I’m Pumped That Tariffs Will Bring Our Blue Collar Manufacturing Jobs Back From Europe

"Luxembourg shock" is finally over!

Above: A typical European home. (photo by Henrique Ferrera)

“We need tariffs because our blue collar manufacturing jobs are going overseas — Rust Belt towns have been hollowed out!” That’s the argument you’ve heard for decades; I remember hearing it in the ‘90s from Ross Perot, the third party presidential candidate/most impression-ready person in the history of American politics. Trump has made righting this alleged wrong the centerpiece of his economic policy, and is currently masterminding a global, multifaceted tariff negotiation session that reminds me of Bart Simpson playing three simultaneous games of chess:

This week, the White House and European Commission announced an agreement that sets tariffs for most European goods coming into the US at 15 percent. Many are trumpeting the pact as “the least bad outcome” — seems exciting! The deal will mean new costs for American consumers, with Yale Budget Labs estimating that all 2025 tariffs will boost prices by 1.8 percent, the equivalent a $2,400 hit per household. And because import tariffs are paid by Americans, the policy amounts to a tax increase that impacts everyone.

But those costs need to be weighed against the benefits. Specifically: Blue collar Americans will no longer have their wages undercut by desperate peasants from Denmark and Monaco who are willing to work for dirt cheap. No longer will once-proud American workers at, say, a tire factory or a home goods manufacturing plant be told “We’re moving the plant to Lichtenstein where labor costs are low.” The era of so-called “Luxembourg shock” is over! And soon, all the blue collar jobs that we lost to Europe in the past decades — those millions upon millions of factory jobs — will be back on-shore.

You can’t deny that American workers have struggled for decades to compete with low-cost labor in places like Paris and San Marino. Things are just different in Europe: Their castles are crumbling, their bullet trains are in disrepair, and many of their noble titles barely even mean anything anymore. They’ll work for bottom-rung wages because they have to — it’s the only way they can put roast duck, a glass of port, and a buttery brioche with a side of camembert on their table. There are parts of Europe that don’t even have air conditioning — you can see how people living in such primitive conditions might agree to a wage that no American would accept.

But if you go to Barcelona or Marseille, the harbor is full of yachts because low-skill factory jobs have forged a class of nouveau-riche Europeans. It seems like every Baron and Earl you meet these days in Europe assembles iPhones or sews shoes for Nike — you can’t swing a Stradivarius in Europe without hitting a factory that used to be somewhere like Scranton or Flynt. And greedy billionaires are more than happy to exploit Europeans’ desperate situation: They arrive in Europe and see ancient buildings and art that hasn’t been updated since the Renaissance, so of course they think “these people will work for nothing!” Which is why we’ve seen a mass exodus of American jobs to low-wage havens like Zurich and Milan.

So: Thanks to Trump, all the textiles jobs that fled to Brussels, all the packaging jobs that went to Stockholm, and the heavy machinery workshops that currently dot the Grand Canal in Venice will soon be coming home. You really have to wonder why no president before Trump put the screws to Europe so that they cough up the manufacturing jobs that they stole. I hate to sound like a conspiracy theorist, but what compelled policy makers to keep European tariffs low even as the irresistible lure of dirt cheap European labor was hollowing out the Midwest?

Some have noted that the tariffs will hurt American workers in fields like auto and aircraft manufacturing, because Trump has put tariffs on inputs like steel and aluminum, but Europe hasn’t, so European plants operate at lower costs. Companies like Volkswagen and Airbus might shift their US plants back to Europe; Volkswagen has already hinted that that’s being considered. But I’m sure that Trump thought of that, because he’s the master of the deal, and we really need to take a step back and give him room to work his magic.

And, again: You need to weigh the bad against the good, and consider the losses in auto and aircraft manufacturing against the scores of low-skill manufacturing jobs that will be coming back from Europe. We’ve gotten used to “Made in Iceland” stamps being on everything we buy, but it doesn’t have to be that way. Whatever the negative impacts of this policy, they have to be considered alongside all the low-wage jobs that will return from the continent.

And some might say: “What the fuck do we even imagine that we’re doing here? Like: What is even the theory behind this? We’ve had decades of low-friction trade with Europe, it’s helped make both parties historically rich, and there aren’t size and wealth disparities that could cause disruptions, so what the fuck is even supposedly the problem? Europe doesn’t cheat the way China does, they don’t have piss-poor environmental and labor standards like South Asia, and they don’t have export-oriented policies that are arguably anti-competitive the way Japan and South Korea once did. So why are we putting the screws to our most valuable trading partner? And why are we doing this when that partner is also our main strategic and military ally, so there’s no conceivable universe in which we’d prefer that they be weaker? All we’re doing is making shit more expensive, which is the opposite of what I thought we were supposed to be doing, this is basically a regressive tax hike that’s negative sum to both parties. So, I ask again: What in the seven layers of fuck do we even imagine that we’re doing?”

But to that I say: When Levis relocates a plant from Austria, and you score yourself a sweet job fashioning rivets on to jeans eight hours a day, I think you’ll understand!

---