The version of the “Big Beautiful Budget Bill” enacted by the House will encounter more modification by conservative senators before it becomes law. I have no confidence that they could pass one that would fiscally correct the unsustainable debt trajectory of the U.S. Given his support of the House bill, President Donald Trump doesn’t even intend to try. He thinks that he has an ace in the hole, however, that he is playing that will suffice as a solution to the problem … tariffs. He has alluded to the hundreds and hundreds of billions in tariff revenue that he intends to collect from the world that will supplement U.S. tax revenue enough to flatten the trajectory of our rising debt. That is his “trump card.” That is how he intends to solve our budget crisis. The plan appears to be to allow Americans to live beyond the means produced by our gross domestic product while shaking down the rest of the world for tariff revenue to sustain it all.

I have not seen any credible evidence that this is going to work, but it is the “Hail Mary” pass being thrown and we are going to find out. He has put the ball up in the air and there will be months that could become years before we see if the pass connects and scores. The House bill was a regressive same-old,same-old continue to live beyond our means, borrowing from our children’s future reprint. It used gimmicks, such as not making tax cuts permanent, to perpetrate the intended illusion of understating how many trillions of dollars it will add to the federal debt.

I see unintended consequences in tariffs, one of which is, that when countries protect industries with tariffs, and those domestic sectors and companies are shielded from competition, they lose their technological and competitive edge that they may have once had. Competition sharpens edges and tariffs dull them. We almost lost the U.S. auto industry in the 1970s and 1980s due to its lack of innovation and inefficiencies. Lee Iacocca was challenged to save Chrysler. The government bailed them out.

I have owned a lot of different vehicles over the course of my life and they were all American brands … Ford, Chevy, Chrysler, Dodge and International pick-ups. The idea of buying a foreign-make vehicle just never appealed to me, even when they were much better quality. We had a Chevelle when we got married (1973) and it was like it was purposefully engineered to self-destruct when reaching 90,000 miles. We still had to roll the windows up and down manually back then and the window crank fell off (the good old days), the rear-view mirror fell off the windshield and the knobs would all detach before the odometer rolled over. This is when Toyotas started unloading off ships on the west coast for the good reason that they were superior quality to our domestic brands.

I had friends who bought Toyotas and they were just broken in at 200,000 miles and got better gas mileage when gas prices were a big issue. This competition almost collapsed the U.S. auto industry, and they had to rise to the challenge and make comparable quality autos to survive.

The Federal government did bail out our automakers using loans, not tariffs, as they are doing today. Another thing that U.S. auto brands did to become competitive was to make their parts and assemble their vehicles wherever they could find the lowest cost production. I think that my Dodge pickup or components of it crossed back and forth across the Canadian border a few times before reaching my driveway and many of the parts likely came from Mexico or vice-versa.

Dodge is now owned by Stellantis, headquartered in the Netherlands, so has pretty much become a mongrel breed of vehicle with American decals. I think that Trump’s tariffs are more likely to break Chrysler than resurrect it. We should thank Japanese automakers for forcing ours to make high quality vehicles. My last Dodge pickup reached 200,000 miles and still had value. This one crossed 100,000 on the odometer and the knobs have not fallen off. Today the U.S. auto-industry may need to be saved again, and it doesn’t look like tariffs will do that. Quite the opposite.

The U.S. auto industry is under a new, just as threatening challenge of having to compete as global automakers today. Our domestic auto industry is not the leader in low-cost production, innovation and technology. It is not even making autos that most of the world wants and cannot begin to compete on price. We have a domestic auto industry that is still primarily producing combustion engines. I am not a fan of electric vehicles (EVs) so am part of the U.S. market complexity. The U.S. industry has lost billions by building EV battery and auto plants and then rebuilding them to make engines and hybrids before the new EV plants even became operational. The federal government provides incentives and then takes them away. The charging infrastructure is not there and the grid is inadequate to provide the power. Toyota remains the global tech leader and was best attuned to the market focusing on hybrids. Right now, you can buy a very functional, adequate EV in China made by Chevy (in China), Toyota or BYD there for a little over $15,000. These are vehicles that Americans can’t buy. By the time they are shipped here with a 100% tariff they are $60,000. BYD sales are exploding in Europe, Asia and Africa, places where people cannot afford U.S. autos at U.S. prices. BYD sales beat Tesla’s in Europe last month. Tesla is still trying to decide whether it is a car company or something else. The result will be that Americans will pay more than anyone else in the world for vehicles with U.S. automakers being punished with tariffs for any portion of their production crossing the border with Canada and Mexico. Any new U.S. jobs created here will be some of the most expensive in the world. If you want cost-effectiveness, this is the opposite of that. Maybe the U.S. auto industry can survive behind these tariffs, but more likely the tariffs will allow them to linger a while in purgatory before they kill them. Americans are going to pay a very high price because of it.