Monday, March 5, 2018

Tariffs and the politics of the unknown

Back to an old theme today.  Uncharted waters.

As I scan the questions in the National Election Studies survey, the 2016 survey included nothing about tariffs directly.  The closest the survey comes is a set of questions on trade agreements, and how good or bad it is to increase trade with other countries.  So, for example, 45.6% claimed to think it was good to increase trade with other countries, 20.1% claimed to think it was bad, and the remaining 34.3% did not claim to stake a position.  Notice my wording.  "Claimed."  Trade policy is a classic example of an issue about which voters have what Phil Converse called, "non-attitudes."  Most survey respondents will answer questions as though they have firm opinions because most people don't want to admit how little they think about politics and how little they know, but on issues like trade policy, most people just don't know very much.

So, for all of my mercantilism-bashing, trade policy is kind of obscure, and if you don't actually understand economics, you won't really have an opinion.  The answers described above made it look like the country was pro-trade, but I can twist the wording around and get other answers.  I'm sneaky that way.

Americans aren't intrinsically pro-trade, then, sad as that state of affairs is for the state of economics education in the country.  What happens, then, if Trump really gets his tariff-based trade war?

We haven't had one in a while.

In terms of economics, we know what happens.  They're bad.  That has direct implications for public opinion because a bad economy hurts the president and the president's party, but there are other implications that aren't necessarily clear.  The GOP gets potentially divided.  Since Trump locked up the GOP nomination, the party has rallied behind him on basically everything, even though most of the party understands how fucking stupid he is, and how particularly stupid trade wars are.  So...

Case 1)  A united GOP behind Trump.  Republicans at the electoral level take unified signals from GOP elites that they are now pro-tariff, anti-trade, and this becomes part of the party orthodoxy.  What gets more complicated is that Bernie is just as fucking stupid as Trump on trade.  More on this shortly.

Case 2)  A divided GOP.  In that case, Trump probably doesn't get his trade war, and he moves on to some other impulse.  It is possible that the basic, capitalist impulses of the Republican Party could put an end to this nonsense.  Then again, they have indulged every other Trump impulse, so...

Case 1 is obviously the more interesting possibility, and it plays out in one of two ways.  It could mess with the party cleavages because there are plenty of people in the Democratic Party who oppose trade.  Unlike Trump, they aren't mercantilists.  Sanders is a self-identified socialist, not a mercantilist.  There are many forms of idiocy.  There could be a unified GOP with a divided Democratic Party.  Result?  The US just becomes a protectionist mess of a country.

However, if Trump gets the entire GOP to become protectionist, that could push the Democratic Party to become the free trade party by default, and we have a new party cleavage, with trade becoming a new component of liberalism-conservatism.  Free trade becomes a tenet of liberalism and protectionism becomes a component of conservatism.

The definitions of liberalism and conservatism change over time, and they do so as opinion leaders change them by constructing coalitions.  Good book:  Political Parties and Political Ideologies in America, by Hans Noel.  Yes, he was a co-author of The Party Decides, but I'm talking about his good book.

My point is that there are a lot of possibilities for what happens to parties and coalitions if Trump really does push through this tariff bullshit.  Economically... no.  It'll be bad because tariffs and trade wars are stupid.  Politically, though, lots of stuff could happen.  We don't know.

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