To listen to Donald Trump, tariffs are an elixir for whatever ails you. They raise revenue. They spur domestic production. They stick it to foreigners. They’ll make America great again.

There’s only one thing wrong with this Trumpian view. It’s completely at odds with reality.

In 2019, the International Monetary Fund produced a working paper titled “Macroeconomic Consequences of Tariffs.” The authors examined annual data from 151 countries from 1963-2014.

Here’s what they found.

“Our results suggest that tariff increases have an adverse impact on output and productivity; these effects are economically and statistically significant. They are magnified when tariffs are used during expansions, for advanced economies, and when tariffs go up. We also find that tariff increases lead to more unemployment and higher inequality, further adding to the deadweight losses of tariffs. Tariffs have only small effects on the trade balance though, in part because they induce offsetting exchange rate appreciations. Finally, protectionism also leads to a decline in consumption; this, together with our other findings, suggests that tariffs are bad for welfare.

“All this seems eminently sensible and bolsters the arguments that mainstream economists make against tariffs; our results can be regarded as strong empirical evidence for the benefits of liberal trade. And given the current global context, we take special note of the negative consequences when advanced economies increase tariffs during cyclical upturns.”

According to the authors, these results confirm what “modern economics began over two hundred years ago … so it is worrying that the profession has been unable to persuade the public of the merits of free trade.”

Why is the public unpersuaded? The authors wonder if the “public’s mild views on protectionism stem from the fact that most economic analysis of protectionism is theoretical, microeconomic or dated?”

It would not be surprising if all the above were true since today’s public has little experience with tariffs. Although tariffs were a prime source of government income back in the days of President William McKinley, they were thoroughly discredited after the Smoot-Hawley tariffs of 1930 accelerated the Great Depression.

If Trump follows through on his threatened tariffs, the ill effects will become all too real and not at all dated. The price of tariffed goods will go up adding to inflation. Every extra dollar Americans spend on cars fully or partially made in Canada or Mexico will be a dollar they won’t be able to spend elsewhere. Same goes for Americans buying Canadian oil and lumber. Same goes for well … you get the idea.

When tariffs are few and far between, the consequences are largely invisible. The Trump and Biden tariffs on imported steel raised the price of washing machines with minimal side effects. That will not be the case if tariffs are introduced economy-wide.

As economist Adam Smith recognized in 1776, tariffs are economic self-harm. Tariffs turn industry “away from a more to a less advantageous employment and the exchangeable value of its annual produce instead of being increased must necessarily be diminished by every such regulation.”

Jeffrey Scharf welcomes your comments. Contact him at jeffreyrscharf@gmail.com.