But what is the goal of a tariff regime? The goal is simple—we already covered it.

At the level of the nation as firm, trade policy works in two ways. First, the nation turns a profit, which is good for its international position—and, more important, an exercise that helps keep the whole nation in efficient, profitable shape. Second, the nation preserves and enhances its human capital, its physical capital, and its intellectual capital, by demanding labor from its citizens. Value of the assets.

China sends huge quantities of products to America and in return receives pieces of green paper. The pieces of green paper are not the primary benefit to China. In fact, if America disappeared into the sea, the Chinese government might rationally choose to simulate America—producing the same amount of stuff, dumping it into the Pacific, and paying the factories with the same pieces of paper. Why? Because its assets are the Chinese people, and working hard technology is good for the Chinese people.

Just as exercise is good for a person, the exercise of production is good for people, for teams, and for societies. Especially in the age of AI, the primary function of the state will be the conservation and production of labor demand. When humans do not need to work, they need to be made to work—on tasks which fit their skills and aptitudes. Contrary to 20thcentury dogma, skills and aptitudes are not infinitely adjustable.

The ultimate tariff is simply the requirement that goods be made by hand, by humans. In this future America, when we buy clothes, we have to buy them on Etsy—and Etsy’s rules are enforced by the FBI. Every time they capture a floating brick of Temu shirts, dropped by some fleeing speedboat, they display it on a card table for the local news:

“These Chinese junk clothes were trying to take American housewives’ businesses away. Now, Sergeant Hernandez will set them on fire. Look how well they burn—that’s pure polyester. Just the fabric, without a historical-clothing tag, would get you five years for artificial fiber, aggravated. Imagine if we still used that stuff! Why, the shepherd could not afford his bread and cheese, the cotton-picker his energy drink… everywhere, the economic fabric would collapse. It’d be like the late 20th century.”