Washington's commentariat has succumbed once again to its favorite narcotic: the illusion of technocratic equilibrium. The financial press now purrs that the trade war between the United States and the People's Republic of China has reached a tranquil plateau. We are asked to breathe a sigh of relief because the tariff barrages have settled into a low, rumbling hum rather than a daily siren. Do not buy the sedative. A truce between two central planning apparatuses is not free trade; it is merely the cartelization of state violence against the consumer.
What the foreign policy clerisy calls stability is nothing more than the institutionalization of economic self-harm. Neither the Biden administration nor its counterparts in Beijing have suddenly seen the light of David Ricardo [1]. Instead, they have codified a permanent regime of industrial subsidies, targeted export controls, and retaliatory levies that act as a silent, regressive excise on American households. The Trumpian tariffs—once correctly diagnosed by mainstream economists as an act of brazen economic vandalism—have been sanctified by his successors, who merely added a veneer of progressive rhetoric about friend-shoring and labor standards to justify the exact same brand of sixteenth-century bullion-hoarding mercantilism. [Footnote 1: To the inevitable scribblers at the Economic Policy Institute who will screech that tariffs protect domestic wages: I invite you, for the seventeenth time, to demonstrate how raising the price of capital inputs benefits the laborer whose real purchasing power you have deliberately eviscerated.]
The pretense that this conflict has subsided ignores the fundamental pathology of state intervention: once a government distorts price signals, it must continually intervene to manage the catastrophic consequences of its initial meddling. Washington prints hundreds of billions to cajole semiconductor manufacturers into building uncompetitive fabrication plants in the desert, while Beijing doubles down on subsidizing excess industrial capacity to keep state-owned zombies on life support. This is not competition; it is a competitive waste of scarce capital directed by bureaucrats whose sole qualification is their proximity to political patronage.
It is particularly instructive to watch the political theater of the moment—whether it is party functionaries squabbling over Michigan Senate seats or pontificating on television—while both factions quietly embrace the disastrous tenets of autarky. The modern political class has decided that the ordinary citizen cannot be trusted with the liberty to purchase a solar panel, an electric vehicle, or a piece of steel without a federal customs agent skimming a toll off the top. They dress this larceny in the solemn robes of national security, a phrase that has expanded so rapidly in recent years that it now apparently encompasses washing machines and cheap consumer electronics.
Frédéric Bastiat dismantled this sophistry nearly two centuries ago, yet our rulers remain determined to learn nothing. When goods are blocked from crossing borders by fiat, capital is violently diverted from its most productive uses into politically connected boondoggles. The sense of calm currently being peddled by diplomats is the calm of an engine seizing up: quiet, perhaps, but catastrophic for anyone relying on the machinery to function. The trade war has not ended; it has simply metastasized into an entrenched administrative state apparatus designed to pick your pocket in the name of geopolitical theater.
The only rational, moral economic policy is unilateral free trade. A free people does not ask permission from its sovereign to exchange private property with a willing seller in Guangzhou, Munich, or anywhere else on this earth. Until Washington abandons its childish obsession with balance-of-trade sheet acrobatics and lets the spontaneous order of the market operate unimpeded, this so-called peace remains nothing more than a slow-motion siege against the prosperity of the American consumer.
— Cornelius Bragg