Trump's Rants About Tariffs Go Beyond Nonsense

The following is a small part of a post by economist Paul Krugman:

One safe prediction, however, is that over the next few days we’ll see many news analyses purporting to explain the thinking behind this radical change in U.S. policy.

Such analyses will be a waste of time, because there’s nothing to explain. I’m not saying that the Trump team’s thinking is unsound. I don’t see any thinking at all.

I don’t know how many people realize that the administration’s case for tariffs is completely incoherent, that it has not one but two major internal contradictions.

Here’s the story: Trumpers are claiming that tariffs

1. Won’t increase prices, because foreign producers will absorb the cost

2. Will cause a large shift in U.S. demand away from imports to domestic production

3. Will raise huge amounts of revenue

If you think about it for a minute, you realize that (1) is inconsistent with (2): If prices of imports don’t rise, why would consumers switch to domestically produced goods? At the same time, (2) is inconsistent with (3): If imports drop a lot, tariffs won’t raise a lot of money, because there won’t be much to tax.

So the public story about tariffs doesn’t make any sense. And Trump’s rants about tariffs go beyond nonsense.