am in favor of the independent judiciary and separation of powers. I’d like more devolution of power, not less. I’m not sure where you are suggesting the opposite. I never heard of Acemoglu before and skimming his wikipedia page, I can’t quickly categorize him.

    @Jeff G: You are right that single incident of Fox insulting American workers is a somewhat fringe event. I casually remember him flipping off Trump and disparaging both Trump and Bush 43. The bigger issue is that the universities who are chartered as the intellectual leadership of US citizens are generally more concerned and interested with the citizens of Mexico and refugees from Syria than the citizens of the US.

Leave a Reply