MONMOUTH, ILLINOIS (April 16, 2025) — Tax season officially ended earlier this week with the deadline to file income tax returns.
But talk of a very specific tax — tariffs — is dominating conversation in the United States, and likely will continue to do so throughout the weeks to come.
Among the Monmouth College professors with tariffs on their mind are business professor Dick Johnston (above) and political science professor Jessica Vivian (below). Johnston, a thirty-year veteran of Monmouth's faculty, has had the tax on his teaching syllabus for years.
"A tariff is a tax on imports," he said. "I've taught about tariffs long before they became this incredibly important current issue. Early in the United States' existence, the federal government was financed almost solely by tariffs."
Over the years, Vivian has had occasion to mention them in her classes — "tariffs can be an effective foreign policy tool," she said — but now they're in the headlines every day.
"Defensive tariffs are made to protect production," she said. "But President Trump uses them offensively, like economic sanctions, to try to punish countries for actions they've made and to persuade other countries not to do those actions. It's leverage, or a tool, or a threat, whatever. It worked in Colombia," where the president leveraged tariffs to successfully resolve national security concerns with the South American nation.
It didn't work nearly a century ago, pointed out Johnston, who referred to the ill-fated Smoot-Hawley Tariff Act, passed in 1930. Meant to protect American farmers during the Great Depression, other countries retaliated against the high tariffs.
Global trade declined and the economic downturn of that decade escalated.
"Eventually we stopped enforcing it," said Johnston. "Is history repeating itself?"
Another 'T' word — trade
"A tariff ends up being paid for by the consumer," said Johnston. "That's the intention. The intent is to raise the prices of imports and make the consumer poorer, hoping they'll buy domestically-produced goods and services," which wouldn't be produced cheaply in a foreign country, but at a higher price by a US labor force.
"We can have cheap stuff or we can have well-paying jobs, but we can't have both," said Vivian.
Historically, instead of driving all production of what Americans consume to within our border, the US trades with other countries."If we truly had free trade, that would help all economies," said Johnston. "Voluntary transactions only happen if both the buyer and seller expect to be better off. Neither party perceives it as equal for equal."
Pointing to a regional example, Vivian said that trade typically benefits both countries, and "those benefits are widely dispersed. But there is a trickle-down effect. The loss of Maytag, for example, was devastating for Galesburg. The downside is localized and concentrated.
"Trump simplified the equation, not that trade is complex, but that it's bad," she continued. "Free trade is being used as a scapegoat. He's taken the anger over conditions that have glommed onto trade and simplified it — putting all of that collective anger on trade as the cause of things. 'We're getting ripped off,' he says. But it [the April 2 tariff plan] lasted three days, then it was gone, then it was back. There's uncertainty about trade. For the electorate to accept the higher prices, we need certainty."
Johnston addressed another feeling that the electorate has.
"The majority of adults in the United States own stock — whether that's through a 401(k) or something else," he said.
"They invest in stock. What all investors want to see is a stronger economy. The recent plummet in stock prices is voters voting with their dollars."
Those votes were heard.
"It's my opinion that Trump has reversed course because the majority of Americans recognize it's backfiring," said Johnston. "His supporters will say that things like these big market swings have been Trump's plan all along. I say that's nonsense. I think it played out much worse than he anticipated. Trump has said that 'tariff' is one of the most beautiful words in the dictionary. If that's true, then why did he quit supporting them?"
Vivian agreed that President Trump didn't have this type of turmoil planned.
"One thing, it seems to me, is that Trump is not calculating," she said. "He's thinking of it as a 'win-loss' proposition. But if we want to work with another country next week — say, Canada — they're going to remember what we just did. The United States has built up credibility and trust, in addition to the power we have. We're a reliable partner. When Trump uses tariffs in an offensive manner — especially when it's for no particular reason — there's a lot going on there. You're blowing up your alliances. Putting the tariffs on, taking them off, putting them back on. If you keep moving the goalpost, other countries will look for ways around that chaos."
Presidential power
Vivian was also asked how such a major economic and political decision landed on the desk of just one man. Does a US president really have this power?
In a word, no, she replied, saying that Trump had used the "loophole" of a "national emergency" — the International Emergency Economic Powers Act.
"Technically, the power is still with Congress," said Vivian. "There are people who study this and put months and months of work into supply chains and strategy, how we can maximize the benefits and minimize the pain. They do it, they're invested in doing it, and we've made decisions based on it. Now it's a nonsensical formula. It's reckless."
