Are Tariffs Conservative or Not?

Episode Transcript

Speaker 1 (00:00):
Agent Squire's came up to me and was asking me
about the recent ruling from the d C Circuit about
tariffs and saying to me, it seems like the DC Circuit,
which blocked a number of Trump's tariffs, that this is

(00:20):
just more anti trump Ism, And I wanted to talk
about it because I don't think it's purely that there
have been a lot of judicial rulings over the last
six months seven months of the second Trump administration that
have been I think pure exercises of judicial angst. Judges

(00:41):
who don't like Trump's policies, who are finding any pretext
humanly possible to stop them, and reaching for really specious
grounds to stop Trump policies they don't like. And I
think the most ridiculous. There are plenty of ridiculous ex
examples to choose from over the last seven months, and

(01:02):
many of those ridiculous examples have been overturned by the
Supreme Court. I think the most ridiculous example is the
federal judge from Massachusetts who blocked the federal defunding of
Planned Parenthood. In the One Big Beautiful Bill Act, Congress

(01:23):
passed a law saying that abortion providers like Planned Parenthood
are ineligible to receive federal funding, ineligible to participate in
the Medicaid program for one year. It's Congress exercising its
power of the purse, setting the conditions for who is
and is ineligible to receive to participate in the Medicaid program.

(01:44):
And this federal judge just stopped it on the most
specious grounds possible. Not on the grounds that, oh, this
is a Trump executive order and does it he have
statutory authority? No, she just completely halted a congressional statute.
Clearly within congresses the scope of authority, Congress can clearly
decide not to spend money on something. I think that

(02:07):
was the most ridiculous one, and it was obviously superpartisan.
And a lot of this stuff is just partisan warfare
being fought out in the courts where liberals are suing
to stop Trump policies they don't like, and they are
trying to sue in courts in venues that are most

(02:27):
favorable to them because they know that the judges in
those courts are super partisan Democrat appointees. The Northern District
of California, the District of Massachusetts, the DC District, A
lot of these courts have just a big percentage of
the judges are super left wing. I don't know that

(02:52):
the tariff's thing is, so I want to talk about this.
I'm a little leery to discuss tariffs and economic policy
just because I feel like I'm not educated enough on
economics in general to give really strong opinions on it.

(03:14):
I guess the one foray into opinions on tariffs and
Trump's tariffs specifically are I don't think it's I don't
think I agree with the really libertarian, totally free market
types who say that they think there should be absolutely
no tariffs ever, that we should have totally free trade.

(03:37):
I don't think that's a good idea. I think that
statesmanship requires that you have some concern about where you're
buying your stuff, and a totally libertarian, free market approach
to international trade is totally agnot stick about where you

(04:01):
buy your stuff. If China or Russia produces the cheapest,
most desirable version of a product, you buy it from
Russia or China. The problem is that Russia or China

(04:22):
are Russia and China are geopolitical foes or geopolitical adversaries, rivals,
and so if you're hugely dependent on Russia and China
for things that are critically important like oil or computer

(04:42):
chips or military supplies or your energy sector. Then you
put yourself at a geopolitical strategic disadvantage by having a
totally free, totally unregular related market for trade, for international trade,

(05:05):
we shouldn't be reliant on Russia or China for energy
for this or that. So to have some kind and
especially when and you know, a totalitarian state like China

(05:26):
can undercut American workers with basically making two cents on
the dollar relative to an American worker near slave either
near slave labor or genuine slave labor to make equivalent
goods at a much cheaper price. That's not fair. And

(05:50):
you know that they're all kinds of concerns during COVID
about supply chains and about the kinds of you know
that we're are are we super reliant on the Chinese
for our pharmaceutical supply chain? Well? What if we get
in a war with China? What if China invades Taiwan
and all of a sudden we're fighting a war against
the Chinese? Okay, are we just going to the American

(06:12):
pharmaceutical industry is screwed being super reliant on a foreign
adversary for critical stuff for your supply chain is a
bad idea, and tariffs can be a tool for altering
the incentives of American importers and businesses for you know,

(06:39):
not getting stuff from China, not getting stuff from Russia,
not getting stuff from all these different places. Now we
were able to make some kind of geopolitical strategic decisions
about you know, we're not getting our oil from Russia.
For the most part, America has a lot of domestic

(07:00):
oil production, and then we sort of seem to be
reliant on the Middle East. I mean, from a big
scale geopolitical strategy, not being reliant on Middle Eastern oil
would be a great idea anyway, So I don't mind tariffs,
I guess in theory, I think there's the second level

(07:22):
question of whether Trump's tariffs, the specific tariffs Trump is imposing,
whether they are wise or not. But that's not even
what the courts were looking at. What the courts were
looking at, and so let me give you the posture
of this. A lot of Trump's tariffs are sort of
on hold because the d C. Circuit Court has said

(07:43):
that many of them were unlawfully imposed, that Trump did
not have the requisite constitutional authority to impose them on
his own. The DC Circuit, for those who't know, is
sort of the equivalent of It's at the same level
as like the First Circuit, the Second Circuit, the Third Circuit,
the Fourth Circuit, the Fifth Circuit. The d C Circuit
hears appeals from the d C District Court, and the

(08:05):
d C Circuit has its own circuit because there's so
much litigation that happens around actions taken by federal government
entities that are all housed in d C. So the
d C Circuit Court of Appeals again, it's kind of
at the same level as the Second Circuit, of the
Ninth Circuit, the Eleventh Circuit, et cetera. And a lot

(08:28):
of really significant you know, future Supreme Court justices were
judges on the d C Circuit. I believe Scalia and
Thomas and Kavanaugh were all judges on the d C
Circuit before they became Supreme Court justices. Now, what's interesting

(08:53):
is that the d C Circuit court ruling, it was
something like seven to four against President Trump against his
position of tariffs, and it didn't break down along ideological lines.
It wasn't just the Democrat judges all in the majority,
and it wasn't just the Republican judges in the minority.
There was actually kind of a mix for both. In fact,

(09:14):
the dissent sort of defending Trump's position, was written by
a Democrat judge. Trump has kind of tried to portray
it as liberal judges stopping what he wants to do,
but that's not really I don't think that's actually a
fair characterization of what happened. And it has to do

(09:36):
with actually this kind of constitutional question, does the president
have the authority to impose tariffs? Now, ordinarily the answer
to that question would be no. Tariffs and other kinds
of international trade policy, they have historically been within the

(09:59):
ambit of Congress. Congress who regulates international trade, interstate commerce
and international commerce is within the parameter of Congress. And
it's also it also kind of depends on how you
characterize a tariff. If you characterize it as a tax,

(10:20):
which is not a I mean, there's some people who
quibble over the language. You know, is a tariff attax?
I mean in a certain sense, yeah, it's it's the
government collecting money from a transaction mandatorily, and it is

(10:40):
imposed on American importers, so it's not just on the
foreign companies. It's imposed on the American importers, but obviously
that cost gets passed on to the foreign companies. If
it's a tax, then it's not something the president can

(11:02):
unilaterally impose. And frankly, even if if you're gonna say
tariff is its own kind of category of things, separate
from a tacks, Historically it's always been something regulated by Congress.
There's not any inherent statutory authority in Article two for
the president to just do this. Now there's some argument
I shouldn't say there's no argument for that. There's some

(11:24):
argument that maybe the president has some authority to do it.
The president completely oversees American foreign policy. Tariffs some have
a big role in foreign policy, but historically Congress has
always been the body that makes decisions about tariffs. President Trump, though,

(11:47):
claimed that he had statutory authority authority based on a
statute passed by Congress to impose various kinds of tariffs.
There was a law passed in nineteen seventy seven, so
a this is a Jimmy Carter era law, the International
Emergency Economic Powers Act. Basically, President tum this statute gives

(12:16):
the president in certain kinds of emergency situations. And this
is kind of the crux of the matter is are
we in any kind of economic emergency justifying this statute
kicking in and the president imposing tariffs. Basically, what President
Trump has said, well, this statute allows the president to
set tariff rates in a given economic emergency. I declared

(12:40):
an economic emergency, Therefore I can impose tariffs. And the
courts basically just didn't buy it. They said, well, no,
we're not in an emergency. You might dislike the situation
we're in, but this isn't an emergency. And Congress passing
this law in nineteen seventy seven does not give the

(13:03):
presidency forever and ever amen blanket authority to issue whatever
tariffs whenever they want, unilaterally without consulting Congress. That their
tariff authority is actually much more circumscribed than Trump wants
it to be. So the issue is actually not so

(13:24):
much or reflexive is Trump good or bad argument? It's
not even really a reflexive are tariff's good or bad? Argument?
The argument before the courts is really a question of, well,
what authority does the president have to impose tariffs? Because basically,

(13:48):
and this goes back to something about executive orders, I
think that a lot of people don't understand what executive
orders are. I think people all remember their schoolhouse rock
about I'm just a billious, I'm only a bill, and
I'm sitting here on Capitol Hill. They know in theory
how a law is made in America. The House passes

(14:11):
a thing, the Senate passes a thing, and the President
signs it, and then it becomes a law. People understand that,
but then they know that executive orders are out there,
and they don't really understand what an executive order is.
They think it's like some other third way of creating
a law that just kind of falls down from the
President's desk and then all of a sudden, it's a law.

(14:33):
An executive order is not some like secret extra way
of making a new law that you'd like to bypass Congress.
The idea is Congress writes laws, the president enforces them,
he executes them. So what an executive order is. Any

(14:55):
executive order has to ground itself in a law that
has already been passed by Congress. There's some law that's
been passed by Congress that gives the president a certain
kind of football field of activity. We want you to
do this and within these parameters, enforce this law. Now,

(15:21):
presidents have a certain amount of what's called executive discretion,
enforcement discretion, prosecutorial discretion, where they don't have to fully
enforce every law all the time, sometimes, especially for lack
of resources or something like that. You know, if every
DA's office prosecuted every single person who jaywalks, they wouldn't

(15:43):
have enough time man hours in the day to actually handle,
you know, murders. So there's a certain degree of discretion
that the executive has for enforcing every single law maximally
at every moment. But basically, an executive order is the
president saying, within the parameters of a law that Congress passed,

(16:04):
we're gonna do this, but they have to ground themselves
in something that Congress did. So Trump is trying to
argue this statute that Congress passed in nineteen seventy seven
under Jimmy Carter gives me the authority to issue all
these tariffs. And the fight is, well, does that statute

(16:26):
really give you that authority, mister president. Now, if that
statute from Jimmy Carter, if it said Congress delegates all
of its authority, all of its decision making authority about
tariffs to the President of the United States. Well, Trump
would have a stronger case. But that's not entirely what

(16:49):
it says. In fact, the iee PA, this Jimmy Carter Law,
the Internet Economic Emergency Powers Act, it actually doesn't really
talk about tariffs or duties at all. It doesn't really
talk about it. It gives the president the power to

(17:13):
regulate imports, but whether it goes all the way towards
giving the president the power to impose tariffs is a
bit much. Now, when we return, I want to talk
about like, are tariffs actually conservative or liberal? That's next
on the John Girardi Show. Did the DC Circuit stop

(17:38):
a bunch of President Trump's tariffs because they're liberals and
Trump is a conservative? Well, that's an interesting question. Is
a tariff liberal is a tariff conservative who actually dislikes tariffs,
who actually likes them. It's one of the more topsy

(17:59):
turvy political things in the Trump era of modern day
American politics, This idea that tariffs are now have this
conservative or right wing sheen to them, and not imposing
tariffs have this sort of left wing sheen to them. Now.

(18:20):
So here's kind of the the problem. But maybe one
of the problems is language. This is I there are
a lot of people who try to act sort of
holier than thou and smarter than thou by saying, well,
we use these crude terms of conservative and liberal, and
it's not a good way of understanding the world. And

(18:42):
oftentimes when people say that, they're just being blowhards. I
do think though, that the words become a little meaningless
when we're talking about economic policy or tariffs. Are tariffs
conservative or liberal? Well, you know, five minutes before Trump
came onto the scene in twenty fifteen, I think probably
the consensus would have been that Republicans all hated tariffs

(19:07):
because the Republican Party was loaded with libertarian economic thinkers,
total free market libertarian economic thinkers who like the idea
of maximal choice in economics and not restricting those choices

(19:28):
with what they view as centralized planning by the government.
That basically, they think of any government regulation on the
economy as tantamount to the central planning activity of the
Soviet state, where the Soviet state was setting the prices

(19:49):
of literally everything, rather than allowing the market to set
prices for things, which was a far better system, and
the central planning of the Soviet state was completely inadequate
to deal with the incredibly comp lex variations within the market.
If you increase you know, the cost of you know, resin,

(20:09):
or you increase the cost of wood, and all of
a sudden that is impacting shipbuilding that you didn't anticipate. Basically,
this was a constant problem that the Soviet central planners
had was they would alter the price of something and
would have these enormous impacts downstream that they just couldn't
have anticipated. And all in all, letting the market sort

(20:32):
of work itself out as far as prices was obviously
a better system than what they were doing now. I
think that all makes that makes much sense in general.
I don't know though, that it makes sense when it
comes to international trade. The idea that we should be

(20:54):
agnostic about whether we are buying pharmaceuticals from Canada versus
China is one of I think there's a big difference
between buying pharmaceuticals from Canada versus buying pharmaceuticals from China. Namely,
I'm not afraid of Canada ever attacking the United States
I'm not afraid of US being in a war with Canada.

(21:17):
So there is some geopolitical strategy, strategic priorities that international
trade can support or hinder. And I don't think you
can be agnost. I don't think you can just wash
your hands of that. And some kind of policy for tariffs,
for regulating trade would be a good idea. So but nonetheless,

(21:48):
being anti tariff was very much a Republican policy for
years and years and years, and being pro tariff was
very much a Democrat aligned policy. So yeah, at least
prior to the Clinton years. Prior to the Clinton years,
Democrats were very much in favor of tariffs. They wanted

(22:09):
to protect American labor. Democrats were the party of big labor.
They wanted to protect American workers. They wanted to keep
tariffs so that American workers couldn't be undercut by Chinese
slave labor. That you know, they didn't want. They didn't
want it to be easier for people to buy imported

(22:30):
goods from China made by Chinese practically slave laborers making
one cent on the dollar that every American worker makes
for the same product, and American workers getting undercut. They
they didn't, you know, they also sort of saw that,
you know, if let's you know, we'll say the Chinese.
If the Chinese are making, you know, chain saws, and

(22:52):
American workers in a factory are making chainsaws, and the
Chinese chain saws cost half as much, and we just
keep buying the Chinese chainsaw use Well, the American workers
at the American chainsaw factory, they're all going to get
laid off because their company is going to not be
as profitable. So those jobs will go away, and those
jobs will go to China. If you impose tariffs on

(23:16):
incoming Chinese chain saws and make it for the American
consumer or importer or a person who wants to sell
chain saws that they're the same price effectively, well you're
doing the work of protecting the American worker. So I
think there are long term macro economic, geopolitical benefits that

(23:39):
can accrue from certain kinds of tariffs, and at any rate.
That's why I find it hard to kind of characterize
myself as a total free trader. And in short, you know,
which is conservative, which is liberal, I don't know. I
mean Republicans tended to diss like tariffs. Democrats used to

(24:01):
like tariffs, now, I think Democrats just will oppose anything
that Trump says, but their inclination is to be kind
of pro tariff. So it's actually a very interesting way
in which American politics right now is very topsy turvy.
When we return more on tariffs and is it conservative
is at liberal? Next on the John Groarty Show, I

(24:21):
want to talk more about tariffs because it gets to
this interesting question about the nature of conservatism. All right,
and you know, are tariff's conservative are they not. It's
actually really interesting when you sort of study the history
of this concept of conservatism as a political movement, because

(24:48):
I think that modern day American conservatives assume it's kind
of like religion, like a religion in the sense of
it has a creed. Okay, if you're a Catholic, you
have a creed. I believe in one God, the Father Almighty,

(25:10):
Maker of heaven and earth, of all things visible and invisible.
I believe in blah blah blah blah, the Nicene creed.
Actually Catholics have we have like three different creeds. We
can use the Apostles creed, the Nicene creed, the Athenasian creed.
So to be a Catholic means yes, I believe in
a certain body of teachings about the nature of God,

(25:34):
the nature of his revelation, certain body of teachings about ethics,
that God has revealed certain things, and I have certain
duties and obligations towards God and my fellow man. There's
sort of static things that you actually believe, and that's
not really how conservatism has really operated. Conservatism is more

(26:02):
of an attitude and a mindset rather than an actual
consistent set of beliefs that are durable and lasting over
the course of centuries. As far as specific policy priorities,
it was actually like conservatives in Great Britain that fought

(26:25):
for the creation of and the maintenance of the National
Health Service, i e. Their version of socialized medicine. Conservatism
has been the label used for wildly different kinds of
economic policy. Conservatism has been the label applied to libertarian

(26:46):
free market economics, which had very historically been sort of
the domain of liberalism really, but nowadays, in the modern
American context pre Trump, laissez fair economics when it comes
to trade was conservatism. Free trade was a conservative position.

(27:09):
Now in the era of Trump, who knows being pro
tariff makes you more conservative? Somehow in most people's minds.
And that's because conservatism is not really an ideology. So
let me explain what that means. Ideology mean. I guess
within this context, ideology means a single set of beliefs,

(27:34):
in particulars that you think are universally applicable always and everywhere.
I always believe direct abortion is wrong, Okay, I believe
that as in I think that as an ideological point.
I don't think there are exceptions to the negative prohibitions

(27:58):
of the natural moral law. Okay, now we can get
into more detail on that, but that is something I
believe to be always true. Conservatism looks at modern day
political problems and does not approach them with an ideological perspective.

(28:21):
It does not look at, for example, tariffs as always
a bad idea. There are times when someone genuinely within
the classical conservative mold would say that we need to

(28:43):
allow greater leeway for economic actors to import, or at
some points they might say, well, from a geopolitical point
of view, we need to impose certain tariffs so as
to not give foreign adversaries sort of a chokehold on

(29:05):
critical American supply chains. We don't want the Chinese completely
governing our supply chain for pharmaceutical supplies, so we're going
to impose tariffs on certain kinds of Chinese goods to
address that problem. The anti tariff sort of libertarian free
market people are ideological about this. They are genuinely ideological

(29:27):
about it. They think tariffs are just always in everywhere wrong.
They think that it is and some of the really
intense libertarian thinkers get to the point of saying, well,
it human nature demands total freedom of choice. It's liberalism
as applied to economics. Liberalism meaning that the government cannot

(29:51):
impose any one objective vision of the good as being
normative on society. Government's only role is to provide individuals
with the maximal space to choose the good for themselves,
the freedom to choose the good for themselves, and then
this gets applied to economics, and these classical liberals libertarian

(30:14):
types apply this to economics to say, well, the American
consumer American businesses should have a totally free marketplace should
not be constrained by the government in any way in
their choice of the good as it comes to from
whom they will buy stuff. You should be totally free
to make your own economic decisions, even if that economic

(30:37):
decision is the result of the Chinese Communist Party manipulating
their labor markets to undercut American workers to produce, you know,
essential goods at a much cheaper price, even if it
means mining rare earth minerals for your solar panels, and
then you're totally reliant on the Chinese for solar energy
and for some stupid reason, you're having a massive transition

(30:57):
to solar energy. Blah blah blah blah blah. It's an
ideological thing for libertarians, like no no tariffs ever, because
it violates this fundamental vision they have of human nature,
humans enjoying maximal freedom of choice, and any government constraint

(31:17):
on that being bad. And that's just not how conservatism
sort of traditionally has been. And this is I think
some would argue kind of a weakness of conservatism. Conservatism
as a political idea, it is basically trying to respect tradition,

(31:38):
trying to respect ideas that have worked, trying to protect
what one has received. And the problem with that, I
think sometimes is that conservatism winds up just sort of
protecting yesterday's liberalism. You now have people self avowed conservatives

(32:06):
who are trying to make arguments that, like, you know,
it would be a radical act to overthrow Obergafell, the
Supreme Court decision from about ten years ago that said
gay marriage is the mandatory universal law of the land.
This has been established. People have relied on this, our
culture has accepted it, and it would be a radical thing,

(32:28):
a non conservative thing to do, to want to overturn Obergafell.
People are making that kind of argument right now, which
if that's what conservatism is, then I guess I'm not
really a conservative. And this has been one of the
problems with conservatism as an English an American political movement

(32:48):
is that it isn't really ideological. It's not sort of
it has adapted to this attitude of respecting what has
come before, preserving what has come before, leariness at utopian ideals,
all of which can be good things, I'd say, but

(33:12):
I don't know that it is provided a really stable
basis for anything. And when you look at say the
Conservative Party in Great Britain, the Conservative Party, the Tories,
you sort of see how ineffective conservatism is. Where you
have conservative MPs saying, you know, we want to have

(33:34):
a responsible system for physician assistant suicide, like like you know, ah,
like this idea that you're doing something by you know,
slightly slow rolling the radical ideology of folks on the left.
And that's why I kind of I don't know that

(33:56):
I'm always that interested in calling myself a conservative. I'm
a Christian, I'm a Catholic. One might say I'm a
person of the right, but I would say that my
political ideals are a bit more enduring and hardened fast

(34:22):
for stuff that really matters, and maybe my political ideals
are a bit more flexible for things that I think
don't matter. So and it's very interesting how modern American conservative,
especially these super libertarian types, they're very flexible when it
comes to social conservative issues. Ah well, you know, they're
totally willing to compromise when it comes to abortion, gay marriage.
That said the other but oh boy, you talk about tariffs,

(34:46):
and they're the most ideologically rigid people you've ever met.
They're more you know, they're as ideologically rigid about tariffs
as pro lifers are about abortion. Anyway, it's just an
interesting thing how I think this tariffs thing has really

(35:08):
come to this interesting discussion, at least in my mind,
about what is conservatism actually? Are tariffs conservative? Are they not?
Does conservatism really have much of a set meaning? I
mean conservatism prior conservatism, prior to the sort of Milton
Friedman era of nineteen fifties through twenty tens conservatism, the

(35:35):
prior conservatism to that, would have been quite okay with tariffs,
with making those kinds of economic choices as they relate
to international trade and the state craft implications of those

(35:55):
international trade decisions. Great conservative British I'm ministers like Disraeli
and others were you know, felt that tariffs were a
necessary and important thing. So it's this interesting, it's this
really interesting moment, and I think this DC circuit case

(36:16):
is kind of a classic example of it, where you've
got Republicans and Democrats both in the majority, saying that
Trump doesn't have this authority to impose tariffs. You've got
Republicans and Democrats in the minority saying Trump doesn't. It's
saying Trump does have the authority to impose these tariffs.
And then the political conversation outside of it, You've got
a lot of Republican leaning out outlets like National Review

(36:37):
and all these others who are like going nuts over
tariffs and don't like them, and there are a lot
of liberals who are sort of softly quietly like, probably
when Trump leaves, we're not going to get rid of
all these tariffs. It's a real topsy turvy thing about
what's actually conservative and what isn't. When we return, a

(36:58):
quick little rant about the word evidence and how journalists
get it wrong all the time. Next on the John
Growardy Show, there's the whole story raging over President Trump
firing Lisa Cook from the Board of Governors for the
Federal Reserve. President Trump fired her for cause, which he's

(37:21):
statutorily allowed to do. He's allowed to fire people from
the Federal Reserve for cause because she engaged in mortgage fraud,
allegedly that she claimed that two Holmes were both going
to be her primary residence. This allowed her to get
a favorable interest rate on the mortgages for both those loans,
which meant that she probably defrauded a bank out of

(37:42):
one of the two banks, out of tens of thousands
of dollars. Hakeem Jeffries, the republic the Democrat leader in
the House, said there's no evidence that she committed mortgage
fraud and I just want to say this. Journalists say
that a lot no evidence, and what they mean is
not enough evidence that we think it's. Evidence just means

(38:02):
anything that moves the ball down the field to make
a proposition more likely than not. Journalists get that wrong
all the time, so I don't want you to get
that wrong. That'll do it. John Girardi Show, See you
next time on Power Talk.