The province of Ontario ran some TV ads quoting Reagan. President Trump claimed they were presented out of context and did not represent Reagan’s positions. He then imposed additional tariffs on Canada.
Here, for the record, is Reagan’s speech:
I started it at 1:14 because the introduction is about some era-specific squabbles with Japan. You can take it back to the start if you want to hear every word.
Here’s a transcript of the middle portion:
When someone says, ‘Let’s impose tariffs on foreign imports.’ It looks like they’re doing the patriotic thing by protecting American products and jobs. And sometimes for a short while it works, but only for a short time. What eventually occurs is first homegrown industries start relying on government protection in the form of high tariffs. They stop competing and stop making the innovative management and technological changes they need to succeed in world markets. And then while all this is going on, something even worse occurs. High tariffs inevitably lead to retaliation by foreign countries and the triggering of fierce trade wars. The result is more and more tariffs, higher and higher trade barriers, and less and less competition. So soon, because of the prices made artificially high by tariffs that subsidize inefficiency and poor management, people stop buying. Then the worst happens. Markets shrink and collapse. Businesses and industries shut down and millions of people lose their jobs.
This is for your information. I am neither endorsing nor refuting, neither agreeing nor disagreeing with Reagan’s positions.
It is clear that the Ontario ads did accurately reflect Reagan’s position, whether it was right or wrong.
But it’s not an AI generated speech as Trump now claims…
Yes, that’s the point. Reagan may have been right or wrong, but he really said those things. The quotes in the speech are not AI and they are not out-of-context misrepresentations of his positions.
Trump is following the standard Roy Cohn playbook:
* Defend yourself with a lie, and when you get caught, just cover it up with another lie.
* If you have to change your story, just state a new story confidently, without ever admitting it is a change.
* Always blame your accusers of something and make them the story.
Reagan supported the tariffs on Japan (and had previously imposed in 1981 non tariff quotas on Japanese autos) because he did not believe in unilateral disarmament. He was willing to use tariffs and other measures to try to force other nations to lower their tariffs and, at that time, Japan had one of the most closed markets in the world.
Reagan, one of the few things I agree with him on, was an ardent free trader, unlike Trump who supports the general use of tariffs including falsely believing that the foreigners pay the tariff. At the same time Reagan was imposing these tariffs on Japan, he was negotiating the original free trade deal with Canada. Most Americans probably aren’t aware of this, but even at that time, Canada had about as much trade with the United States as Japan did (Japan mostly exporting into the U.S), so this was not some minor agreement for the United States even if it didn’t receive a lot of attention in the United States.
Reagan sought this free trade deal because he was alarmed at the rising protectionist sentiment in Congress and wanted to do an end run around it (which succeeded.)
In terms of Japan, I don’t believe they ever gave into the pressure of these U.S tariffs and non tariff quotas, but there economy collapsed in 1990 due to the bursting of a large asset bubble and the Japanese economy has never been as important since and I don’t know that it’s ever fully recovered.
While I think Reagan’s rhetoric is hyperbolic, he is likely referencing the Smoot/Hawley tariffs that were passed in the U.S after the start of the Great Depression, he makes a lot of valid points. For instance, the reason the Japanese automakers caught such a large share of the U.S car market in only around one decade prior to 1981 or so, is because American automobiles, facing little competition, made terrible cars except for the luxury market. They were referred to by Americans as ‘rust buckets.’
So, I agree that protectionism ultimately leads only to higher prices and low quality.
While I doubt that Reagan would have imposed any official set of demands on the U.S auto makers when the U.S government bailed out the industry and imposed these quotas on Japan, the new American auto CEOs like Lee Iacoca, promised that ‘quality would become job one’ and they kept that promise.
Forgot one point on this, before Reagan, during the Reagan Administration and for a few years after the Reagan Administration, GATT (General Agreement on Trade and Tariffs) and then the WTO successfully led negotiations that lowered tariffs all around the world from something like an average of 27% post World War II to an average of around 5% about 50 years later. And until Trump,. tariffs I believe were lowered further down to about 2-3%.
So, this genuine world accomplishment has been undone by Trump. To be sure, free trade is a benefit to everybody at the macro level but there are losers at the micro level. These are specific losers in specific sectors, while the gains from free trade are diffuse. And, to be sure, the businesses and their elite owners, executives and shareholders, that mostly benefited from free trade poisoned the well by taking nearly all the gains from free trade for themselves. Reagan and the corporations were responsible for that as well through the Friedman Doctrine which took on legal force during his Presidency that ensured that corporations were only responsible for their shareholders and not to their workers or the communities that they were situated in. So, this isn’t all on Trump.
However, one final point, while I don’t agree with the argument that manufacturing or manufacturing workers are somehow special so that all consumers should have to pay higher prices and have less choice (and end up with lower quality) in order to protect this one supposedly special sector, the reality is that in the United States manufacturing has not declined over the last 45 years or so in an absolute sense.
While manufacturing was about 25% of U.S GDP in 1980 or so and is now 10% of GDP, that is a relative measurement: 10% relative to all the other things that comprise GDP. This is because the U.S economy has grown in real terms by about three times since 1980. (Check out ‘the rule of 72’ when dealing with compounding situations to see this makes sense) and going from 25% of GDP to 10% simply means that manufacturing in the U.S has flatlined while other industries have grown. Of course, manufacturing now employs many less people in the U.S but on a real $ basis, manufacturing generates as much revenue for the U.S as it did in 1980 or so.
Reagan’s daughter had nice boobies.
Good point. If Ontario had just worked that into their ad, it would have held our near-sentient jar of bronzer’s attention. Instead of tariffs, we might have gotten a new tit-centric beauty contest.
I often think the US should have put a modest tariff on Chinese goods when the United States first decided to trade with them. That is because free trade with China was not fair trade. Chinese workers had rights or real labor unions, and safety regulations there were very weak compared to here, Furthermore, their factories were not subject to pollution regulations anything like ours. And finally, their health care was provided by the government rather than their employers. All these things gave them an advantage over our manufacturers.
The fact that they were a repressive, undemocratic state should also have been taken into account.
I am not suggesting an exclusionary tariff, but a revenue tariff, to provide money to assist manufacturers, or at least workers, affected by Chinese imports.
Blame US business that moved offshore for a lot of that.
I didn’t have time to respond to this earlier. Mainsream economists generally oppose tariff measures like this for several reasons.
1.Low wages are only part of the equation. Economists don’t look at wages so much as output per worker (labor productivity.) I know they don’t really exist, but if a Chinese worker produces one widget per hour, and an American worker produces 1,000 widgets per hour, if the Chinese worker is paid 1/100 the American worker, the Chinese worker is still uncompetitive.
This is not because the Chinese worker is less capable, but either because they would have less efficient machinery or less training/education.
2.Of course, in general that might have been true in the 1970-1990s when the United States first started to trade with China, but certainly Chinese productivity has increased significantly since then and Chinese wages have probably not kept up. I don’t know a great deal about China’s economy but as far as I can tell, China appropriates a great deal of Chinese GDP (aka taxation) for massive public works projects. So, if take Chinese pre-tax income Chinese wages may have kept up with their productivity gains.
3.Even if not, what should happen is that as Chinese exports increase, this necessitates the purchase of more Chinese Yuan which should make the Yuan rise in value relative to other countries and makes Chinese exports more expensive. This acts as a kind of ‘natural’ tariff. However, there have been stories for years of China manipulating its currency to prevent it from rising, and I’m aware whether China actually does this or not, or currently does it, is a matter of significant debate.
4.In terms of the NAFTA not with China but with Mexico, there were attempts to prevent Mexico from artificially keeping its wages low through a ‘side accord’ on labor rights that President Clinton negotiated. My understanding is that this has not worked in practice, but I’m not sure who or what is to blame for that.
5.In broader terms, you and this are correct. Mainstream economists agree that there is no true free trade without free movement of labor. However, that is obviously politically untenable. So, we are left with the workers themselves in countries like China and Mexico demanding a greater share of the income generated from trade, effective protections for labor rights in free trade agreements or a rising currency due to increased exports.
6.I disagreee on pollution regulations. This often isn’t appreciated since the national chamber of commerce convince the media that environmental regulations are nothing but an expense, but the reality is more complicated. I agree in the short term that tends to be true, which is why I’ll always argue that the Reagan Administration’s economic policies other than promoting free trade were ‘short term gain for long term pain.’ Many economic sectors are hurt by the pollution/environmental degradation caused by another sector. Off the top of my head are agriculture, forestry and tourism. This is from Google A.I, but I’m pretty sure it’s true: Agricultural productivity in India is significantly harmed by pollution, with major impacts on crop yields, soil, and water quality.
So, not only does Indian agriculture lose out with smaller yields, but they likely receive lower prices on world markets due to their food being regarded as lower quality.
And again from Google A.I: Pollution harms forestry by damaging tree health, contaminating forest ecosystems, and altering the environmental conditions required for growth and survival. The effects of pollution lead to slower growth, increased vulnerability to disease and pests, and long-term forest decline.
While some of the pollution is worldwide, with agriculture and forestry much of them are more local. I believe forests, prior to the wildfires caused by global warming anyway, were mostly harmed by coal burning which is a local effect.
I believe
I acknowledge that I’ve said a number of times ‘my understanding’/’I think’/’I believe’, economics provides a framework for understanding the economy and things that happen in the world in general, but obviously by itself it doesn’t provide the specific knowledge. It’s the idea of knowing the right questions to ask rather than knowing the answers.
How timely. Luckily we can call them dumb fucking canucks because they are the whitest nation on earth which apparently makes them the most evil nation on earth.
Canada was very bland and Wonder Bread white when I was a kid, and the stereotype has lingered.
But in reality:
* Toronto is the fourth most populous city in North America, and only 48% of the residents were born in Canada.
* In terms of color, only 43% of Toronto’s population consists of European ethnics.
So, as usual, we can blame non-white immigrants! Those suckers can conveniently be blamed for everything, although we really have to reserve plenty of blame for the Jews, because we will need them as a scapegoat elsewhere.
Meanwhile the stock market is up 20% since the tariffs were announced.
Times change.
Treating the stock markets like they’re some all knowing God is a big mistake.
Indeed. It doesn’t always mean what we think it does.
When Hoover took over as President, the Dow was at 310. By September it had soared to 381, the all-time record, and more than a 20% gain in just eight months – a close parallel to the numbers introduced above by Trutherbob. As the song declared, happy days were here again.
I think we all know what happened after that. The Dow would not rise to that level again until November of 1954, more than a quarter of a century later. Adjusted for inflation, the September 1929 record would not be topped until 1961!
I am not predicting doom here. I’m just noting that it is not always easy to distinguish healthy growth from a bubble.
Lets be honest, everything is team sports nowadays with the DOW, GDP, inflation rate, unemployment rate, gas prices, and crime rate as the scoreboard. All of which can be manipulated and often rely upon other causes besides who is in the White House. And for MAGA it’s what Trump, FOX News, Truth Social, and various other conservative brainrot outlets its simply making emotionally charged statements about the state of the country.
Like Newt Gingrich said long ago in some interview, the facts don’t matter it’s how people FEEL. Irony from the party that says facts not feelings, but nevertheless that’s how the GOP and their propaganda outlets operate. Crime rate went down in Biden’s last year, but the propaganda outlets could always find an anecdotal heinous crime to spotlight. Now? They show national guard and ICE on TV with all their functional law enforcement activities of gardening and arresting grandmothers.
It doesn’t matter though – all that matters is how they FEEL. Drip feed that MAGA brainrot to them, and they’re basically in The Matrix no matter what goes on in the outside world.
Perhaps you should be President instead of Trump, because “times change” is what he should have said, rather than lying about whether the ads fairly represented Reagan’s words.
Not so many years ago it was the Democrats, representing their labor union base, who were advocating protectionism. Democrats in the 1980s were motivated by concerns that American jobs and industries were being hurt by cheap overseas labor and a growing trade deficit. Conservative Reagan was the free markets/trade guy
And yet it was not many years before that when Republicans were into protectionism (led by the infamous Hawley and Smoot), while the Dems fought for free trade.
As you said, “times change.”
That’s because of the AI bubble, genius. Has nothing to do with tariffs.
“Ken Clawson wrote the Canuck letter. The deputy director of White House communications *wrote* the Canuck letter.”
Whilst tariffs can definitely serve as legitimate instruments of economic policy, the intention is to apply them with strategic intent and precision. But by the current administration’s own admission (when they showed their alleged ‘formula’), these tariffs aren’t designed to correct trade imbalances or protect domestic industries, but instead to generate revenue at the expense of the very people who voted for him to reduce prices. In fact, by all accounts, most of these tariffs are just based on Trump’s mood at any given time.
But hey, I’m sure all of Trutherbob’s stocks have gone through the roof now and he can finally retire and be done with us foolish plebs? Right, Bob? Right? Thought not.
In regards to the ad itself, it’s debatable whether this is what motivated and angered Trump or not. Trump’s gave an initial public reaction to the ad saying something like “If I was in Canada, I’d do the same thing.”
Around this time, a couple American auto companies were announcing they were stopping production at a couple plants in Canada and expanding production in the United States. These American auto companies had received Canadian government subsidies so the Canadian government responded by placing tariffs on these U.S auto companies. Trump had previously refused to negotiate with Canada until Canada dropped all counter tariffs on the U.S.
Meanwhile, Trump officials negotiating with Canada were complaining about Canada’s ‘intransigence’ I.E Canada wouldn’t give Trump everything he wanted. Then, this Reagan Foundation (or whatever it’s called) falsely claimed that the ads took Reagan out of context on free trade and that the Ontario government didn’t have permission to use this video even though it’s in the public domain. So, it seems that the Trump people have taken over The Reagan Foundation as only a few months prior this foundation promoted this video to contrast with Trump on tariffs and trade.
So, most likely Trump is just using this as a convenient excuse to break off the talks with Canada presumably in hopes that this will make Canada more likely to cave. The one thing it’s done though is expose far more people to this video which has Reagan explaining why tariffs are a bad idea even if his arguments are a bit hyperbolic.
I have read that the Reagan Foundation is now run by some of Trump’s lickspittles.
I agree with Adam’s comments. The ad itself – which Trump earlier had kind of admired – is unlikely to be the actual reason for the break-off of negotiations. Trump’s ‘anger’ at the ad is just a pretext for a standard Trump negotiating ploy that is trying to make Canada humbled, desperate and grateful for any eventual return to trade negotiations, and that will try to force Canada to make more concessions when that time comes. There are some pretty clear indications, including the sub-text of comments from White House staff, that this is the case.
All that said, it does seem from other comments coming from Washington that Ontario Premier Ford’s statements and actions have particularly gotten under Trump’s skin since the beginning of the trade dispute early in 2025. The irony of this is that Premier Ford himself is a folksy, limited-intelligence but ‘canny’, right-wing populist in the vein of a mini-Trump (albeit not nearly as ‘out there’ as Trump in those regards). Trump’s reaction is perhaps not surprising though because Trump has shown before that he particularly detests Trump wannabes – look at his attitude to Ron DeSantis. In Trump’s worldview there is only room for ONE big orange turd.
It is also notable that given that Canada, like the U.S., is a federation, Premier Ford does not actually represent Canada in these negotiations. In the same way that Canada is not negotiating these trade issues with Gavin Newsom, Tremp is not actually dealing with Ford, however much he might be annoyed by him. And the Canadian government does not control Ford any more than Trump controls Newsom.