President Trump announced last week that he plans to impose 25 percent tariffs on imported steel and 10 percent on imported aluminum. It’s important to note that any policy pronouncement from this president is done within the paradigm of a real estate wheeler-dealer who sees deals of any kind as a zero-sum game. I win, and you lose; there is no such thing as a good trade deal that works as a win-win for both sides. Expressing the opposite view is Paul Krugman, who writes,
Trade isn’t a zero-sum game: it raises the productivity and wealth of the world economy.
And the corollary also applies as well: any action taken to disrupt the free flow of goods between countries is likely to provoke a counter-reaction, the result being a trade war in which every country loses out.