In politics, the word “war” gets thrown around a lot, usually to make people look tough and decisive. We have had “wars” on crime, poverty, and drugs. (Spoiler alert: none of them went very well.) Today, there is talk of a “trade war” with countries that buy and sell goods (products like cars, computers, clothing) and services (things like design or financial advising) with the United States.
This began after President Donald Trump imposed tariffs on steel and aluminum imports from European countries, Canada, and others. He also recently imposed tariffs on imports of flat-screen TVs, medical devices, aircraft parts, and other technological goods from China.
In a trade war, a country restricts imports of products and services through tariffs. A tariff is a tax on imports, which reduces how many items come into the country. The country whose goods are subject to restrictions then usually retaliates, starting a back-and-forth “war” of increasing limits to trade. This is what happened earlier this year: other countries slapped tariffs on select U.S. imports like pork, soy products, and bourbon.
While some of those items seem trivial, think about your own life. Most of the clothes and technology you use are imported. So is the aluminum in the car you drive or the steel in your house or office. Tariffs make all of these things more expensive. If you work for a company that exports affected products, tariffs will also impact your job. But there’s a much more important concern here.
Although most Democrats and Republicans supported free trade after World War 2, in the last few years, members of both parties began to question its benefits to the U.S. It’s a very technical subject, and not everyone agrees on what’s best for jobs and consumers. What we know is that statements like President Trump’s tweet in March that “trade wars are good, and easy to win” grossly simplify the risks of this approach.
In a trade war, the main risk goes beyond iPhone and car prices going up, or American farmers going broke because they can no longer sell their products abroad. A trade war that escalates too far can tip over into a shooting war.
So whatever your view on trade, it’s an issue that’s not going to be solved by tough talk. Any candidate that promises it’ll be easy to win a trade war is misleading American workers and consumers. U.S. leaders crafted the global trading system after World War 2. World trade needs to be reformed, not dismantled. This can only be accomplished by working with, not against, other countries — especially longtime allies in countries that share many of the U.S.’s concerns.