A common criticism of tariffs is that they lead to higher consumer prices. The elite and their minions push this point constantly on legacy and social media. Tariffs, they argue, are nothing more than a sales tax. But while rising prices may occur in the short term (see clarification at the conclusion of this essay), raising the costs to importers is precisely the point of tariffs: to protect domestic industry from being undercut by cheaper foreign competition, often in the form of Western corporations offshoring production to lower-wage countries.
The honest interlocutor will admit that, when companies offshore, they reduce labor costs and flood the market with lower-priced goods—and that this is the point of free trade. Whether he admits this or not, this reality creates a false choice for the American consumer: buy cheap, foreign-made products or pay more for goods produced in the United States, where wages and labor standards are higher.
The consequences of offshoring thus go beyond prices at the checkout counter. Globalization results in job losses, stagnant or falling wages, and a hollowed-out industrial base. It moreover deepens our dependency on fragile or strategically positioned foreign-controlled supply chains. In any case, the economic fate of the nation becomes increasingly subject to the whims of global financial networks and transnational corporate power.
Cheap goods may seem like a win, but they cannot compensate for the erosion of purchasing power that comes with widespread unemployment and wage suppression. And, in fact, wage suppression is the entire purpose of offshoring and so-called “free trade.” Tariffs are thus a corrective mechanism. They discourage offshoring by altering the cost-benefit analysis. If a domestic producer wants to avoid tariffs when importing commodities to the United States, the logical step is to keep production at home. For foreign producers, the only way to dodge tariffs is to move manufacturing to the US—creating high-wage, value-added jobs in the process.
The result of stemming the outflow of capital, as well as reshoring production, is rising domestic purchasing power. When Americans earn more, they can afford goods that might be slightly more expensive, making the relative price increase negligible in real terms. Rising prices are hardly guaranteed, and will vary across sectors, but whether they do or not, the improvement in economic well-being of the general population offsets the price shift.
Meanwhile, institutions like the Federal Reserve—driven by globalist priorities—have kept interest rates elevated, discouraging investment in domestic manufacturing and reshoring. These monetary policies work at cross purposes with industrial strategies intended to reorient the global economy toward American labor—a vision advanced by Trump and his economic advisers. In essence, unelected and largely unaccountable technocrats are undermining industrial policies that voters explicitly endorsed. This is no accident. Trump’s economic nationalism is a disaster for the transnational project.
It’s crucial to understand that price increases under this kind of tariff regime are not the same thing as inflation. Inflation occurs when too many dollars chase too few goods or when the money supply expands to the point that it devalues the currency. Tariffs, by contrast, reflect a deliberate reconfiguration of how and where value is produced. A higher price tag on domestic goods is not “inflation” or a “tax on consumers”—it’s a sign of labor reclaiming its rightful value in the production chain and of a healthier economy with stronger purchasing power.
Americans have a choice: they can pursue a high-wage, value-added economy where people are employed in productive, dignified work and where the standard of living rises in real terms; or they can continue on our current trajectory: a downward spiral in which profits are prioritized over labor, wages fall, unemployment rises, and we become increasingly dependent on foreign imports that erode their livelihoods and sovereignty.
This dynamic was predicted long ago. In the mid-nineteenth century, Karl Marx and Friedrich Engels told the world that world capitalism would break down domestic economies and national sovereignty. Marx even supported free trade in a speech that same year—not because he believed in the benefits of global capitalism, but because he saw free trade as a force that would accelerate capitalism’s internal contradictions, increase class antagonisms, and bring about its eventual collapse. For Marx, free trade was a means to an end: communist revolution.
In Chapter I of The Communist Manifesto (1848), Marx and Engels described how capitalism conquers new markets: “The cheap prices of its commodities are the heavy artillery with which it batters down all Chinese walls, with which it forces the barbarians’ intensely obstinate hatred of foreigners to capitulate.” Here, Marx and Engels emphasize that cheap commodities are not neutral economic goods—they are the tools of economic and cultural domination, breaking down sovereign labor markets just as colonial armies broke down borders.
In a lesser-known but revealing speech, “Speech on the Question of Free Trade,” delivered to the Democratic Association of Brussels on January 9, 1848, Marx explained why he supported free trade—not because it was good for workers, but because it intensified capitalism’s contradictions: “The protective system is conservative, while the free trade system is destructive. It breaks up old nationalities and pushes the antagonism of the proletariat and the bourgeoisie to the extreme point. In a word, the free trade system hastens the social revolution.”
Marx’s endorsement of free trade was thus strategic. He believed it would expose the exploitative core of capitalism, leading to its collapse. In short, free trade is a mechanism of capitalist self-destruction. Marx wasn’t celebrating globalization—he was leveraging it as a revolutionary accelerant. (I cover this speech in detail here: “Marx the Accelerationist: Free Trade and the Radical Case for Protectionism.”)
Today’s libertarian free-traders and globalists—whether they realize it or not—are enacting the very same policies Marx believed would hasten capitalism’s demise. But Marx himself acknowledged that communism wasn’t guaranteed. For what should happen if the proletariat fails to seize that moment—or they reject communism? In his later writings (e.g., correspondence and notes), Marx acknowledged that the alternative to revolutionary transformation could be what Rosa Luxemburg would later term “barbarism.”
Marx’s theory of the tendency of the rate of profit to fall, developed in Capital, Volume III, offers further insight into the long-term contradictions of capitalism. As capitalists compete, they are compelled to increase investment in machinery and technology (the rising organic composition of capital) in order to boost productivity and lower costs. However, since profit derives from labor—not machines—this process ultimately reduces the share of capital invested in labor and, therefore, the source of surplus value itself.
Over time, this leads to a declining rate of return on capital. Marx emphasized that this tendency does not operate in isolation; it is offset and modified by countervailing factors such as intensified exploitation (e.g., wage suppression), expansion into new markets, financialization, and technological innovation. But these measures only delay the underlying contradiction—one that free trade and offshoring exacerbate by displacing labor and cheapening its cost globally, further undermining the system’s ability to generate profit without deepening crisis.
The logic of his argument—which history validates—helps us understand the looming threat of the Fourth Industrial Revolution—artificial intelligence, robotics, and automation—as the next phase of capital’s quest to overcome the falling rate of profit. As Marx argued, capitalists are compelled to displace labor with machinery to cut costs and stay competitive, but in doing so, they undermine the very source of value and profit: human labor.
Today, the replacement of workers by machines—particularly in logistics, manufacturing, customer service, and even white-collar sectors—serves the same function as offshoring did in previous decades: to reduce labor costs and protect margins in a saturated global market. But just like offshoring, mass automation erodes the wage base that supports consumer demand. Fewer jobs, lower wages, and more precarious employment will mean less purchasing power and deeper economic insecurity. (The End of Work and Value. See also my 2009 essays Late Capitalism and Late Capitalism and Permanent Mass Unemployment.)
If offshoring sent industrial jobs abroad, automation threatens to eliminate them altogether—replacing labor with capital entirely. This is not a speculative future; it is a present reality. Considering Marx’s insights, the AI-driven shift is not some neutral wave of “technological progress,” but the logical outcome of a system trying to maintain profitability at the expense of its own foundation.
Another critical factor in all of this is the suppression of wages and erosion of working-class power brought about by mass immigration. While corporate media and political elites frame open borders as a humanitarian necessity or economic inevitability, the material effect is clear: mass immigration expands the labor supply, putting downward pressure on wages, increasing competition for scarce jobs, and weakening the bargaining power of native workers.
Marx himself noted this dynamic in his writings on the English labor market, particularly in how Irish immigration was used by English capitalists to divide the working class and keep wages low. In a letter to Sigfrid Meyer and August Vogt (1870), Marx wrote, “The ordinary English worker hates the Irish worker as a competitor who lowers his standard of life.”
In today’s context, mass immigration functions much like offshoring or automation: it’s a tool for capital to discipline labor by creating a surplus workforce. The working class is not enriched by this process—it is fragmented, disorganized, and made more desperate. Controlling immigration, therefore, is not about xenophobia or exclusion; it is a necessary part of a labor strategy that prioritizes the economic dignity, job security, and political power of American workers.
It is more important now to restructure the global economy to favor the American working class. And Trump’s approach is precisely the intervention we need now.
This is especially true for those who do not wish to transition to capitalism to save us from capitalism’s death.
Rosa Luxemburg’s famous warning—“socialism or barbarism”—comes from her 1915 pamphlet The Crisis of German Social Democracy. “Bourgeois society stands at the crossroads,” she writes, “either transition to socialism or regression into barbarism.” Later, she sharpens her point. “We stand today,” she writes, “before the choice, either the triumph of imperialism and the destruction of all culture, as in ancient Rome, depopulation, desolation, degeneration, a great cemetery; or the victory of socialism.”
The question is not whether tariffs, reshoring, and immigration control raise prices. The real question is whether we want an economy that supports American workers and strengthens the nation, or one that sacrifices both at the altar of cheap goods and corporate profit. The globalists don’t want Americans to recognize this. They want to keep Americans in a bubble with a short time horizon and no comprehensive grasp of economic history and dynamics.
Whether one agrees with Marx’s vision of the future, his critique of political economy enjoys historical support. No prophet was he, but rather an ordinary man who leveraged the dynamics identified in classical political economy to predict the development of capitalism downrange. This makes it all the more ironic that those on the left still calling themselves Marxists would be so opposed to Trump’s economic nationalism—unless of course, they, too, are accelerationists who want to see the demise of capitalism.
Why would American workers support the same imperialist strategies that are used to derail development and impoverish working populations abroad? It makes no sense—unless you benefit from capital flight or depend on global supply chains as a shareholder or transnational executive.
See my other writings on the question of tariffs: Protectionism in the Face of Transnationalism: The Necessity of Tariffs in the Era of Capital Mobility; Why the Globalists Don’t Want Tariffs. Why the American Worker Needs them; With Reciprocal Tariffs, Trump Triggers the Globalists; Taking Back Our Country from the Globalists; Fareed Zakaria Says Tariffs Never Work. It’s a Lie; In the Shadow of Serfdom: Revisiting Liberalism in the Age of Progressivism.
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A point of clarification, since there is widespread misunderstanding about this. A tariff is technically paid by the importer in the country where the goods arrive, but who actually bears the cost depends on market conditions. If demand for the good is elastic and there are close substitutes, importers may be unable to raise prices without losing customers, forcing them to absorb the tariff and accept lower profit margins. Conversely, for goods with inelastic demand, such as certain luxuries, more of the tariff can be passed on to consumers. Across sectors, competitive pressure among importers keeps prices down, generally preventing cost pass‑through. Indeed, in some cases, exporters lower their prices to offset the tariff. In practice, the burden of tariffs is shared between importers, foreign suppliers, and domestic consumers, depending on demand elasticity, market structure, and pricing dynamics.
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