A basic truism is that tariffs benefit the domestic capitalists inside the tariff barriers:
However, British food bosses have warned that cheap exports from the US and China could undermine the country’s major bean processing industry.
If we reduce tariffs then it’s the domestic capitalists producing that tariff-removed item that get it in the neck.
We do not believe this comment for a moment:
“One of the Chancellor’s flagship announcements, removing tariffs from some food and drink products, will have no meaningful impact on consumer prices,” she said.
For if that is true then this following cannot be true:
“But it will undermine British factories and their workers, grappling with much higher costs, producing the same products.”
Schroedinger’s Price Change, one that doesn’t lower prices but does lower prices.
Now we, being liberals, think the economy should be run for the benefit of consumers. That means lifting tariffs - on everything - so that all can gain the most for their spending. The opposite argument is that consumers should be poorer so as to benefit those domestic capitalists by imposing import tariffs. And why would anyone want to do that? Well, other than domestic capitalists?
Unilateral free trade, it’s the only logically consistent position to have. Which is why it worked in 1846 and would work again.
Tim Worstall