Greg Rosovsky

Now, you could make the case that electric cars are maybe an infant industry, but the auto industry in general, it's not an infant industry. It doesn't need piano lessons. It has been competing on the global stage for years, and now it's getting protections.

Now, you could make the case that electric cars are maybe an infant industry, but the auto industry in general, it's not an infant industry. It doesn't need piano lessons. It has been competing on the global stage for years, and now it's getting protections.

Now, you could make the case that electric cars are maybe an infant industry, but the auto industry in general, it's not an infant industry. It doesn't need piano lessons. It has been competing on the global stage for years, and now it's getting protections.

So if this stuff works in the way the administration seems to want, the best case scenario seems to be that it will still be an expensive, slow process, like multiple years, to build up all of this manufacturing in the United States. In fact, after Trump announced his car tariffs, the stock prices of U.S. automakers fell.

So if this stuff works in the way the administration seems to want, the best case scenario seems to be that it will still be an expensive, slow process, like multiple years, to build up all of this manufacturing in the United States. In fact, after Trump announced his car tariffs, the stock prices of U.S. automakers fell.

So if this stuff works in the way the administration seems to want, the best case scenario seems to be that it will still be an expensive, slow process, like multiple years, to build up all of this manufacturing in the United States. In fact, after Trump announced his car tariffs, the stock prices of U.S. automakers fell.

The market is signaling that this policy will have costs even for American manufacturers.

The market is signaling that this policy will have costs even for American manufacturers.

The market is signaling that this policy will have costs even for American manufacturers.

And we actually have a little bit of data from the last Trump term so we can see empirically what the effect was of similar policies. The Trump administration back then, they put tariffs on a bunch of Chinese goods, including washing machines.

And we actually have a little bit of data from the last Trump term so we can see empirically what the effect was of similar policies. The Trump administration back then, they put tariffs on a bunch of Chinese goods, including washing machines.

And we actually have a little bit of data from the last Trump term so we can see empirically what the effect was of similar policies. The Trump administration back then, they put tariffs on a bunch of Chinese goods, including washing machines.

The view from the Trump world, though, is like, yeah, the transition from our current setup may be painful, but it's going to be worth it.

The view from the Trump world, though, is like, yeah, the transition from our current setup may be painful, but it's going to be worth it.

The view from the Trump world, though, is like, yeah, the transition from our current setup may be painful, but it's going to be worth it.

The Colombian president wouldn't let the military planes land. So, Mark Summerlin says, Trump turned to tariffs.

The Colombian president wouldn't let the military planes land. So, Mark Summerlin says, Trump turned to tariffs.

The Colombian president wouldn't let the military planes land. So, Mark Summerlin says, Trump turned to tariffs.

25% tariffs on Colombian goods. And Trump said they'd go up to 50% a week later.

25% tariffs on Colombian goods. And Trump said they'd go up to 50% a week later.

25% tariffs on Colombian goods. And Trump said they'd go up to 50% a week later.

And yeah, economists have always acknowledged that free trade has trade-offs, that, you know, there will be losers in the face of foreign competition. But for a long time, the dominant voices in the profession made the case that those trade-offs were really worth it. Top lawmakers in both parties in the U.S. really bought into this idea that, you know, free trade would be great for America.

And yeah, economists have always acknowledged that free trade has trade-offs, that, you know, there will be losers in the face of foreign competition. But for a long time, the dominant voices in the profession made the case that those trade-offs were really worth it. Top lawmakers in both parties in the U.S. really bought into this idea that, you know, free trade would be great for America.

And yeah, economists have always acknowledged that free trade has trade-offs, that, you know, there will be losers in the face of foreign competition. But for a long time, the dominant voices in the profession made the case that those trade-offs were really worth it. Top lawmakers in both parties in the U.S. really bought into this idea that, you know, free trade would be great for America.

Because trade is power. And we have used trade policy kind of like this in the past as a geopolitical tool. For example, we thought that capitalism would cure communism. Judy remembers being in China when it was opening its markets in the 1980s.

Because trade is power. And we have used trade policy kind of like this in the past as a geopolitical tool. For example, we thought that capitalism would cure communism. Judy remembers being in China when it was opening its markets in the 1980s.

Because trade is power. And we have used trade policy kind of like this in the past as a geopolitical tool. For example, we thought that capitalism would cure communism. Judy remembers being in China when it was opening its markets in the 1980s.

We had this idea that we could use free trade to make other people see the world in the same way that we do.

We had this idea that we could use free trade to make other people see the world in the same way that we do.

We had this idea that we could use free trade to make other people see the world in the same way that we do.

And that's kind of the view from Trump world. We have all of this power and we should use it. We could go through some pain to get some gain.

And that's kind of the view from Trump world. We have all of this power and we should use it. We could go through some pain to get some gain.

And that's kind of the view from Trump world. We have all of this power and we should use it. We could go through some pain to get some gain.

This episode was produced by Willa Rubin and edited by Meg Kramer. It was fact-checked by Sarah McClure and engineered by James Willits. Alex Goldmark is our executive producer. I'm Greg Rosalski.

This episode was produced by Willa Rubin and edited by Meg Kramer. It was fact-checked by Sarah McClure and engineered by James Willits. Alex Goldmark is our executive producer. I'm Greg Rosalski.

This episode was produced by Willa Rubin and edited by Meg Kramer. It was fact-checked by Sarah McClure and engineered by James Willits. Alex Goldmark is our executive producer. I'm Greg Rosalski.

And they really pushed it for the rest of the world.

And they really pushed it for the rest of the world.

And they really pushed it for the rest of the world.

And being a pro-tariff economist back in the early 2000s, it was kind of lonely.

And being a pro-tariff economist back in the early 2000s, it was kind of lonely.

And being a pro-tariff economist back in the early 2000s, it was kind of lonely.

A battle against half a million free trade economists. That's how unpopular he felt. But he's got kind of the perfect example of why tariffs can work.

A battle against half a million free trade economists. That's how unpopular he felt. But he's got kind of the perfect example of why tariffs can work.

A battle against half a million free trade economists. That's how unpopular he felt. But he's got kind of the perfect example of why tariffs can work.

So Hyundai had to come out with their own design. In 1976, it made the Hyundai Pony. It was the first Korean passenger car. They made around 10,000 of them in a year.

So Hyundai had to come out with their own design. In 1976, it made the Hyundai Pony. It was the first Korean passenger car. They made around 10,000 of them in a year.

So Hyundai had to come out with their own design. In 1976, it made the Hyundai Pony. It was the first Korean passenger car. They made around 10,000 of them in a year.

So yeah, Hyundai was losing money on this new venture. And he's saying the government decided to pitch in, give it some subsidies, and the other parts of Hyundai that were profitable sent over their money. But even that wasn't enough.

So yeah, Hyundai was losing money on this new venture. And he's saying the government decided to pitch in, give it some subsidies, and the other parts of Hyundai that were profitable sent over their money. But even that wasn't enough.

So yeah, Hyundai was losing money on this new venture. And he's saying the government decided to pitch in, give it some subsidies, and the other parts of Hyundai that were profitable sent over their money. But even that wasn't enough.

Because tariffs, they're an old economic tool that many economists have disliked for a very long time. They're basically an import tax paid mostly by consumers.

Because tariffs, they're an old economic tool that many economists have disliked for a very long time. They're basically an import tax paid mostly by consumers.

Because tariffs, they're an old economic tool that many economists have disliked for a very long time. They're basically an import tax paid mostly by consumers.

Yeah, they're making rules that mean South Koreans couldn't buy foreign cars, cars that were maybe better or cheaper or both. Instead, they have to buy these homegrown cars, which was great for Hyundai. But for a Korean person trying to buy a car and paying taxes that are used to, you know, subsidize this company, less great. But as you can maybe guess, this gambit worked.

Yeah, they're making rules that mean South Koreans couldn't buy foreign cars, cars that were maybe better or cheaper or both. Instead, they have to buy these homegrown cars, which was great for Hyundai. But for a Korean person trying to buy a car and paying taxes that are used to, you know, subsidize this company, less great. But as you can maybe guess, this gambit worked.

Yeah, they're making rules that mean South Koreans couldn't buy foreign cars, cars that were maybe better or cheaper or both. Instead, they have to buy these homegrown cars, which was great for Hyundai. But for a Korean person trying to buy a car and paying taxes that are used to, you know, subsidize this company, less great. But as you can maybe guess, this gambit worked.

Hyundai is now one of the biggest car manufacturers on the planet.

Hyundai is now one of the biggest car manufacturers on the planet.

Hyundai is now one of the biggest car manufacturers on the planet.

And then, as we do with children when they grow up, we remove that protection.

And then, as we do with children when they grow up, we remove that protection.

And then, as we do with children when they grow up, we remove that protection.

Right, the idea behind infant industry tariffs is they have to be temporary, or you're just propping up a company that's inefficient and can't be successful on its own. And along the way, wasting a lot of taxpayer money and societal resources that could be put to better use.

Right, the idea behind infant industry tariffs is they have to be temporary, or you're just propping up a company that's inefficient and can't be successful on its own. And along the way, wasting a lot of taxpayer money and societal resources that could be put to better use.

Right, the idea behind infant industry tariffs is they have to be temporary, or you're just propping up a company that's inefficient and can't be successful on its own. And along the way, wasting a lot of taxpayer money and societal resources that could be put to better use.

Alexander Hamilton, RIP, Ha-Joon Chang, and other economists say if the goal is to turn a little baby industry into a strong, productive adult, then really, tariffs aren't enough. You need not only to protect them from outside competition, but you also need to nourish them and help them grow with things like subsidies and piano lessons.

Alexander Hamilton, RIP, Ha-Joon Chang, and other economists say if the goal is to turn a little baby industry into a strong, productive adult, then really, tariffs aren't enough. You need not only to protect them from outside competition, but you also need to nourish them and help them grow with things like subsidies and piano lessons.

Alexander Hamilton, RIP, Ha-Joon Chang, and other economists say if the goal is to turn a little baby industry into a strong, productive adult, then really, tariffs aren't enough. You need not only to protect them from outside competition, but you also need to nourish them and help them grow with things like subsidies and piano lessons.

Now, there's a big debate in economics about the infant industry argument. There are lots of examples of infant industry interventions going bad, like Malaysia trying to build a car or Brazil trying to build a computer industry. These efforts have mostly failed and they wasted a lot of resources in the process.

Now, there's a big debate in economics about the infant industry argument. There are lots of examples of infant industry interventions going bad, like Malaysia trying to build a car or Brazil trying to build a computer industry. These efforts have mostly failed and they wasted a lot of resources in the process.

Now, there's a big debate in economics about the infant industry argument. There are lots of examples of infant industry interventions going bad, like Malaysia trying to build a car or Brazil trying to build a computer industry. These efforts have mostly failed and they wasted a lot of resources in the process.

But economists generally prefer more and freer trade because it means more competition, lower prices, economic growth. A bedrock theory in economics is the theory of comparative advantage, that basically countries can specialize in different things, and through trade, we can all, in the aggregate, get richer.

But economists generally prefer more and freer trade because it means more competition, lower prices, economic growth. A bedrock theory in economics is the theory of comparative advantage, that basically countries can specialize in different things, and through trade, we can all, in the aggregate, get richer.

But economists generally prefer more and freer trade because it means more competition, lower prices, economic growth. A bedrock theory in economics is the theory of comparative advantage, that basically countries can specialize in different things, and through trade, we can all, in the aggregate, get richer.

And tariffs are not just for babies. This kind of protectionism also can make sense for national security interests.

And tariffs are not just for babies. This kind of protectionism also can make sense for national security interests.

And tariffs are not just for babies. This kind of protectionism also can make sense for national security interests.

Another situation where economists think there's a case for tariffs is when trading partners don't play by the rules. Like if a country is manipulating its currency or stealing intellectual property or egregiously exploiting workers, that gives that country an unfair advantage in the global marketplace. And so tariffs are a pretty common tool for competitors to level the playing field.

Another situation where economists think there's a case for tariffs is when trading partners don't play by the rules. Like if a country is manipulating its currency or stealing intellectual property or egregiously exploiting workers, that gives that country an unfair advantage in the global marketplace. And so tariffs are a pretty common tool for competitors to level the playing field.

Another situation where economists think there's a case for tariffs is when trading partners don't play by the rules. Like if a country is manipulating its currency or stealing intellectual property or egregiously exploiting workers, that gives that country an unfair advantage in the global marketplace. And so tariffs are a pretty common tool for competitors to level the playing field.

President Trump is now imposing sweeping tariffs in all sorts of areas and on all sorts of countries. He does talk about things like national security and unfair trade practices, but his approach to tariffs feels like it's about something bigger than that. And it's all part of this particular worldview that seems to be shared within Trump world and also outside of it.

President Trump is now imposing sweeping tariffs in all sorts of areas and on all sorts of countries. He does talk about things like national security and unfair trade practices, but his approach to tariffs feels like it's about something bigger than that. And it's all part of this particular worldview that seems to be shared within Trump world and also outside of it.

President Trump is now imposing sweeping tariffs in all sorts of areas and on all sorts of countries. He does talk about things like national security and unfair trade practices, but his approach to tariffs feels like it's about something bigger than that. And it's all part of this particular worldview that seems to be shared within Trump world and also outside of it.

That the costs of free trade, they were too high. That free trade devastated communities around America.

That the costs of free trade, they were too high. That free trade devastated communities around America.

That the costs of free trade, they were too high. That free trade devastated communities around America.

He says that China got a bunch of manufacturing jobs and the U.S. got cheaper imports, but the people who lost jobs in the United States didn't bounce back. They didn't get new jobs. The China shock created like these mini depressions in towns around the country.

He says that China got a bunch of manufacturing jobs and the U.S. got cheaper imports, but the people who lost jobs in the United States didn't bounce back. They didn't get new jobs. The China shock created like these mini depressions in towns around the country.

He says that China got a bunch of manufacturing jobs and the U.S. got cheaper imports, but the people who lost jobs in the United States didn't bounce back. They didn't get new jobs. The China shock created like these mini depressions in towns around the country.

One of the big goals of free trade policies has been to lower prices, but the trade-off was a huge loss of manufacturing jobs. And manufacturing jobs maybe have something kind of magical about them. For example, a lot of economic research has shown that manufacturing jobs provided ladders to the middle class for people without a college education.

One of the big goals of free trade policies has been to lower prices, but the trade-off was a huge loss of manufacturing jobs. And manufacturing jobs maybe have something kind of magical about them. For example, a lot of economic research has shown that manufacturing jobs provided ladders to the middle class for people without a college education.

One of the big goals of free trade policies has been to lower prices, but the trade-off was a huge loss of manufacturing jobs. And manufacturing jobs maybe have something kind of magical about them. For example, a lot of economic research has shown that manufacturing jobs provided ladders to the middle class for people without a college education.

Judy Shelton is an economist and senior fellow at the Independent Institute, a think tank.

Judy Shelton is an economist and senior fellow at the Independent Institute, a think tank.

Judy Shelton is an economist and senior fellow at the Independent Institute, a think tank.

And I'm Greg Rosovsky. Today on the show, the case for tariffs. What can they be good for?

And I'm Greg Rosovsky. Today on the show, the case for tariffs. What can they be good for?

And I'm Greg Rosovsky. Today on the show, the case for tariffs. What can they be good for?

Judy says tariffs can really work when it comes to achieving the administration's economic goals, which is not only to deter people from buying imports, but also to incentivize them to buy stuff made in America.

Judy says tariffs can really work when it comes to achieving the administration's economic goals, which is not only to deter people from buying imports, but also to incentivize them to buy stuff made in America.

Judy says tariffs can really work when it comes to achieving the administration's economic goals, which is not only to deter people from buying imports, but also to incentivize them to buy stuff made in America.

But of course, if we are taking money out of our pocket for new spending or, you know, collecting less money through taxes, then tariffs won't necessarily improve the budget problem. Like much of the revenue from tariffs in Trump's first term was offset by bailing out farmers who were harmed by trade retaliation. And now the administration is talking about compensating farmers again.

But of course, if we are taking money out of our pocket for new spending or, you know, collecting less money through taxes, then tariffs won't necessarily improve the budget problem. Like much of the revenue from tariffs in Trump's first term was offset by bailing out farmers who were harmed by trade retaliation. And now the administration is talking about compensating farmers again.

But of course, if we are taking money out of our pocket for new spending or, you know, collecting less money through taxes, then tariffs won't necessarily improve the budget problem. Like much of the revenue from tariffs in Trump's first term was offset by bailing out farmers who were harmed by trade retaliation. And now the administration is talking about compensating farmers again.

There are a bunch of different tariffs flying around right now, so we're just going to focus on one. One that President Trump has been talking a lot about in recent weeks, CARS.

There are a bunch of different tariffs flying around right now, so we're just going to focus on one. One that President Trump has been talking a lot about in recent weeks, CARS.

There are a bunch of different tariffs flying around right now, so we're just going to focus on one. One that President Trump has been talking a lot about in recent weeks, CARS.

And we hear how tariffs fit into President Trump's economic worldview from two economists in the orbit of the Trump administration.

And we hear how tariffs fit into President Trump's economic worldview from two economists in the orbit of the Trump administration.

And we hear how tariffs fit into President Trump's economic worldview from two economists in the orbit of the Trump administration.