The details are secret, but the outcome isn’t: The Commerce Department has handed Trump an easy justification to impose auto tariffs. This isn’t surprising; it only confirms that, for Trump, “national security” translates to a blank check for whatever trade policy he wants to impose.
Section 232 of the Trade Expansion Act of 1967 allows for tariffs based on national security. But with all the discretion it gives to the president, it has simply become a mechanism for the White House to play god on trade, picking economic winners and losers. And that power, combined with Trump’s ignorance of basic economic principles, is doing real damage.
Take, for example, those auto tariffs that Trump could now make a reality. Estimates show that they could add $4,400 to the average cost of a new vehicle in the U.S. That’s going to have serious repercussions for the economy and mean fewer jobs like those at GM’s plant in Lordstown, Ohio, that Trump seemed to care so much about over the weekend.
But we don’t need to look at hypotheticals to see the damage wrought by Section 232 tariffs. Indeed, the first round, imposed on steel and aluminum, are already crippling U.S. manufactures due to sky-high prices on the materials used in consumer products. Those costs add up to hundreds of millions of dollars. Indeed, data from August 2018 shows that steel and aluminum tariffs cost U.S. companies an additional $600 million in one month.
That’s bad news for the economy, bad news for consumers, and bad news for manufacturers. In short, those tariffs are not at all in the interest of the country and have nothing to do with national security, never mind whatever arguments the Commerce Department is able to drum up to support Trump.
Nevertheless, with his new report in hand, Trump has all of the authority he needs to further damage to the country — unless, of course, Congress decides to do something about it.
