The Coyote Has Crept Out of the Bag
Not-so-bright Trump supporters are getting the economics lessons they didn't get in high school.
Two days after America voted resoundingly to experiment with fascism, a meeting was held at a manufacturing company in southwestern Pennsylvania. So you know, this area, despite all of the big rallies Kamala Harris had in the area, voted as red as they could. Imagine the glee among the gathered employees when their CEO gathered them into the company hall to address them about the election results.
“We did it! The future will be so bright that we all must wear shades (Corey Hart song).”
The company’s CEO, however, planned to weave a different tale of woe at that late-morning meeting.
“Thanks to Donald Trump’s victory yesterday,” the gathered employees hooted and hollered in joy over the nation’s perceived good fortune. Readying themselves for the ‘good news,’ the CEO continued: “Christmas bonuses this year will be canceled.”
Nervous laughter rippled through the crowd. The hard-working, highly productive employees waited for the punchline.
“This isn’t a joke. When Trump imposes tariffs next year, we will be hit with a 25 percent increase in inputs. An increase like this could crush our momentum and cause the company to go bankrupt. We will stock up for the next year at least on imported inputs.”
The employees were aghast. How could their CEO not understand how tariffs work? Some of the more upset employees shouted from the crowd.
“Why are we paying the tariffs? It’s the Chinese who have to pay them.”
“First of all, we don’t import anything from China,” the CEO began. “We import from Germany, and the Germans will pay the tariff, but not out of their pockets but our pockets…and then, we will have to raise the price of our finished goods by 25 percent, which sooner or later trickles down to all of us, the consumers.”
Beating hearts could be heard as stress levels rose at the prospect of losing Christmas bonuses.
“You got it wrong. Trump said they will pay and it will grow American business.”
The CEO smiled. “That’s what Trump said so you would vote for him, but the reality is the tariffs will stunt growth in our economy and raise prices — which we all know is called inflation.”
Faces grew angry, and the CEO realized he was getting close to mocking them to their faces. He decided to ease their pain as he watched them struggle to swallow the reality of a Christmas without bonuses.
“Look, none of us, including me, are getting bonuses. I will likely take a substantial pay cut, and by buying enough to cover our needs for next year, there likely won’t be any need for layoffs.”
The word “layoff” hung in the air like an acrid smell.
“Listen. Economics is complicated, but some things are pretty straightforward. A tariff is one of those things. We can’t make what we make without the parts from Germany. The Germans are the only company worldwide that can provide us with the necessary quality. We have no choice but to pay the price they ask. If the German company cuts their prices by 25 percent, thousands of Germans will be laid off. At the end of the day, why would they lay off their employees just because our president decided to impose an unnecessary tariff?”
The meeting ended, and the employees who failed to pay attention in high school left feeling a little smarter thanks to the lesson in economics — both micro and macro — 101.
They also left feeling duped for believing Trump without first fact-checking his claims (some would say “lies”) about tariffs.
Did this really happen or is it a fable to prove a point?