Tariffs Only ‘Work’ If They Raise Prices

Matthew Yglesias: “There are lots of different ways that tariffs could play out. Some of those ways could lead to large increases in consumer prices and some have smaller or near-zero price effects. But to the extent that tariffs successfully protect high-wage American jobs or drive new investment in creating such jobs, the mechanism through which they succeed is higher prices.”

“If the prices don’t go up, then the things that Trump is touting as the benefits of tariffs also don’t happen.”