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@ Samuel Gabriel
2025-06-02 07:42:17
The Selective Economics of Liberal Logic: Tariffs vs. Corporate Taxes
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Economic consistency is often the first casualty in partisan arguments. Nowhere is this more evident than in the contradictory logic used by some progressives when discussing tariffs and corporate taxes.
We’re told that when the U.S. government imposes tariffs on foreign imports, it’s a tax on consumers. Prices go up, and the average American foots the bill. This argument is widely accepted by economists, and it’s generally true: tariffs raise the cost of doing business, and those costs often get passed down the supply chain until they reach the checkout counter.
But shift the conversation to corporate taxes, and suddenly the logic changes. In this case, the narrative flips: tax the corporations, and they’ll simply absorb the cost. The implication is that higher corporate taxes will reduce CEO bonuses, shrink shareholder profits, and somehow improve fairness — all without affecting prices, wages, or jobs.
This is economic fiction.
Tariffs and Corporate Taxes Are Both Business Costs
Both tariffs and corporate taxes function as costs imposed on businesses. Whether it’s a duty on imported goods or a tax on profits, companies have to adjust their balance sheets to accommodate the change. How they do that depends on a variety of market factors — but in both cases, the cost can and often is passed on:
To Consumers: via higher prices.
To Workers: via stagnant wages or fewer jobs.
To Investors: via lower returns or stock values.
So Why the Double Standard?
The inconsistency stems from ideological bias rather than sound economics. Tariffs, often associated with conservative or protectionist policies, are quickly condemned as harmful to the consumer. Corporate taxes, favored by progressives as a way to “make the rich pay their fair share,” are treated as harmless — or even beneficial — to the average worker.
Yet the same economic mechanisms apply in both scenarios. Businesses respond to cost pressures predictably: they shift, reduce, or offset them where possible. Whether the cost comes from a tariff or a tax, it’s still a cost — and businesses rarely absorb them without consequences.
The Bottom Line
To argue that tariffs raise prices but corporate taxes do not is intellectually dishonest. Both are government-imposed costs on private industry. Both can ripple through the economy in the form of higher consumer prices, reduced investment, or lower wages. Pretending otherwise isn't just bad policy — it’s bad logic.
Economic policies deserve to be debated honestly. If the goal is fairness, then consistency should be the starting point.