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Tariffs are Breaks in the Line


Bastiat’s concept of a negative railroad involved unneccessary breaks in the line that would provide employment to porters and baggage handlers. The same principle applies to duties and tariffs imposed at borders:

Just think how many jobs Congress could create by encouraging states to erect their own tariff walls? High-taxing and heavily regulating states would then be able to protect their workers from states with lower taxes and less-burdensome regulations. California wineries would never again lose market share to rivals in Oregon and Washington state. Michigan autoworkers would never again be displaced from their jobs by workers in Tennessee and South Carolina.

Given Krugman’s assumption that restricting consumers’ freedom to make cross-border purchases increases the total number of jobs in economies suffering unemployment, why let all those borders between Maine and California go to waste? Turn those borders, too, into barriers to trade and watch American employment skyrocket!

Even if the cargo is not physically transferred, the effect is the same. Productive potential is wasted, consumers can afford less, and the world is made poorer by every border crossing.