[Update: Yesterday afternoon (9 April), President Trump reduced his country-specific tariffs down to a universal 10% rate for all trade partners, except for China. See here, here, and here. Note: Trump’s universal 10% baseline rate went into effect today; only the higher tariffs — except for those on China –were postponed.]

At the very end of my previous post, I mentioned the sacrilegious possibility that, were he alive today, the great Adam Smith — patron saint of free trade and free markets — might actually defend Trump’s new round of tariffs on both humanitarian and instrumentalist grounds. So, what are these Smithian arguments, and are they persuasive?

Spoiler alert: I can say right off the bat that Smith’s humanitarian exception cannot be used to defend Trump’s tariffs. Why not? Because this exception is limited to trade barriers that are already on the books. It does not apply to new tariffs like Trump’s! Specifically, Smith’s humanitarian argument appears in Book IV, Ch. 2, para. 40 of The Wealth of Nations, where Smith concedes that “freedom of trade should be restored only by slow gradations, and with a good deal of reserve and circumspection” when the sudden removal of existing restrictions on trade would cause mass unemployment at home. In other words, Smith is willing to tolerate pre-standing trade barriers for a limited time in order to protect those workers who would otherwise lose their jobs if those restrictions were lifted all at once.

To recap, Smith’s humanitarian justification of existing tariffs is limited in scope: it applies only to tariffs that are already in place, not to new ones! That still leaves Adam Smith’s instrumentalist argument, however, which is going to be much harder to dismiss. I will turn to Smith’s instrumentalist exceptions in my next post.