Is Donald Trump a Chicken?

Posted on February 12, 2011 by Brian Reilly in Articles

Donald J. Trump showed up at CPAC (Conservative Political Action Conference) for a thirteen minute speech. Trump is again flirting with a run for president, but no announcement was made. I presume we’ll have to wait till after the commercial break — which ends in this summer. Trump says he’ll announce if he is or isn’t running in June.

In his speech, Trump proclaimed that he is pro-life and against gun control and would not raise taxes, except on those countries who are “screwing us”. One of those countries “screwing us” is China. Trump wants to slap a 25% tax or tariff on everything from China to force them to play fair with their currency. The United States can’t compete with cost of Chinese products.

Some background:

After the founding of the United States, tariffs were the main means of raising government revenue from 1790 until 1913. There was no federal income tax until 1913. It was President Woodrow Wilson who signed the Revenue Tariff Act of 1913 (also called the Underwood Tariff) which lowered tariffs dramatically. The new progressive income tax eventually exceeded the revenue that the federal government was making on tariffs.

So what does Donald Trump, tariffs, and chicken have to do with each other?

Remember the Chicken Tax?

In 1963 Lyndon Johnson had just become president after the assassination of John F. Kennedy. At the time the United States was a huge exporter of frozen chickens to Europe. Several countries in Europe put a tariff on chickens imported from America. In retaliation, President Lyndon Johnson put a 25% tax on potato starch, dextrin, brandy, and light trucks. The tax on light trucks was a favor to the UAW (United Auto Workers) because Volkswagen was a competitor of Detroit. The 1964 presidential election was approaching and Johnson wanted the UAW to call off a strike and support civil rights legislation. The Chicken Tax continues to this day to insulate American auto manufacturers from competition in the light-trucks market.

Is Donald Trump’s proposal of a 25% tax on Chinese products just a Chicken Tax?

Maybe not.

It may have legs.

Or wings.

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