Now is the time for all good people to choose a side. I ask you: are you pro- or anti-hammer? Don’t temporize, don’t ask for clarification. Hammers are as obvious and tangible a thing as there is: everybody has held one in their hands. Now admit it: which are you?
My friends, all being intelligent, reasonable people, will of course object to this rush to judgment. “Pat,” they’ll say, “hammers are just tools. Tools can be used for good or evil. You can’t automatically and conclusively judge them, only how they are used.”
Poppycock (that’s British for bullsh!t). Hammers can kill people, just ask the Beatles. Even without evil intent, just used as sport, they can be deadly. Hammers are prone to misuse: I used a hammer once to nudge a pane of glass into place with disastrous consequences. And the numbers of times we all have smashed our fingers! In today’s modern world, hammers are unnecessary: think of all the Ikea products you can assemble without ever using a hammer!
Those smug hammer-enthusiasts will counter that hammers don’t kill people, people do. Few things are as satisfying as hitting the nail on the head: that’s why the saying exists, for Pete’s sake! Hammers are safe when used correctly, most hammer collectors are fine people who would never misuse them, and if all else fails, hammers are a fine form of self-defense.
Some of you may be thinking I’ve lost it. Others intuit a defense of the Second Amendment. You’re both wrong (maybe not the first group; the jury is still out on my sanity). I want to talk today about Trump’s favorite word: tariffs. I wrote about candidate Trump’s love of tariffs back before the election, but now we have actual tariff proposals, counters, and changes. And commentary, so much commentary, very little of which is coherent.
The first point about tariffs you already know: they are a tool, and just that. It is true that tariffs (specifically the Smoot-Hawley legislation) were a massively contributing factor to the Great Depression. It is also true tariffs were a primary source of government income for centuries before that event. Were all those governments so stupid? No, they avoided highly-unpopular personal or income taxes by using tariffs. But tariffs don’t work well within a free-trading system, so they eventually went extinct, right? Like buggy whips?
Well, no. Countries around the world have used tariffs and continue to do so. Ronald Reagan slapped quotas and tariffs on Japanese automakers and electronics back in the 1980s, with great effect. By the way, the use of a quota and accompanying high tariff for everything exported about the quota is the same method used by Canada to protect its dairy industry today. No one ends up paying the tariff (which can reach almost 300%!), because the quota simply limits American dairy competition with the Canadian domestic producers. Germany tariffs American autos, Japan tariffs American beef, and so forth. I ask again: are all these governments stupid?
No. Tariffs may protect domestic industry, or help it grow. But not if your country can’t make the product for technical (think TSMC for high-end chips) or environmental (think Tequila or Champagne) reasons, or if your domestic producers simply see the tariff as a chance to raise their own prices and reap greater profit. Tariffs may raise revenue (from whom, ahh, that is a good question for further down the page). But not if you remove them, or people substitute other domestic products for the tariff’d ones, or the companies go ahead and move production to your country. Tariffs may start a trade war as other countries post reciprocal tariffs. But wait a minute. If Trump’s tariffs are a stupid idea that only taxes Americans, what are Canada’s/Mexico’s/the EU’s tariffs in response? Are those governments that stupid?
Earthy Metaphor: President Trump takes a dump on the Presidential seal rug in the middle of the Oval Office. Would you expect Prime Minister Carney (Canada) or Presidenta Sheinbaum (pronounced SHANE-baum, not SHINE-baum; she’s Mexican, not from Baltimore) to do the same in their respective offices? Or perhaps they would refrain from a similarly stupid act?
About who pays tariffs, a meal culpa (times three). In my breezy coverage of Trump’s tariff ideas pre-election, I suggested the exporting country pays the tariff. This is not technically true. The actual tariff payment is made by the importing company, whatever its nationality. But who really pays it? Everybody and nobody. The importer pays the foreign producer for the product, and then on top of that pays the US government the tariff for that product. But the importer is a business, not a charity: they require profit, and the tariff eats into their profit. What do they do? Well, one thing they can do is raise the price of the good they imported when selling it to the retailer/consumer. In this manner, the end-user or buyer (you and me) pay the tariff. You’ll hear free-traders and progressives alike making this argument.
The problem is, it’s not that simple. If you suddenly raise the price on an item, especially a lot, fewer people will buy it. Or they’ll buy a substitute that is cheaper. If there is no sale, there is no profit at all. So the importer does NOT pass along the entire tariff. The importer “eats” some of the tariff, because making less profit is better than no sale at all. And the importer may renegotiate with the producer, asking them to lower their price (which eats into the producer’s profits), thus sharing the tariff pain, and reducing the tariff (which is based on the price). The same thing goes on throughout the retail chain, with intermediate businesses making fine-tuned decisions about how much they can raise prices, not just passing along the whole tariff. There’s a word to describe businesses which simply pass long any external costs imposed upon them: bankrupt.
Simile: Like asking who pays for the US Army? Well, the federal government. But where do they get the money? From taxpayers, and from tariffs, and from asset-seizures, and from foreign purchases of US bonds. So you, white-collar criminals, and the Chinese government all pay for the US Army. So what?
Now nothing I have said should be construed as suggesting the Trump administration has a finely-tuned, coherent strategy to use the tool called tariffs. They have articulated different reasons for different tariffs, which is appropriate. One constant is that America will place reciprocal tariffs on anyone who tariffs it. Even this doesn’t always make sense. For example, an exact reciprocal tariff on Canadian dairy products would have little effect; they’re worried about American competition, not vice versa. But let’s assume there are competent bureaucrats in the US federal government who can identify the correct equivalent items to tariff.
According to US officials, some of the large, across-the-board tariffs against Canada and Mexico are related to immigration and fentanyl trafficking. There is nothing wrong with using tariffs to garner non-economic policy outcomes. Trump did so very effectively with Colombia with respect to repatriating migrants. But such broad tariffs are like putting a nail between each of your fingers and swinging the hammer wildly: perhaps somewhat effective, but painfully costly.
My best guess here is Trump is using these Canadian and Mexican tariffs as a negotiating ploy. Immigration is dramatically down, but he needs to keep it there. Fentanyl deaths are also declining. I bet Trump will continue to impose, delay, or limit these tariffs, asking for more support from Canada and Mexico, until some point in the near future when he declares victory (for his policies). How much economic pain will that entail? How many fingers will get hit?
There is no legitimate immigration/drug-snuggling rationale for the Canadian tariffs; I don’t think there is a good economic rationale, either. I believe the tariffs with Canada are also personal. First, Trump hates Trudeau, and sought every opportunity to demean him, even after it was clear he was stepping down. Trump also has this odd obsession with enlarging America, and Canada became one of his chief targets, as impossible as that is. Canadians are pissed, frankly, and new Prime Minister (pending election) Carney is feeding off the disgust and talking tough. He has to. His party was set to be wiped out in the elections, but after Trump’s riling up the Canucks, Carney is now tied with Pierre Polievre, the more conservative (relatively) candidate and party.
Whoever wins would do well to look south, all the way to Mexico City, for a different approach. Why? While I admit they’re in the right, and have a right to be upset, Canada cannot engage in a long-lasting trade-war with America. Both sides would be hurt, but one side would have bruises and the other a gaping chest wound. Or a traumatic amputation.
In the end, Canada has to come up with a way to stand up to Trump without burning the log cabin down. Which is why Mexico City is the place to look. Presidenta Sheinbaum has masterfully responded to Trump’s provocations. While some expats friends have reveled on social media about imaginary responses from her to Trump, belittling him (they like how it makes them feel; but they’re not real, because she is way too savvy to respond that way), she has instead demonstrated grace and resilience. She responds specifically to his requests, rather than trying to point out logical flaws or statistical errors. She actually at least tries to address her fellow President’s concerns. She remains respectful, at least of the office, if not the man.
Her results? A much better relationship, some appreciation from the White House (which is rare indeed), and a record approval rate in Mexico. You think this would all be obvious by now, but of course, one could also try to shut off the power to New England (Shout out to Doug Ford!). In the end, I think Mexico is going to trade additional tariffs on China for relief from the United States. For a variety of reasons that are unique to Mexico (and cited in this NY Times piece by Keith Bradsher), Mexico actually has the international right to drop major tariffs on China while China cannot (legally) respond. Look for la Presidenta (I checked, the Real Academia Española does recognize a feminine version of El Presidente) to do precisely that.
The reciprocal or retaliatory tariffs are another thing altogether, and it’s not clear in each case what goal Trump is seeking. Clearly the ones on China and Europe are different, and how they play out will be different. I’ll wait to see more information before I judge them, and suggest you do, too. I don’t believe tariffs are a great thing, or there is a finely-tuned Trump tariff strategy. I also reject the notion that tariffs “are the stupidest thing ever and no sane person could ever support them.” Because many nations, over many centuries, have used them. Like most things Trump, people immediately gravitate to either extreme, which is sad but predictable.
My advice? “Stay calm and mind the gap (in tariffs).”
Interesting piece and I note your refusal to make firm predictions and see the need to wait for more information. I applaud this, since it is hard to do with Trump.
I will argue with you that most reputable economists believe that high tariffs on the whole are counterproductive. Occasionally, they do protect US industries like autos. If Chinese EVs were to be sold in the US , Tesla would be doomed, as would other US and foreign EV makers. For example, Chinese EV maker BYD says its new fast-charging system could be as quick as filling up a tank, i.e., about 5 minutes–this was just announced. And the price point for Chinese cars, compared with other EV makers, is quite low. And apparently, the quality is very good. On the new fast charging, see https://www.theguardian.com/technology/2025/mar/18/byd-ev-fast-charging-system-petrol-fuel-speed.
The example of Trump’s tariffs on washing machines during his first term is instructive. Washing machine imports fell but the price of both washing machines and dryers, usually sold as a set, increased dramatically. US manufacturers took advantage of the higher foreign prices by raising theirs. However, the Us manufacturers did not win, since foreign makers like Samsung and LG opened factories in the US and American manufactures fell behind: “Industry spokespeople claim the Trump tariffs had “no sustained effect” on washing machine prices. But that’s only true because prices dropped when the tariffs expired. Anybody who bought a washer or dryer between February 2018 and February 2023 paid considerably more than they would have, absent the tariffs….A [Duke University]2019 study found the net annual cost to consumers for each new job created by the tariffs was about $815,000. That’s extraordinarily high. The average cost per job for subsidies such as state or local tax breaks meant to lure businesses typically ranges from $50,000 to $100,000.” See https://finance.yahoo.com/news/higher-prices-extra-jobs-lessons-from-trumps-washing-machine-tariffs-185047360.html. This article is consistent with many others I have seen.
Trump has consistently said that other countries are cheating us by the US having trade deficits with them. This is a bizarre statement. Trade is not cheating. Other countries sell us stuff that we like or need. For example, the reason Canada sells us a lot of aluminum is that Canada has cheap hydropower, which we do not and aluminum manufacturing requires a lot or electricity. We benefit and Canada benefits. Until Trump, this was not an issue with our northern neighbor.
Part of the problem with Trump’s fetishistic view of tariffs is his chaotic approach, as you noted. I think you underestimate its effect. He provides no certainty to any business willing to invest. Also, other countries are wise to his game. And does he have an end game. My guess is no. If he wants to reindustrialize America, we may be past that point, at least as he understands it. Does he want us to make sneakers and furniture instead of chips? Quien Sabe?
On the other hand, even though the number of workers in manufacturing has fallen we remain a manufacturing superpower. See these stats from a Brookings report: “China leads the world in terms of manufacturing output, with over $2.01 trillion in output (see Table 1). This is followed by the United States ($1.867 trillion), Japan ($1.063 trillion), Germany ($700 billion), and South Korea ($372 billion). Manufacturing constitutes 27 percent of China’s overall national output, which accounts for 20 percent of the world’s manufacturing output. In the United States, it represents 12 percent of the nation’s output and 18 percent of the world’s capacity. In Japan, manufacturing is 19 percent of the country’s national output and 10 percent of the world total. Overall, China, the United States, and Japan comprise 48 percent of the world’s manufacturing output.” Are we number 1? No. Do we use a lot of foreign inputs, yes. But we are still impressive. We also lead the world in a number of key indices (services, finance, IT, etc.). See also the summary of a Cato report , https://www.cato.org/blog/united-states-remains-manufacturing-powerhouse?gad_source=1
On Canada, you sort of imply that it because it is relatively small in population (39 million), its economy is too and that it would fold under US pressure. However, Canada’s GDP is $2.1 Trillion and it is the 10th largest economy in the world. Its GDP is larger than Mexico (with a population of about 139 million) and a GDP of $1.8 trillion, making Mexico the 12th largest. Both countries are puny compared to the US, but still formidable. These are 2023 figures–see https://www.worldometers.info/gdp/gdp-by-country/ . 2024 numbers are slightly different–see https://globalpeoservices.com/top-15-countries-by-gdp-in-2024/.
There is a larger issue here than tariffs alone in regard to Trump’s actions. As Paul Krugman has notes, Trump may be destroying the US’s international brand. Krugman ends a recent substack column by noting: “Still, Trump’s belief that America holds all the cards, that the rest of the world needs access to our markets but we don’t need them, is all wrong. We are rapidly losing the world’s trust, and part of the cost will be financial.” See https://paulkrugman.substack.com/p/teslafying-us-exports.
I just watched Secretary Rubio on Face the Nation and he was eloquent in defending the administration’s tariff proposals. I wish I felt it was as coherent as he made it sound. Some of it makes sense (reciprocating, changing the status quo) but other parts (Canada, for example) are just odd, at best.
After your recommendation, I watched the Rubio segment on Face the Nation. While he may/may believe what he says, I found him unpersuasive, given what the majority of economists say. See Jerome Powell’s comment today on the Fed’s view. See also, e.g., https://www.businessinsider.com/trump-tariffs-canada-mexico-trade-economy-krugman-summers-hanke-reich-2025-2 and https://tcf.org/content/commentary/economists-agree-trump-is-wrong-on-tariffs/.
Worldwide tariffs are not that high, except on certain goods. In 2022 the World Bank noted that “Tariffs imposed by European Union in 2022 are below:
The maximum rate of tariff in percentage on any product was 361.67 percent.
The simple average tariff across all products was 1.97 percent.
The trade weighted average tariff was 1.34 .
The total duty free imports in thousands of US dollars were 2,104,598,568.47 and duty free tariff line items share was 71.76 percent.”
Except in certain instances (I have no idea where that maximum tariff is!) the rates are pretty damn low. And Krugman has made the point that this is generally true for Canada in recent years (though it always was not so).
There is a crucial point emphasized by Paul Krugman: With some exceptions (China and sonme countries who we do not trade much with, e.g., Brazil) “if we look at who the United States trades with, it’s mainly with countries that have very low tariffs, just as we do.” see https://paulkrugman.substack.com/p/more-than-you-wanted-to-know-about. Note: I subscribe to his substack, so you may note be able to read the whole post. Of you want, I can send it separately.
So, a lot of Trump’s complaints about high tariffs are not true of our key trading partners (Canada, Mexico, the EU, Japan, etc.).
As I said, I am unsure things will work out as Rubio suggests. The same idea came up in Ezra Klein’s interview with Financial Times columnist Gillian Tett, () where she does a very good job of explaining how it all might work, but doesn’t feel very confident it will work.
I agree (of course) about the size/scope of tariffs; that’s the point, isn’t it? In a free trade environment, they should be low. Rather, I think it a tad hypocritical to say all the bad/worse/horrible things they do about tariffs when so many countries continue to use them. And there is the related point about quotas, taxes, and other non-tariff regulations which function just the same way. It was axiomatic during our days fighting the Cold War that the US let other countries have an advantage in trade, because having allies against the Soviet Union was more important. Same even for defense spending! That logic endured long past its relevance.
Yes, many countries use tariffs, but as I noted in my earlier post, in reality the vast majority of tariffs with out best trading partners (who are now see as literally enemies by Trump in some truly vile language) are generally low.
In a snarky substack column, Paul Krugman, who was awarded his Nobel Prize by work for work on international trade theory, briefly discusses Miran’s work–which is mentioned at length in the Ezra Klein interview with Tett, and says that:
“So yes, Stephen Miran, now the chairman of the Council of Economic advisers, himself wrote a white paper last fall about international finance that isn’t quite as crudely fallacious as Ross-Navarro. And this paper could be construed as lending some intellectual support to Trump’s tariff policy as a tool to force other countries to change their currency policies. This, presumably, is why Miran was hired. But there’s no reason to believe that Miran’s views (which are muddled, but never mind) are actually influencing policy. Surely Trump’s team is using analyses like Miran’s, as the old saying goes, the way a drunkard uses a lamppost — for support, not illumination….My point is that Trump believes many blatantly false things that suit his prejudices. Why imagine that he and his courtiers have sophisticated ideas and a deep strategy when it comes to international economics? On the surface, Trump’s trade policy looks stupid and destructive. Dig deeper, and you discover that this first impression was completely valid. Trying to pretend otherwise is just misinforming readers.” See https://paulkrugman.substack.com/p/the-emperors-new-philosophy.
As I read Tett, she wasn’t sure that there was any real coherence in Trump’s policies and in many respects even those Trumpists who really think a bit about tariffs are trying to square the circle. I agree with Krugman. And BTW, non-tariff regulations like VAT are not meant to hurt imported goods, since all goods both produced in a country and imported pay the VAT.
I think you disagree, but I think Trump is by his policies disintegrating America piece by piece and tariffs are one part of his non-plan.
Krugman’s collapse from Nobel laureate to partisan hack is really emblematic of the age. He just couldn’t help himself on inflation, because it meant criticizing Biden, who was all that stood between Trump and another term. Sad.
I find your last comment VERY interesting. I think we agree that Trump has a huge ego and wants to be remembered as “great” (not further defined). You said, “Trump is by his policies disintegrating America piece by piece and tariffs are one part of his non-plan.” So how does this play into his ego?
Well, one man’s hack is another man’s helper. Krugman has helped me understand economics better , which I used often in dealing with Russia in my courses at NIU. I used to argue that if you want Russia to collapse, keep Putin in power for another ten years, since, as a kleptocrat, he does not understand economics (though he has survived so far by understanding that he needs to trust a group of fairly smart economists who run the central bank, finance ministry, etc.). Burt, in the long run, Russia will fail.
Krugman has written on inflation under Biden. He admits in this piece that some of the inflation under Biden was caused by Biden’s plans, but other issues were more important (sorry for the long quotation and my cutting of paragraph breaks):
“President Biden enacted the American Rescue Plan soon after taking office. It was big — $1.9 trillion, which is a lot even in an economy as big as ours. And some economists, notably Larry Summers, warned that it would overstimulate the economy and be highly inflationary. Other economists, myself included, downplayed the risks. Large parts of the bill, like aid to state and local governments, wouldn’t do much to stimulate the economy right away; that money would be spent gradually. Also, historical experience seemed to show that even if the economy became overheated, this would lead to a relatively modest and temporary rise in inflation.
Obviously we were wrong to be complacent, and I have admitted that. Inflation quickly shot up to rates not seen in four decades: [chart is missing–I cannot copy it but it shows inflation peaked at about 10% inn July 2022 and dropping to 2.5% in Jan 2025]Alert readers will notice that this chart doesn’t use the ordinary Consumer Price Index. It uses the Harmonized Index of Consumer Prices, which is how European statistical agencies measure inflation, but is also available for the United States. I use that measure to facilitate international comparisons. But for 2021-22, it doesn’t matter what measure you use: inflation did, in fact, soar. Why? It would be foolish to deny that the Biden stimulus played some role in pumping up demand and hence feeding inflation. But there were other things happening too, largely disruptions associated with Covid and its aftermath. Consumer spending revived after the initial shock of the pandemic, but people spent their money differently from before. Notably, they became reluctant to consume services, which often involve in-person contact and the risk of infection. Instead, they bought physical stuff: kitchen equipment instead of restaurant meals, exercise equipment instead of going to the gym, and more. And it turned out that supply chains — the infrastructure that gets stuff to consumers — didn’t have the capacity to handle the sudden rise in demand for physical goods. For example, there was a period when container ships were steaming back and forth off the coast of California, waiting for a chance to unload. The New York Fed calculates an index of supply chain pressures, which spiked briefly during the worst of the pandemic (remember the toilet paper shortage?), subsided, then surged in 2021-22 — a surge that correlates closely with the surge in inflation….The good news was that the kinks in supply chains mostly got worked out in the second half of 2022, and inflation came down soon after, falling almost as fast as it had risen. One additional piece of evidence that supply disruptions played a key role in inflation is that the rise and fall of inflation was a global phenomenon. Europe didn’t have a Biden stimulus, but European inflation nonetheless followed more or less the same trajectory as U.S. inflation, just with a lag. In the end, inflation followed the script laid out by Rouse et al in mid-2021: a transitory rise in inflation caused by Covid-related disruptions, fading out as the economy adjusted. Why, then, did [Larry] Summers and others make such dire pronouncements in 2022, predicting that disinflation would require years of mass unemployment? Well, remember what I said about how companies don’t revise prices too often and look over their shoulders at competitors and suppliers each time they do adjust their prices. One consequence of this staggered price-setting, pointed out by Edmund Phelps in the late 1960s, is that inflation can become “entrenched” in the economy. If high inflation has persisted for some length of time, it will tend to persist. Why? Because every time a company changes its prices, it will usually mark them up both to catch up with inflation that has happened since its last price revision and to get ahead of the inflation it expects to happen before its next revision. So inflation becomes self-perpetuating, which is what happened in the 1970s….Indeed, high inflation didn’t persist; at the end of 2024 inflation was at most a fraction of a percentage point above the Fed’s target. But the public was still angry over high prices, and a significant number of voters believed Trump when he said he would bring grocery prices down on Day One of his presidency.” (https://paulkrugman.substack.com/p/inflation)
On the last point about Trump’s ego, this is actually a hard problem, as we used to say in intel. I would venture that Trump believes he is right and just, despite all evidence to the contrary. And this time, there are no guardrails or people in his administration manning guardrails to hold back his worst instincts. Just look at the comments almost every day from Secretary of Commerce Lutnick (BTW, do you even know the name of Trump’s Commerce Secretary in his first administration or any Commerce Secretary?). The Supreme Court ruling on Presidential power has certainly provided Trump his validation, at least in his own eyes. He honestly believes that he can do what he wants and the Supreme Court will validate his actions.
Trump just assumes that all will be well, that he is the universal genius and the smartest guy in the room; hasn’t he said that many times? He does not think he is harming America (despite the continuing chaos in American science with the problems at NIH and the attacks on DEI which have led, inter alia, to DoD dismantling any reference to American service people who are not white or straight, the firing of the only black man and the only woman on the Joint Chiefs, Doge running amuck everywhere, etc.).
I think he believes and hopes all will be well–notice how he absolutely loves to sign executive orders with a Sharpie dismantling the alleged liberal state and show them to the press. He is proud of his ability to break things he does not like. I believe, as do many others, that he certainly does not think about secondary or tertiary results of his actions. In addition, as an example of personalist power, Putin has provided a model to Trump. Just look at the surrender of a multi-billion dollar law firm like Paul Weiss or the surrender of Columbia University. Trump revels in this.
I know we disagree onTrump. I should not that that most of his worst tariffs have yet to come into existence–he has said they will in April. Then the reality will set in, though it may take months to be fully realized.
I used to brief Gordon Sullivan, Army CoS, and his favorite expression was “hope is not a method.” But that is where we are.
Don’t get me wrong. Krugman was a brilliant economist, and the award well-deserved. But he sold out to defend the Biden admin on inflation in a shameless fashion, writing again and again it was transitory, the federal spending wasn’t a problem, etc. He finally (as you noted) admitted he was wrong, but either he forgot everything he knew about economics (not likely), or he got deranged by Trump and became a simple (and wrong) partisan.
Thanks for explaining your statement about Trump. So (if I may) it’s not that (in your opinion) Trump wants to destroy everything, but rather he thinks he is just destroying bad things and better things will (hopefully, to borrow the General’s comment) replace them. I just couldn’t buy the idea Trump thinks he is Shiva.
My only comment here is that inflation actually was transitory. Down from 10% to 2.5%. But, as Krugman correctly, says the public saw high prices and were angry with the Democrats. I will note that public opinion polls a few months after the election showed that the US population thought that inflation was better, and nothing had yet changed, andTrump was not yet in office. Go figure…..
I do agree with your last statement about Trump. While the truly awful destruction (see the changes in social security sign-up will be for the 6 million people retiring),may be incidental to whatever is in his head as he arises each morning, he likely thinks the eventual outcome will vindicate him. I also think he and Musk have little empathy for anyone harmed by their actions. What Trump believes and what is currently happening and what may happen may not end the way he envisioned.
The “transitory” comments fail one of two ways. All inflation is transitory, or else the economy fails. So that is a truism that no one claiming economic knowledge should make. Or it was transitory due to some cause, of which Biden’s spending (and remember, he wanted twice what he got) was important. Voters heard doublespeak and acted accordingly.
Your second comment bears reconsideration. The SS changes you mention have been hyped beyond belief. Down here in expat land, people are losing their minds, talking of driving to the border to sign up for SS (or make changes) in Texas. The need to show up in person only affects people who cannot access the SS app on a computer or smartphone. They used to be able to phone in, and that option is being eliminated. Another example where media hype extends well beyond reality.
Well, I think you are both right and wrong, I would argue.
First, you are likely correct that if your expat friends have social security already, they probably will be fine. If they need to make changes, that could be up in the air, because Doge and the Trump administration are making changes without really understanding or caring about the results.
Second, the panic is real for new enrollees. Telling the likely 6 million Americans who will try to get their social security this year by phone (and have hours of wait time from a reduced staff) that they have to go into an office, which may be hours away or use a computer, which they may not have or not use well is likely a prescription for making people’s lives difficult in a system that worked reasonably well until now (even while Social Security was apparently understaffed under both Biden’s and Trump’s first administration, the planned Doge cuts will only make matters worse).
Here is a quote from an Axios story citing Lelend Dudek, the Acting Social Security Commissioner (the last comment by Dudek in the piece is a humdinger (“in the past Social Security had been too “thoughtful” in considering beneficiaries before making changes,” as though worrying about your aging beneficiaries is wrong):
“Some of the most vulnerable Americans — including people who are hospitalized, kids in foster homes and those living in remote areas — will face more hurdles applying for disability benefits, according to one advocate who spoke with Axios and was at the meeting.
Some beneficiaries could effectively be blocked from receiving benefits, per an internal Social Security memo, viewed last week by Axios.
Driving the news: Acting commissioner Leland Dudek said the changes in question would usually take two years to implement, but will be made in two weeks instead, the two sources said, on condition of anonymity due to fears of retaliation.
Dudek also said the changes, happening so fast and with little public understanding, will create opportunities for scammers, one of the sources said.
Dudek acknowledged the policy could increase fraud risks for beneficiaries, according to one attendee. He said in the past Social Security had been too “thoughtful” in considering beneficiaries before making changes.” See https://www.axios.com/2025/03/24/social-security-cuts-doge.
For more on the current and likely future mess at Social Security see https://www.washingtonpost.com/politics/2025/03/25/social-security-phones-doge-cuts/ and https://www.washingtonpost.com/business/2025/03/24/social-security-fraud-doge-cuts-dead/ and the Wall Street Journal at https://www.wsj.com/politics/policy/social-security-cuts-doge-customer-service-91f96e00?mod=Searchresults_pos9&page=1.
Of the six million who apply for SS yearly, we are arguing over the ones who don’t have a smart phone, don’t have a computer, don’t have a friend/care-giver with the same, don’t have access to a public library, and can’t arrange to travel to a local SS office. That’s a small number. Many of the new rules are designed to target two of the biggest sources of fraud in SS: disability claims and phone approvals. How do they even “confirm” SS over a phone? I don’t believe there is great fraud in SS, or anything like what Musk claims, but since it is smaller than that, what . . . we ignore it?
I remember when they introduced direct deposit for federal pay. We had long-time employees who refused to comply, or said they couldn’t. It worked, and they did.
One of the tragically comical parts of the Times’ coverage of this issue was the recognition that SS phone lines are back-logged now because so many people are calling and asking “what’s going to happen with my SS?” So they’re asking questions which can’t ever be answered by an advice line, today, tomorrow, or yesterday (under the previous administration).
I don’t know whether I am angrier at the media hyping this issue, or sadder at the people who don’t know any better.
It clearly is not media hype. Serious events are taking place and it is not clear that result will actually help people.
You and I (and your fellow expats) can use computers, smart phones and ID.me; perhaps we are the elites that Vance deplores! However, but others have lots of problems with access.
Just look at the details in this Washington Post story: See https://www.washingtonpost.com/politics/2025/03/25/social-security-phones-doge-cuts/. The problem is that no one really knows what will happen with the Doge cuts, the dope (Dudek) who is temporarily running the system, which was overworked before, and the cuts to both offices and phone lines. The story notes that whatever positive changes done under Biden (a better phone system, for example) are being undone.
You say: “How do they even “confirm” SS over a phone? I don’t believe there is great fraud in SS, or anything like what Musk claims, but since it is smaller than that, what . . . we ignore it?” The SS system uses a knowledge based system to authenticate people over the phone, the same way a bank does. Its there fraud? Yes. Dudek has stated that “Social Security is losing over $100 million a year to direct-deposit fraud” Not trivial, but relatively small in a 1.6 trillion dollar system.
There was an inspector general with a 500-person staff to investigate and make changes. There are also mistakes, like giving people too much money, and the IG worked on that. According to the IG, “From FYs 2015 through 2022, SSA estimates it made nearly $72 billion in improper payments, most of which were overpayments. While this is less than 1 percent of the total benefits paid during that period, at the end of FY 2023, SSA had an uncollected overpayment balance of $23 billion.” This means that the IG recovered 2/3 of the overpayments, etc. See https://oig.ssa.gov/news-releases/2024-08-19-ig-reports-nearly-72-billion-improperly-paid-recommended-improvements-go-unimplemented/. This release also has a link to the full report.
Note that the Biden Administration was criticized in the title of the report press release: “Recommended Improvements Go Unimplemented.” See also https://www.washingtonpost.com/business/2025/03/24/social-security-fraud-doge-cuts-dead/ which makes a strong case that fraud is firmly looked and the system tries to deal with it, but that actual fraud is relatively small, given the size of the system; but it is not/not ignored.
BTW, Trump fired the acting inspector general. Doge is ls firing a lot of staff and closing SS offices. So, the system will be less resilient without more money to fix things, which the Trump Administration is certainly not inclined to do.
Adding the word clearly does not make for an argument.
I subscribe to the Post and read its coverage of this issue. It was exactly what I was thinking of when I called it hype. Because they can find someone who doesn’t have the access means . . . what? There are always such people. No one has provided any estimate of the size of the problem.
You added that “the problem is that no one really knows what will happen. . . ” Exactly. So why not scare the living daylights out of people and get them to flood SS hotlines, social media, message boards, and everywhere else with “what if?” questions. That’s helpful, not.
I’m going to cover this in the future, but two glaring problems come up in your response. One is the ‘the fraud/waste/abuse (fwa) is only x%’ idea. Yes, it’s only a few billion here and there. That is precisely how we got into this mess, thinking everything is relative. The other problem is the ‘there are government elements which exist to identify and address these instances of fwa.’ Also true, and why haven’t they fixed it? I am not blaming the elements; sometimes all they can do is identify the problem. But the mess is large now, and the clean-up has to start now.
If you read the soc sec summary, it got a lot of money back. No business has 0% of fraud or loss, so why expect the govt to have no problems? . The issue is that there are agencies within departments that are working on this, as well as the FBI and Us attorneys. If you think Trump or Musk are really serious about finding waste, fraud, and abuse, I have a bridge to sell you
People are scared because of what the characters running Social Security are telling them or announcing every other day. The media are not making this up. Soc sec stats show that people with no high school degree or has only a hs degree depend on soc sec for more than 60% of their income. So perturbations in the system scare people. And soc security leaders are taking marching orders from Dogers, who clearly do not understand the workings of the system, or what they think Trump wants.