Hangover

Three years have passed since Donald Trump levied tariffs on imported steel and aluminum. 

Gary Varvel - Indianapolis Star

Hoping to get the attention of (then) Senate Majority Leader Mitch McConnell the (then) European Union retaliated with a targeted 25 percent tariff on bourbon whiskey.  Donald Trump doubled-down with a 25 percent tariff on single-malt scotch and other European liquor. 

You may recall that this was a major inflection point where normally free-trade Republicans lost their collective minds and caved to the Trumpian Theory of solving trade disputes by means of imposing blunt-force tariffs. 

There is a name for this.  

It is called picking winners and losers while passing the costs of the tax increases onto consumers.  Don’t take my word for it though – the winners were domestic steel and aluminum manufacturers who raised their prices to match those of imported metals meaning we all paid more.  On a personal note that was roughly $900 of additional GOP taxes on a brand new Kawasaki Mule.  But I digress.

The losers were Kentucky and Tennessee distilleries as exports plummeted by 50 percent. 

Exacerbating the woes of the distilleries was the evaporation of tourism in 2020 as a consequence of the Covid pandemic.  Economic conditions – especially for the smaller craft distilleries – has been beyond bad. It has been a perfect storm of lost sales, lost jobs, bankruptcies and more.  This economic craziness has tied the fortunes of domestic whisky to that of imported steel and aluminum.  It is the Trump shit show that keeps on giving. 

Making matters worse the European Union and United Kingdom have announced that they will raise the tariff on bourbon whiskey to 50 percent on June 1 if Trump’s trade dispute between the United States and Europe isn’t cleared-up. 

All of which puts Joe Biden, Mitch McConnell and Rand Paul in a wee bit of a bind.  Blue State unions and manufacturers are loath the give-up the artificially-supported rise in the price of steel and aluminum and Red State Kentucky distilleries continue to suffer. 

The dark shadow of Tariff Man's inept and incompetent trade policies persists like a bad hangover.