Lots of people think Vladimir Putin is a detestable human being, but not all who disdain Putin think the U.S. should side with Ukraine in its war with Putin’s Russia.
Sen. Lindsey Graham plainly dislikes Putin while also believing deeply in Ukraine’s war. Too bad Graham's legislation meant to protect Ukraine would mark the beginning of the end of Urkaine's independence. Please read on.
Graham is proposing legislation that would levy a 500 percent tariff on market goods shipped to the United States from any country that buys energy from Russia. What Graham proposes vandalizes economics. With all goods that have a market value, it’s inevitable that they’re somehow, some way going to find their way into the global market.
Precisely because Russia needs the oil revenue, and because the world needs its oil, there will be no keeping the oil extracted in Russia, in Russia. Short of a blockade of a nation so large as to require eleven time zones, so-called “Russian oil” will flow. And it will be consumed as though it had bubbled up in Sydney, Shanghai, Seattle, and any other city the production of which rates copious amounts of imports.
At the same time, it’s worth considering the 500 percent tariff Graham blithely happened upon assuming it could be implemented. The economic devastation implied in such a monstrous tax at least partially explains Sen. Rand Paul’s opposition to it beyond the tariff vandalizing economics, while also running counter to Paul's own Ukraine policies. 500 percent?
Do readers remember the market reaction to President Trump’s mindless brinksmanship with China over taxes on imports that crossed the 100 percent line? To say that 500 percent would deliver the U.S. - and by extension the world – enormous amounts of carnage is putting it much more than lightly. And that’s true even if countries like China (which the legislation is plainly aimed at) wisely choose to not retaliate.
Even if China were to sit on its hands while the U.S. self-flagellated in front of the rest of the world for Ukraine, the impact of the U.S. taxing Chinese imports at 500 percent would be devastating for Americans. How we know this to be true can be found in the fact that Apple sells a fifth of its iPhones in China, McDonald’s has 5,500 stores in China on the way to 10,000 in 2028, Starbucks has 7,000+ stores in China, Nike sells more gear in China than it does in any country not the U.S., GM sells more cars in China than in North America, etc. etc. etc.
What the numbers about U.S. sales in China tell us is that exactly because Americans purchase so much Chinese production, the Chinese people purchase a great deal of American production. Which means if Sen. Graham and other economic illiterates in the U.S. Senate were able to turn their fantasies into law, the subsequent U.S. economic downturn would make 2008, 1982, and the 1930s appear boomtime by comparison.
The easy thing to write at this point is that Graham means well, but that’s going too easy on the South Carolina senator. That is so because underlying the legislation is a concern for Ukraine’s national security. Get it?
If not, it must be said that legislation that would crush the U.S. economy would mark the end of Ukraine’s independence. Translated, the U.S. can’t help Ukraine or any victims of Russian aggression if the U.S. is economically prostrate. Lucky for all of us that Sen. Paul grasps economics in ways his fellow senators plainly do not.
