Monday, May 13, 2019

Literary Corner: Trade Wars

The Battle of Nájera, 1367, illumination likely by Loiset Lyédet from a Flemish manuscript of Froissart's Chronicles, 1470s, in the Bibliothèque Nationale Française, via Wikimedia Commons.

Villanelle of the Trade War
Fasten your seat belts and brace for the spin
Nobody needs to get hurt in the fray
Trade wars are good and easy to win
We're raising the tariffs on cotton and tin
They're raising the tariffs on copper and hay
Fasten your seat belts and brace for the spin
The president waits for the cash to roll in
He's feeling annoyed and someone must pay
Trade wars are good and easy to win
The public looks ruefully on with a grin
Somebody's tanking the market today
Fasten your seat belts and brace for the spin
The bartender's pouring out fingers of gin
The brokers are shoving you out of the way
Trade wars are good and easy to win
The president's kicking his foes in the shin
The press watches rapt at the awesome display
Fasten your seat belts and brace for the spin
Trade wars are good and easy to win

I've been wanting to use this Trumpian refrain for months, but I was fixated on making a ballade, which I now see was the wrong idea, and nothing happened until this morning, after the Chinese finally found a tit for Trump's latest tat (one of their problems in prosecuting the trade war is that the US imports so much more from China than China imports from US that there isn't that much left they can put a tariff on, while our tariffs on them have no effect because Americans can't stop buying Chinese products).

What I really wanted was a form with two refrains, and one that would accommodate the Dr. Seuss bumptiousness of Trump's dactylic tetrameter line, and when I looked up the rhyme scheme for the villanelle, it fell into place like magic. I've never written a villanelle before (the most famous one in English is Dylan Thomas, "Do Not Go Gentle"), but I see why people like it: the demands of the form are so rigorous that any meaning you manage to pack into it seems like a miracle, and the repetitions somehow heighten the movement instead of slowing it down.

All the people making fun of Trump for not knowing who pays an import tax (the importer, who passes the cost on to the consumer, not the exporting country, as Trump seems to believe) are right, and it's astonishing, when you come to think of it, given how much attention Trump has paid to import businesses himself, he and Ivanka, the whisky, the ties, the cologne, the frocks—surely they're aware that they've been paying tariffs themselves! Unless, of course, these businesses have always been scams used to mask some kind of laundered money. Hmm, what made me think of that?

But they also miss the point that Kudlow is right, in theory, when he says that "both sides have to pay": Americans have to pay the tax for the stuff they import from China, and China has to live with the loss of market when Chinese products become too expensive for Americans to buy (just as America loses when its soybeans and airplanes become too expensive in China), or would if that were to happen, which it doesn't, because we're so addicted to our Chinese stuff. In real life, Kudlow is wrong on that account, and what Trump policy does is to just widen the trade deficit. There has never been a more self-defeating policy.

What people need to understand, and Trump plainly doesn't, and journalists don't seem to regard as worth discussing (partly because it hasn't been relevant for a century, until Trump pulled his confusion over the subject out of his brainfog), is that import taxes historically have two possible functions, to raise revenue and to protect local production by making imports too expensive, and they are inevitably in conflict with each other; if you manage to stop people from buying foreign products there won't be any revenue at all, and if you don't there won't be any protective effect while the revenue you raise will always be a trivial amount compared to the trillions Trump's taken from the government for himself and his allies in the tax bill, and the whole concept is a century out of date, in any case, since American industry stopped needing protection in the 1890s and American government stopped needing tariff revenue after the 16th Amendment legalized income tax. Tariffs don't really do anything at all but drag our overripe economy. While Trump rubs his hands in glee at all the money America is making from the consumers who pay for it, which isn't in fact very much at all, American export industries are in serious trouble and he's thus harming the very people, farmers and factory workers, he imagines he's helping.

For an account of the situation that sticks to the relevant issues and doesn't add to the confusion, see Dr. Krugman.

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