Emperor Penguins. NOAA Corps Collection Photographer: Giuseppe Zibordi Credit: Michael Van Woert, NOAA NESDIS.
Way back on his April 2 “Liberation Day,” (it feels like a long time ago), Donald Trump released a set of “reciprocal” tariffs. These tariffs bore no obvious relationship to the tariffs or other trade barriers that other countries impose on our exports to them. While many of us were trying to figure out how Trump came up with his numbers — which included large taxes on imports from many major trading partners and longstanding allies — someone noted a 10 percent tariff on imports from the Heard and McDonald Islands.
The key problem with this tariff is that the islands are uninhabited except by penguins and other wildlife. The fact that Trump could come up with a schedule of tariffs that ostensibly took weeks of preparation and still include a set of uninhabited islands showed the ineptitude of his economic team in dealing with the issue that is most important to Trump.
But even worse than this blunder was the fact that they couldn’t acknowledge the obvious mistake. Several days later, when the tariff on the penguins’ exports had become an international joke, Commerce Secretary Howard Lutnick insisted that the tariff was put in place deliberately. Lutnick claimed the 10 percent tariff was needed to prevent transshipment of goods to avoid tariffs placed on other countries’ exports.
This claim was obviously absurd on its face. There are thousands of uninhabited islands in the world; how did Trump decide that these uninhabited islands uniquely posed a risk for avoiding tariffs through transshipment?
More importantly, there are still enormous differences in tariffs across countries and even between goods from the same countries. If we really think our customs personnel are so inept that they can’t recognize that goods were not really manufactured on an uninhabited island, how will they recognize the Chinese goods (145 percent tax) that are being shipped through Vietnam (10 percent tax) in a box that says “Made in Vietnam.”
The problem is made even worse by the fact that some items, like smartphones and computers, are currently exempt from Trump’s 145 percent import tax. Can customs employees that can’t recognize that uninhabited islands don’t manufacture goods for export be counted on to correctly make these distinctions?
Lutnick’s claim is obviously absurd on its face. But it is a great example of the Trump administration’s determination to live in a fantasy world rather than admit mistakes and live in the same reality as the rest of us.
We got another example that is even more absurd last week when Attorney General Pam Bondi claimed that Trump’s fentanyl seizures in his first 100 days in office saved between 119 million and 258 million American lives. Her claim means that, without Trump’s seizures, between one-third and three quarters of the country would have died from fentanyl overdoses this year.
It is scary that we have an attorney general that is apparently so out of touch with reality that she thinks these numbers are anywhere close to making sense. There were fewer than 100,000 deaths from fentanyl in the twelve months before Trump took office and the number had been declining.
This means to even get in the ballpark, Bondi would need to divide her figures by more than 2,000, and even that would almost certainly still be a massive overstatement. But don’t hold your breath waiting for a correction from the Attorney General.
Getting back to economics, Trump and his team are pushing the line that the economy was a disaster before he took office and whatever troubles we face now are the result of a necessary cleanup operation.
It is important not to let Trump’s gaslighting work. Trump got handed the best economy of any president in the last half century. Unemployment was low, inflation was relatively low and falling. Productivity growth was strong and real wages were rising, with the largest gains for those at the bottom end of the wage distribution. We also were seeing an unprecedented boom in factory construction, bringing manufacturing back to America.
To be clear, plenty of people were still suffering. It’s fair to say that the bottom 20 percent of the population, 65 million people, were struggling to get by, or not getting by. But that has always been true in our economy with its shoddy safety net and every economic analyst knows this.
Many on the right were anxious to highlight the hardships and media outlets like the New York Times, Washington Post, and CNN were happy to help them. (Every time I posted on the good data from the Biden economy, I got barraged on X with people saying they worked three jobs and still couldn’t pay the rent. All the suffering people remarkably disappeared after the election.)
Anyhow, we can’t let Trump get away with pushing nonsense about the economy he inherited. We know he and his advisers are all shameless liars. But the truth should still be worth something even in Donald Trump’s America.
This first appeared on Dean Baker’s Beat the Press blog.
