Let's Start With What a Tariff Actually Is
A tariff is a tax. That's it. That's the whole thing. When the federal government imposes a 25 percent tariff on steel from Canada, it is collecting 25 percent of the import value from the American company that bought the steel. Not from Canada. Not from the Canadian steelmaker. From the American importer, who then passes that cost down the chain until it lands, inevitably, on the consumer paying for whatever the steel went into.
This is not a controversial claim among economists. It's not a left-right issue. It's arithmetic. The empirical evidence from Trump's first-term tariffs — studied by researchers across the political spectrum — found that the costs were borne almost entirely by American households and businesses, not by foreign exporters. A 2019 analysis by economists at the Federal Reserve Bank of New York found that the China tariffs cost American consumers and importing businesses roughly $3 billion per month. That money didn't come from Beijing. It came from American wallets.
Veronique de Rugy has been making this point with admirable persistence, and she's right. The frustrating thing isn't that tariff advocates disagree with her — it's that many of them don't even engage the argument. They change the subject to manufacturing jobs, national security, leverage in trade negotiations — anything except the actual incidence question of who bears the cost. Because the answer to that question undermines the political case.
The Regressive Problem That Populists Won't Touch
Here's the thing that bothers me most about the current tariff enthusiasm, and I want to be direct about it because I think conservatives who support working-class Americans should care.
Tariffs are regressive. That means they hit low-income households proportionally harder than high-income ones. A family spending 70 percent of their income on food, clothing, and household goods — largely imported categories — pays a much higher share of their income in tariff-driven price increases than a family that saves and invests half of what it makes. The wealthy can absorb a 15 percent increase in appliance prices. The family that financed a washer and dryer on a payment plan cannot.
I sat across the table from a small contractor last fall — guy who runs a four-person outfit building decks and doing renovation work in the suburbs of Dallas. He laid out his numbers for me with the kind of clarity that people who actually work with margins have. His lumber costs were up 34 percent. His steel fastener costs were up. His aluminum trim was up. He couldn't raise his prices enough to cover it without losing bids to competitors who were somehow absorbing it. He was squeezed from every direction, and the source of the pressure was trade policy that was supposed to be helping American workers.
That contractor voted for Trump twice and will probably vote for him again. He supports the general direction of the administration. But the tariffs? They're eating him alive. And nobody in Washington is being honest with him about why.
The Leverage Argument Deserves Scrutiny
The strongest case for tariffs isn't economic — it's strategic. The argument runs like this: tariffs are a negotiating tool. You impose them to create pressure, then trade them away for concessions on market access, intellectual property protection, currency manipulation. The short-term pain is the price of long-term gain.
There's something to this. Trade negotiations require leverage, and the credible threat of tariffs is a form of leverage. The USMCA renegotiation produced some real improvements over NAFTA on labor and intellectual property. Credit where it's due.
But the leverage argument requires that the tariffs actually be temporary — that the administration has a clear theory of success, defined concessions it's seeking, and the discipline to remove tariffs when those concessions are obtained. What we're seeing instead looks like tariffs as a permanent feature of trade policy, imposed against allies and adversaries alike, with shifting justifications. Canada is not an economic adversary. Mexico is not. The European Union is not. Treating them identically to China in trade policy isn't strategic leverage — it's a confusion of categories that undermines the actual strategic case.
When your leverage tool becomes your default setting, it stops being leverage.
Conservative Economics Has to Mean Something
This is, ultimately, an argument about what conservatism is and what it owes the people who vote for it.
For decades, the conservative economic framework rested on clear principles: free markets allocate resources more efficiently than governments. Trade creates wealth by allowing specialization and comparative advantage. Taxes and regulations impose costs that ultimately fall on workers and consumers. Price controls, subsidies, and protectionism produce distortions that have to be paid for somewhere.
These weren't just talking points. They were right. The evidence base for them is substantial. The prosperity of the postwar decades was built in significant part on expanding trade. Countries that opened their economies grew faster than countries that closed them. The case was solid.
Tariff populism doesn't just deviate from these principles — it runs directly against them while claiming the mantle of helping ordinary Americans. The ordinary Americans being helped are a narrow, identifiable group in specific protected industries. The ordinary Americans bearing the cost are everyone who buys anything the protected industries produce or input into.
A conservative movement that can't tell its voters the truth about who pays for tariffs has surrendered something important. Not electoral position. Credibility. The willingness to deliver an honest accounting even when the politics point the other direction is what distinguishes a governing philosophy from a campaign slogan.
The tariffs may stay. The political coalition that supports them may hold. But someone has to be willing to say clearly: this is a tax, you are paying it, and the people paying it hardest are the ones the administration says it's fighting for. Call it what it is.
