“Much of the chatter in political circles these days concerns what the Republican Party might look like after Donald Trump -- an eventuality that could arrive sooner than the president appreciates if his party loses control of Congress this November.
Others are less concerned with Mr. Trump's political successor than they are with the future of free-market conservatism. An earlier generation of Democrats and Republicans found agreement on basic economic principles. "Tax rates are too high today and tax revenues are too low, and the soundest way to raise the revenues in the long run is to cut the rates now," President John F. Kennedy said in 1962. How many prominent Democrats still talk like that?
At least since the Reagan era, the GOP has been the main vehicle for popularizing and advancing economic freedom. And though there are similarities between the Trump and Reagan presidencies -- both men cut taxes, reduced regulations and connected with traditionally Democratic voters -- philosophical comparisons between the two can quickly become strained.
At Mr. Trump's direction, the federal government has taken an equity stake in Intel, becoming the tech company's largest shareholder. It has promoted price controls on pharmaceuticals and credit-card interest rates. It has permitted Nvidia to ship advanced semiconductor chips to other countries, but on the condition that Treasury receives a 25% cut of the revenues. In return for allowing Nippon Steel to acquire U.S. Steel, the government demanded veto power over plant closures and layoffs. And it has used tariffs broadly to bludgeon America's friends and foes alike into economic submission.
This is industrial policy, the antithesis of free-market economics. None of it is reminiscent of Reagan, and all of it has been abetted by Republicans in Congress who spent years lecturing the Biden and Obama administrations about the pitfalls of government meddling in the private sector. As the Journal editorialized recently, our sad situation today is that "both major political parties lack notable champions for free-market principles."
On March 9, we'll mark the 250th anniversary of Adam Smith's "An Inquiry Into the Nature and Causes of the Wealth of Nations," published a few months before the Declaration of Independence. The book is considered the foundational text of modern classical economics, and it wouldn't hurt Republican officials to crack open a copy.
Smith's "Wealth of Nations," which spawned an entire school of economics, was written to challenge the prevailing mercantilist system in Britain. The mercantilists advocated on behalf of merchants and favored economic protectionism. They equated a nation's wealth with the amount of gold and silver it possessed and perceived international trade as zero-sum, meaning one nation's gain was another's loss. It was essential for a country to export more than it imported. It's important to "sell more to strangers yearly than wee consume of theirs in value," wrote the economist Thomas Mun, a prominent 17th-century mercantilist. And nations must produce domestically "things which now we fetch from strangers to our great impoverishing." Sound familiar?
Smith set out to refute these ideas. He argued that a nation's wealth derived not from the amount of gold it possessed but rather from its production and flow of goods and services. Government intervention on behalf of the merchant class led to cronyism, and trade protectionism hurt consumers by limiting their purchase options and increasing prices. Central planning was inefficient. Economic growth resulted when consumers, producers and investors sought their own self-interests through voluntary exchanges.
Whether or not he realizes it, Mr. Trump is animated by a mercantilist conception of the world. But thanks to Smith, today we judge the performance of an economic system based on how efficiently it allocates resources to satisfy consumers, not merchants. Better to focus on creating wealth, not taking existing wealth from others. Republican officials spend a lot of time these days directing epithets like "Marxist" and "socialist" at their political opponents. But where is their criticism of Mr. Trump's statist tendencies? And what is their competing approach?
The Supreme Court could strike down some of Mr. Trump's "emergency" tariffs as early as this week, but the president has vowed to find other ways to pursue his protectionist agenda regardless of the decision. We know that the Democrats' disapproval of trade barriers is situational -- President Biden left most of Mr. Trump's first-term tariffs in place -- but if Republicans in Congress could muster the courage to speak out in favor of free trade and its benefits, they might do themselves some good in November. We know Adam Smith would approve.” [1]
Is MAGA right to criticize free international trade?
The answer to the question of whether the MAGA (Make America Great Again) movement's criticism of free trade is "right" depends on what economic and political priorities you consider to be most important. Economists and political experts have different opinions on this issue:
MAJOR ARGUMENTS (Basis of Criticism)
Job Loss: Critics argue that free trade has led to the relocation of production to countries with lower labor costs (outsourcing), which has led to the loss of millions of manufacturing jobs in the United States.
Unfair Competition: It is argued that other countries (especially China) do not follow the rules, use state subsidies and dumping, making trade "unfair" rather than "free".
National Security: Dependence on foreign supply chains (e.g., semiconductors or medical devices) is seen as a strategic risk. Tariffs are used as a tool to encourage domestic production.
Trade deficit: MAGA supporters see a large trade deficit as a sign of economic weakness and seek to reduce it through protectionist measures.
ECONOMIC CRITICISM OF MAGA POLICY (Implications)
Most mainstream economists emphasize the negative consequences of MAGA tariffs for consumers:
Higher prices: Studies show that about 96% of the cost of tariffs is borne by US businesses and consumers themselves, which acts as an additional tax on consumption.
Slower GDP growth: It is estimated that tariffs can reduce US GDP by about 0.5 percent due to higher prices for manufacturing inputs and reduced investment.
Retaliatory actions: Other countries often respond with tariffs of their own, which hurts US exporters (especially the agricultural sector).
Automation, not jobs: Even if manufacturing returns to the US, modern factories often employ robots rather than people, so there is no noticeable mass return of jobs in industry.
SUMMARY
The criticism of MAGA is justified from a social and political perspective (to protect specific communities and industries), but from an economic perspective it is controversial because it causes inflation and disrupts global supply chains. But we don’t see that inflation, which is why most economists are wrong.
For more information on the impact of tariffs, see the Tax Foundation analysis or J.P. Morgan research.
1. Upward Mobility: GOP Doesn't Know Smith From Adam. Riley, Jason L. Wall Street Journal, Eastern edition; New York, N.Y.. 18 Feb 2026: A17.
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