Trump Tariffs On Steroids!

We’ve got tariffs on steroids. Trump just floated the idea of eliminating the income tax in the United States and replacing it with an all-tariff federal revenue system. The 16th Amendment in 1909 allowed for the federal income tax, and now we’re talking about a tariff system large enough to replace it. No numbers have been provided, which makes this proposal seem like a pie-in-the-sky idea, similar to the fantastical demands in a State of the Union address.

How would this even be possible? When the income tax was first implemented, collections were less than 3% of GDP. Back then, the U.S. didn’t have the military infrastructure or global presence we have today. For tariffs to replace income taxes, we would need tariffs around 500% on imports. While eliminating income taxes sounds appealing, the resulting price increases would be a hard sell to the American people.

Let’s be honest. The notion of moving all manufacturing back to the U.S. is unrealistic. We don’t have the skilled workforce needed, as evidenced by the challenges faced with the Chips Act. New plants are being built, but we lack the trained workers to staff them. We’re not preparing our kids for these jobs. This idea is like putting the cart before the horse, similar to the push for electric vehicles without the necessary infrastructure.

I also want lower taxes. I’ve always supported the idea of a national sales tax rather than an income tax. At least with a sales tax, you see the cost at the point of sale. But a tariff-based system would affect everything. Even goods assembled and manufactured here would face increased costs due to high tariffs on imported components. For example, lumber from Canada used in furniture made in North Carolina would become exorbitantly expensive with a 400-500% tariff.

Reverting to a 19th-century fiscal policy is impractical. Our global role and economic structure are vastly different now. We were not the leading global power back then; the UK was. How can we afford to implement such a system today?

I’m disappointed in Trump and his campaign for floating this idea without providing any detailed plans or numbers. It’s making the rounds in the news and worries me greatly. How is this workable? Frankly, I have more faith in sharks with laser beams attached to their heads.

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