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Prior to World War II, Japan was an imperialist nation bent on expansion to become a world power. However, it wasn’t just nationalistic pride that caused them to be this way. It was a small island country completely dependent on foreign nations for critical resources such as oil. So, it shouldn’t have been too much of a surprise they considered the U.S. oil embargo an act of war, after which they launched their ill-advised attack on Pearl Harbor.
The United States, on the other hand, was an industrial powerhouse, a manufacturing sleeping giant, blessed with natural resources and minimal dependency on foreign nations. During World War II, the U.S. went on to produce 300,000 aircraft, 124,000 ships, 100,000 tanks, and 2.4 million trucks. It not only supplied the American military, it absolutely rescued Britain, Soviet Union, and other allies from certain defeat.
Compare that capacity to today. The U.S. is now mainly an information & service based economy, with manufacturing capacity dwindling every year. And despite having nearly all the energy, lumber, steel, and other resources we need, politicians have hamstrung our ability to utilize them, while incentizing American companies to fill their needs overseas. That’s one of the reasons American politicians can’t stop themselves from meddling in other nations’ wars and internal politics. We’ve become utterly dependent on foreign governments for virtually every critical need. If we weren’t so dependent, then tariffs wouldn’t even cause a blip to our way of life.
Trump is trying to change that whole equation. He’s trying to bring manufacturing capacity back, fully develop our internal resources, and completely change the punishment/incentive formula for the business world. It’s very possible he’s going about it the wrong way, and it’s very possible the costs will far outweigh the benefits, but that summarizes his goals.
To be sure, from an economics standpoint, the best tariff rate is 0 percent for all sides. All countries have their own comparitive advantages, where costs are lowest and production capacity is maximized. I’d love to make all the sugarcane & moloasses for rum here in Wisconsin, but it makes a tad more sense for Caribbean island countries to take care of it. And of course, there are plenty of products that require intense manual labor in jobs Americans simply will not work, certainly not for $3/hour like in third world countries trying to climb out of poverty. If all world governments would take the shackles off the business & trading environments, resources and capacity would be maximized for everyone. However, since foreign countries have put up crushing barriers, Trump sees no other choice then to finally strike back.
Blog Link: https://educationdojo.com/study-break/2025/04/04-06-education-dojo-daily/#random_thoughts
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“If all world governments would take the shackles off the business & trading environments, resources and capacity would be maximized for everyone.” — Hear Hear!