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The Editorial Board of the Wall Street Journal hopes that the U.S. Supreme Court reins in the use of the banana-republic practice of civil asset forfeiture. Two slices:

One progressive fiction about the Supreme Court is that it’s busy serving billionaires and big corporations. Far more often its best work is defending individuals against state power, and on Monday the Justices agreed to hear the case of an Alaskan bush pilot who had his airplane seized over a few cases of beer (Jouppi v. Alaska).

…..

Governments increasingly use criminal and civil forfeitures and fines to pad their budgets. In 2023, 45 states collected nearly $300 million, according to the Institute for Justice, which represents Mr. Jouppi. This aggressive law enforcement diminishes American civil liberties, and the excessive fines clause should be a shield against such overreach. Mr. Jouppi’s plane sure looks like it qualifies.

Scott Lincicome makes clear that “Trump’s new tariffs aren’t about forced labor — they’re about restoring the tariff wall.” A slice:

In my new column at The Dispatch, I show why these tariffs have almost nothing to do with forced labor and instead are just “a ham-fisted way to reinstall Trump’s tariff wall and protect it from another IEEPA-like defeat in federal court.” Five issues stand out:

1. The administration said the tariffs were coming before the investigation ended. President Trump, Treasury Secretary Bessent, and US Trade Representative Greer all publicly and explicitly promised that the tariffs and their revenue would replace the struck-down IEEPA regime before the investigations even started.
2. The requisite report on “forced labor” is remarkably thin. USTR’s investigation only took 82 days and generated a 98-page report to cover 60 economies, devoting little more than half a page to each, much of it the exact same empty passages copied and pasted 60 times—far short of the rigor demanded of such a consequential and far-reaching trade action. The report also contained no evidence or analysis – none – of targeted economies’ forced labor policies causing actual harm to US companies or commerce. It’s all just assumed. Nor did the USTR explain why it applied the same punitive 12.5 percent tariff rate to Angola, Libya, Russia, Venezuela, and Kazakhstan—developing countries that rank low on the Walk Free forced labor index (and have other issues!)—as it did to developed, “good actor” countries like Norway, Japan, Switzerland, and Australia.
3. The United States is hardly a forced labor angel. Section 307 of the Tariff Act of 1930 has prohibited imports made with forced labor, but was lightly enforced for over 80 years due to wide exceptions, and the Trump administration’s enforcement of the law has been much more lenient than the Biden administration’s efforts. Furthermore, the US ranks 19th among the 60 economies for the prevalence of forced labor.
4. The tariff cure dramatically overshoots the forced labor disease. Some back-of-envelope math puts a proportionate tariff at 0.5 to 0.84 percent; Peterson Institute economist William Cline, using a different model, gets 0.23 to 0.25 percent. USTR is proposing 10 to 12.5 percent, a rate and resulting revenue (see figure below) that far exceed what could be considered a proportional response to the problem.

Eric Boehm explains that Trump’s new ‘forced labor’ tariffs are likely illegal. A slice:

Ostensibly, these tariffs are meant to combat “forced labor.” The Trump administration says the tariffs are the result of an investigation into 60 foreign economies that “fail to prohibit or to effectively enforce a prohibition on the importation of goods produced wholly or in part with forced labor.”

Immediately, a logical problem emerges. The announcement says that the 10 percent tariff will apply even to countries that “impose a forced labor import prohibition,” as long as the administration believes that prohibition is not being adequately enforced. It is unclear what, exactly, a foreign country would have to do to get removed from that list. That makes it fairly obvious that combating forced labor is a pretext for what the Trump administration really wants to do: have more tariffs.

And here’s National Review‘s Andrew Stuttaford on Trump’s new tariffs punitive taxes on Americans’ purchases of imports. A slice:

After the Supreme Court struck down tariffs introduced under the International Emergency Economic Powers Act, the president responded by announcing a new global tariff of 15 percent. This was based on Section 122 of the Trade Act of 1974, which allows for the application of various Band-Aids to problems arising out of large and serious U.S. balance-of-payments deficits. The administration’s use of Section 122 to impose tariffs (which was unprecedented) has come under legal attack. But at this point that’s moot (apart from the tricky issue of the tariffs that have already been paid), as Section 122 tariffs could last no longer than 150 days, a period that has just expired.

Protectionists can relax, however. The administration will now be taking action under the Trade Act’s Section 301, a widely drawn provision that allows the U.S. to take action if its trade representative determines that an act, policy, or practice of a foreign country is unreasonable or discriminatory and burdens or restricts U.S. commerce, and that action by the United States is appropriate. It has been used to impose tariffs fairly frequently before. In this case, tariffs have been slapped on countries for failing to “impose and effectively enforce a prohibition on the importation of goods produced with forced labor.”

The timing is . . . convenient.

GMU Econ alum Erik Matson writes wisely about Alexander Hamilton. A slice:

The real tell for Hamilton comes in the “Report on Manufactures” when he considers potential counterarguments to his positions. He spends the opening sections of the “Report” establishing the point that manufacturing is no less productive than agriculture. He proceeds to make his case that a booming manufacturing sector would serve America well—and be incredibly profitable. He then takes on the natural question: If manufacturing would be so profitable in America, why does the government need to subsidize it? His answer is surprising, and in a way, it is the centerpiece of his entire outlook in political economy.

Americans—like all people—in Hamilton’s view are too much inclined toward agriculture, too averse to risk-taking, and too committed to the status quo. Americans want to move westward and be left alone. Americans are not sufficiently aware of or interested in profit opportunities. Americans for Hamilton can perhaps be captured with J.R.R. Tolkien’s description of hobbits: “[T]hey love peace and quiet and good tilled earth: a well-ordered and well-farmed countryside was their favourite haunt. They do not and did not understand or like machines more complicated than a forge-bellows, a water-mill, or a hand loom, though they were skillful with tools.”

In Hamilton’s own words: “The desire of being an independent proprietor of land is founded on such strong principles in the human breast, that, where the opportunity of becoming so is as great as it is in the United States, the proportion will be small of those… who would be diverted from it towards manufactures.”

“Experience teaches,” continued Hamilton, “that men are often so much governed by what they are accustomed to see and practise, that the simplest and most obvious improvements, in the most ordinary occupations, are adopted with hesitation, reluctance, and by slow gradations.” So, Hamilton believed the federal government ought to subsidize industrial activity as a way of inspiriting an overly conservative, agricultural population to take up profitable industrial activities.

The irony is that Hamilton himself was an incredibly entrepreneurial and ambitious man, surrounded by an entire cohort of entrepreneurial, ambitious men who rebelled against the most powerful empire in the world and forged a brand-new model of government. Hamilton had every reason to think that Americans, by virtue of self-selection, were of all people less inclined to the status quo than most people and more attuned to profit opportunities. Tocqueville certainly thought so when he visited America in the 19th century: “The American follows not only a calculation of his gain, but an impulse of nature” in trade. But for one reason or another, Hamilton was simply distrustful of the natural market process

Bob Gelfond writes insightfully about free-market money.

The Editorial Board of the Wall Street Journal applauds U.S. Supreme Court Justice Elena Kagan’s defense of the Court against the charge that it’s a rubber-stamp for Trump. A slice:

The Supreme Court is no “rubber stamp” for President Trump. Take it from liberal Justice Elena Kagan. “That is a bad rap,” she said, defending the honor of her institution and her colleagues this week at a Ninth Circuit Court of Appeals judicial conference. She cited especially this year’s 6-3 ruling against President Trump’s effort to aggrandize his tariff powers.

“Tariffs is probably the key policy issue for this President. I mean, something he campaigned on, he ran on, he cared an enormous amount about,” Justice Kagan said, according to Politico. “I don’t think that there are all that many decisions in the recent times, where a court strikes down such an important policy to a sitting President.” A glaring counter-example from 2012 is the High Court’s, uh, creative 5-4 decision to uphold ObamaCare.

Mr. Trump has pushed the bounds of executive power, but so did his Oval Office predecessors, and the current Administration’s record at the Court is mixed at best. Another big one for the loss column this term was Mr. Trump’s order trying to redefine birthright citizenship.

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… is from page 68 of Steven Pinker’s 2025 book, When Everyone Knows That Everyone Knows…:

Rationality is not like a buyer and seller haggling over a price until they split the difference. After all, why should we expect reality to just happen to lie midway between the convictions of two people who find themselves in an argument?

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Here’s a letter to the Washington Post.

Editor:

On July 23^rd the Trump administration announced new tariffs meant to punish foreign governments for failing to adequately prevent “forced labor.” As you report, “senior administration officials said the president’s concern over forced labor was genuine” (“Trump sets new tariffs to punish use of ‘forced labor,’ replacing expiring import taxes,” July 24).

I’m touched by the president’s change of heart. Until yesterday, he was all about ‘putting America first.’ But no more! Mr. Trump’s concern for exploited foreign workers now runs so deep that, to right this wrong, he is willingly foisting higher prices on American consumers and businesses.

His MAGA base will undoubtedly turn on him for abandoning his ‘America First’ policies. But we must applaud Mr. Trump’s poignant move to compel all Americans to make sacrifices to improve the lot of the world’s poorest.

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030

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George Will writes of the collapsing center of American politics. A slice:

The American Enterprise Institute’s Ruy Teixeira, a center-left Democrat, describes a perverse dialectic of “Trumpian overreach”: The more Trump is flamboyantly provocative, the more Democrats lurch into “histrionic, radical, ineffective responses.” He controls the shrillest Democrats by triggering them, and they propel their party toward self-indulgent, self-destructive choices, such as [Abdul] El-Sayed.

[DBx: U.S. politics today makes me want to sing – in a sad, minor chord – “Clowns to the left of me / Jokers to the right.”]

Arnold Kling wisely rejects what he calls “brokenist economics.” A slice:

But when it comes to economics, I am against the brokenists. On the left, the brokenists advocate socialism. They are wrong.

On the right, the brokenists use “neoliberalism” as a boo-word. They claim to be superior to mainstream economists. The particular brand of right-wing brokenism that appeals to JD Vance believes that mainstream economics is harmful. As Akash Chougule writes,

JD Vance has been making an argument similar to those in DSA, simply wrapped in the language of conservatives: that free markets undermine human dignity because they are incompatible with the moral order.

In fact, the Catholic integralists, like Patrick Deneen and Adrian Vermeule, reject the Enlightenment ideas that shaped America. They want to turn the clock back to before John Locke.

Eric Boehm explains what shouldn’t – but, alas, what today nevertheless does – need explaining: “The U.S. economy is not a reality show. The Trump administration should stop acting like it is.” A slice:

Consider one of the biggest challenges facing American businesses in the midst of President Donald Trump’s global trade war: As of Thursday afternoon, no one knew what tariffs would be charged on which imports entering the country as soon as Friday morning.

Trump is no stranger to improvisational, make-it-up-as-you-go policy, but even by his standards, this is pretty ridiculous.

To understand the wild uncertainty facing American businesses this week, you have to back up a few months. In February, the Supreme Court struck down many of the tariffs Trump had imposed last year when it ruled that the International Emergency Economic Powers Act (IEEPA) did not grant presidents the power to impose tariffs. Trump responded by implementing a 10 percent “global tariff” via a different legal mechanism: Section 122 of the Trade Act of 1974.

But that law only allows for temporary tariffs that last a maximum of 150 days, unless Congress votes to extend them, which it has not. As a result, the tariffs Trump imposed in February will expire at midnight tonight.

The Trump administration had 150 days to provide some clarity and stability to American businesses that buy and sell things overseas. It did not do that.

“You’ll have to stay tuned, and you’re gonna be busy over the next few days,” U.S. Trade Rep. Jamieson Greer told The Wall Street Journal earlier this week when asked about the upcoming tariff deadline.

That’s, uh, not very helpful. The U.S. economy is not a reality show. The Trump administration should stop acting like it is.

Alas, the announcement of the administration’s new scheme to tax – a.k.a. “tariff” – Americans’ purchases of imports was announced late yesterday, as summarized by this Washington Post headline: “Trump sets new tariffs to punish use of ‘forced labor,’ replacing expiring import taxes.” A slice:

Many trade analysts described the administration’s action as designed to replicate the tariff system the court toppled this year. The senior administration officials said the president’s concern over forced labor was genuine. They noted that the U.S. prohibition on goods produced with involuntary labor is more than a century old.

[DBx: Who is gullible enough to believe that the Trump administration is choosing not to ‘put America first’ because it is so intent on righting wrongs done abroad?]

My GMU Econ and Mercatus Center colleague Pete Boettke and I recently discussed Adam Smith.

My intrepid Mercatus Center colleague, Veronique de Rugy, decries the lethal opposition to self-driving cars. A slice:

Last year, 36,640 Americans died in traffic crashes. That was the fewest since 2019, yet it still works out to more than 100 fatalities per day. The new generation of vehicles quietly accumulating mileage on our streets offers enormous promise to bring the number down even more and more each year.

Over at Marginal Revolution, economist Alex Tabarrok reminds us that as of March, Waymo’s driverless vehicles had logged more than 220 million miles across five of its areas of operation. Compared with human drivers on the same roads over the same period, and counting every crash regardless of fault, the Waymo Driver was involved in 94 percent fewer crashes causing serious or fatal injury. It also experienced 82 percent fewer airbag deployments and 93 percent fewer injury crashes involving pedestrians.

Jack Nicastro explains that the “App Store Freedom Act” would be bad for freedom. A slice:

ASFA marks a dramatic departure from existing antitrust and unfair competition laws, which are already more than able to provide substantial relief for these types of practices, as shown by courts’ prohibitions of certain anti-steering mechanisms in Epic v. Apple and Epic v. Google. Indeed, unlike the Sherman Antitrust Act, the bill requires no demonstration of market power or dominance before its strictures apply. Moreover, its bans do not require plaintiffs to show anti-competitive harm or allow defendants the opportunity to present procompetitive justifications.

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… is from chapter 1 of William Graham Sumner’s 1885 volume, Protectionism: the -ism Which Teaches that Waste Makes Wealth:

Any one who says that it [a tariff] is not a tax must suppose that it costs nothing, that it produces an effect without an expenditure of energy. They do seem to think that if Congress will say: “Let a tax of—per cent. be laid on article A,” and if none is imported, and therefore no tax is paid at the custom house, national industry will be benefited and wealth secured, and that there will be no cost or outgo. If that is so, then the tariff is magic. We have found the philosopher’s stone. Our congressmen wave a magic wand over the country and say: “Not otherwise provided for, 150 per cent.,” and, presto! there we have wealth. Again they say: “Fifty cents a yard and fifty per cent. ad valorem;” and there we have prosperity! If we should build a wall along the coast to keep foreigners and their goods out, it would cost something. If we maintained a navy to blockade our own coast for the same purpose, it would cost something. Yet it is imagined that if we do the same by a tax it costs nothing.

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