How Could Liberation Day Happen?

How did Trump manage to screw up Liberation Day so completely?

In last week’s post I made the case that there is some rhyme and reason to Trump’s tariffs, but that Trump the man is the biggest obstacle to his stated policy objectives as he always conducts his governing in a loose non-committal way. I will be the first to admit that I was wrong in that piece. I figured he was far more attached to his “reciprocal” tariffs than he really was. Without having looked up all the detailed product by product tariffs and every single exception (as it may change by the time you are reading this) I still think it is fair to say that Trump’s bark has been much worse than his bite. In what can only be called a humiliating climbdown Trump has effectively reversed Liberation Day. How could this happen?

What is most interesting about the abrupt change in policy in what most commentators, myself included, thought was a load bearing ideological pillar in Trump’s thinking is that it shows the limits of personal rule. I made the case in a post from last autumn that Trump rules more like a king than like a president in the sense that he prefers to exercise power through proclamations and delegating to individuals rather than through laws and delegating to departments or committees.  The Liberation Day fiasco was not unexpected. Most serious economists thought it would be a disaster, most serious politicos expected it to be a political loser, and most serious business people expected it to make doing business a lot harder. Donald’s courtiers did not get the memo, so the policy had to be reversed.

This specific form of bad policy making should be expected to be common in the second Trump administration. Dismantling the government might root out disloyal civil servants and cut down spending on wasteful programs like saving lives abroad, but it also actively and directly limits the capacity the institutions of government has to help foresee potential failures like Liberation Day. Trump’s distrust and distaste for governmental institutions is great on the campaign trail, but terrible when trying to implement policy.

Liberation Day then is a good example of the follies of Trump’s political project, as far as he has an intellectual framework and is not just acting on whims and heuristics about foreign policy. It could only be put forward by a government which acts so haphazardly as to not really know the potential effects of a flagship policy. And no other government would so shamelessly back down from such a prominent and hyped up policy as Liberation Day.

If you liked this post you can read a previous post about tariffs here or the rest of my writings here. It'd mean a lot to me if you recommended the blog to a friend or coworker. Come back next Monday for a new post!

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I've always been interested in politics, economics, and the interplay between. The blog is a place for me to explore different ideas and concepts relating to economics or politics, be that national or international. The goal for the blog is to make you think; to provide new perspectives.

Written by Karl Johansson

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Cover photo by Pixabay from Pexels, edited by Karl Johansson