Did you hear the joke about how a “Tea Party” candidate in Western New York supports tax increases, tariffs and refuses to reform the federal budget? Karl Marx, a philosophical ally of Republican turned Democrat turned Tea Party chameleon Jack Davis would have mused, “History repeats itself, first as tragedy, second as farce.”
In order to close our ever widening budget gap and create jobs, Jack Davis, who is running in the NY-26 special election as a “Tea Party” candidate, proposes to restore a trade “balance” by slapping tariffs on all import to export imbalances. Not all trade imbalances are equal, so discretion would be arbitrarily left up to someone, most likely a “trade czar”, who could raise the rate of the tariff anywhere from 5 to 20 percent, depending on what is needed to reduce the trade discrepancy.
This misguided policy prescription would increase costs on all Americans in the form of higher prices on products that are favored by American consumers. This “taxation without representation”, would also have the net effect of destroying jobs in other industries that rely on access to cheap goods to make profits and could ignite a trade war whose pernicious effects on the economy are incalculable. There would no real increase in jobs like Davis proclaims.
It is always convenient for politicians to perpetuate trade myths, while neglecting the true source of our faltering economy, which is the failure of politicians who enact flawed Keynesian “stimulus” policies, stringent regulations and amass tremendous deficits that make investment in our economy less attractive. Jack Davis suffers from what Hayek called the “fatal conceit”, the idea that politicians can create an economy based on their imaginative whims and deliberate designs.
Davis also disregards the tsunami of entitlement spending that is set to wash up on our shores and destroy the American dream. Shockingly, he believes that the problems facing our unsustainable entitlement structure can be solved through (wait for it!) imposing tariffs and eliminating free trade deals. This he believes, will lead to further job creation and thus increase revenues to the government.
This shows an inherent lack of understanding in basic economics. If tariffs could revitalize an economy and reduce deficits, then why don’t all nations practice full protectionism? Because history and the laws of economics say otherwise, as the Smoot-Hawley Tariff of 1930 facilitated a Great Depression, instead of ending a recession.
Jack Davis is a “Tea Party” fraud, who ran as a Democrat in 2004, 2006, and 2008. He endorsed President Obama in 2008, fawned over Nancy Pelosi, and quotes self-avowed socialist Senator Bernie Sanders on a website he conspicuously deleted.
Anyone watching the NY-26 special election should take note of another big government, anti-free market politician who has been reading the “Tea” leaves, in order to score political gain and further a failed liberal agenda.