Why is free trade good?
Donald Trump is in a stand-off with Adam Smith
![](https://www.economist.com/cdn-cgi/image/width=1424,quality=80,format=auto/sites/default/files/20180317_BLP507.jpg)
By A.F.
PROTECTIONISM is back. On March 8th President Donald Trump signed into law tariffs of 25% on steel imports and 10% on aluminium, to come into effect two weeks later. It is unclear which countries will be hit. Even if exemptions are expanded beyond Mexico and Canada, this is still a big step for the president to take. Mr Trump tweets that this is for the best. By levying these tariffs, the story goes, the American economy will be better off because jobs in the steel and aluminium sectors will return to the homeland from foreign countries that have “stolen” them. Such thinking has traditionally been known as “mercantilism” and it is easy to see why it appeals. We buy things from that country, instead of making them ourselves. If we made them ourselves, we would have more jobs and this would make us better off. So why is the mercantilist argument wrong?
More from The Economist explains
![](https://www.economist.com/cdn-cgi/image/width=1424,quality=80,format=auto/media-assets/image/20240914_BLP511.jpg)
Who will lead Britain’s Conservative Party?
Here are the four candidates vying for the daunting job
![](https://www.economist.com/cdn-cgi/image/width=1424,quality=80,format=auto/media-assets/image/20240914_USP505.jpg)
When can parents be held responsible for their children’s crimes?
Mass shootings by young assailants are raising the question
![](https://www.economist.com/cdn-cgi/image/width=1424,quality=80,format=auto/media-assets/image/20240907_BLP518.jpg)
Will the debate between Kamala Harris and Donald Trump matter?
Normally presidential match-ups hardly move the needle—but this is no ordinary year
What are the Murdochs fighting about in a secret Nevada court?
The outcome could shape the political orientation of the family’s media empire
The battle between drones and helicopters in Ukraine
Small cheap drones could pose a new threat to expensive Russian craft
A short history of political meddling with the Federal Reserve
Donald Trump’s attacks on the Fed are a throwback to the era before central-bank independence