EXCLUSIVE: The Daily Wire Speaks With Rep. Thomas Massie About Trump Tariffs, Picking Economic ‘Winners And Losers’

On Friday, The Daily Wire spoke with Rep. Thomas Massie (R-KY) regarding the tariffs the Trump administration has imposed on solar energy components, steel, and aluminum.

We also discussed the impact of tariffs and subsequent trade wars on the economy and goods produced in the United States.

DW: Several months ago, the Trump administration placed tariffs on solar energy components. What is your opinion on those tariffs?

MASSIE: At the end of the day, solar panels are a commodity – and this is going to be a theme that I’ll repeat when we talk about the steel and aluminum tariffs – I don’t think that any CEO of any company says, “Oh wow, we’ve got a tariff now. Let’s build a new factory because this tariff will be there to protect our domestic industry.” They know that tariffs can be ephemeral, that they could go away like a stream that dries up in the summer.

I tweeted today: “Can the following two things simultaneously be true? (1) A 25% tariff on steel is necessary to buttress our domestic steel industry for national defense purposes. (2) As soon as other countries axe their tariffs, we will axe our tariffs, including the 25% tariff on steel.”

At that point, wouldn’t you be compromising your national security because you’re leaving the domestic steel industry naked?

Perhaps a company has a marginally-profitable factory that would cost a lot to shut down and reopen – maybe they’ll keep that factory open while the tariffs are in place – but I don’t think they’re going to invest in new equipment based on a tariff, particularly not with these contradictory statements coming from the administration.

DW: The Trump administration introduced tariffs on steel and aluminum; other countries reacted by introducing counter-tariffs on various goods. Now, the administration has proposed a $12 billion aid package for farmers who are in jeopardy as a direct result of this trade war. What is your take on that?

MASSIE: When you implement tariffs, you touch off a lot of things. The trade wars sort of start out like a hot war. There was a justification for the first move – the president invoked “national defense” for the steel tariffs, and that was his authorization, which I don’t think Congress should have ever given him. I don’t think the Founding Fathers ever intended for one person to be able to raise a tax. They only trusted the House of Representatives to even originate those types of bills.

But given that we’re in this situation, the legal justification was “national defense.” China and other countries retaliated, then we are retaliating to them, so the justification becomes retaliation, not “national defense.” So, now that it’s started, the president has even more authority to wage a trade war than he did, I think, initially, if you look at it from a legal standpoint.

[Massie moves to a related topic regarding tariffs, namely that legislators seek exemptions on behalf of companies in their districts, leading to winners and losers being chosen by the executive branch.]

Wilbur Ross came to talk to the GOP conference a few weeks ago. It was in the morning and a lot of people were busy, but there were still 30 Republican members who showed up. I showed up – not to ask a question, but to listen. It seemed to me, of the 30 members of the GOP who were there in a queue, each taking their turn to talk to Ross, 28 of them were there to ask for exemptions for a company in their district.

This is what you get into with a fairly steep tariff. There’s even a website at the Department of Commerce where you first have to lodge your application for an exemption; you have to make the case that the hardship is so great, not that it will raise your prices, but that it will put you out of business. I think they’ve got thousands of applications pending already.

This is the kind of mess you get into. It seems to me that the people who have the loudest voices in D.C., the ones who are best equipped to make a compelling case, are the ones most likely to get the exemption. So now you’ve enriched the executive branch with more power because they can grant exemptions.

DW: Are you anti-tariff entirely?

MASSIE: If you wanted to replace the income tax with a broad-based tariff [a sales tax on everything, or a broad-based tax on everything coming across the border], I would consider that because I don’t think it’s any worse to tax consumption than it is to tax the fruit of your labor.

DW: There are some conservatives who would prefer a consumption-based tax over an income tax.

MASSIE: It was technically impossible to have an income tax until the 16th Amendment, and our Founding Fathers derived 90% of federal revenues from tariffs.

DW: And that was in a different time, of course, before we had what we have now, which is a standard income tax.

MASSIE: Yeah. The reason I point that out is that when you do something that’s broad-based, you don’t give the government the chance to pick winners and losers – but that’s what they’re doing now. In the imposition of the tariffs, they’re picking winners and losers, and then in the granting of exemptions, they’re picking winners and losers.

DW: Coca-Cola just announced that they plan to raise the price of their carbonated beverages, and they laid some of the blame at the feet of the steel and aluminum tariffs. Ardent Trump supporters argue that Coca-Cola is just using the tariffs as an excuse to blame the president for their price increase. What’s your response to that?

MASSIE: I don’t like to argue the knowable, and we could calculate exactly how much their cost increased. So it’s probably on the order of maybe one penny per can, and so, if they raised their prices more than 24 cents a case, then that’s the degree to which they are just taking the opportunity to blame tariffs. Anything below that could be the result of the tariffs.

DW: You’ve already touched on this in your answers to previous questions, but to get your macro opinion in one answer – why do believe tariffs are a bad idea in today’s world?

MASSIE: Again, let me concede that I don’t like any tax, and I won’t say that a tariff is worse than an income tax. However, these sorts of tariffs are really bad because now you have one branch of government deciding when prices should be higher or lower, and what a “fair price” is. That goes against everything that someone who supports a free market stands for. It’s the fact that they are selectively imposing tariffs on one end and selectively granting exemptions on the back end that makes this undesirable.