Probably everyone by now has seen that Nintendo has delayed the Switch 2 pre-orders in light of the new tariffs introduced by the Trump Administration. People such as one of my favorite game-related YouTubers, VG Esoterica, have done a great job covering the topic.

Everyone is talking about how they will now have to pay more to get the latest and greatest video game system. That sucks, right?! But one thing I haven't heard even a single person explain is: why the tariffs? Surely it's not some random and malevolent plot to just make things more expensive out of pure spite, is it?

Thankfully, I spent over a decade avidly studying the boring subject of economics so you don't have to!

I was brought up into the economic thought process of pure liberalism-- schools like Keynesianism, then Monetarism, then later the Austrian way of thinking. All three of those schools more or less agree that tariffs are bad. Why? Well, because if two parties are willing to make a voluntary exchange, then by definition that exchange must benefit both sides, lest why would they agree to the exchange in the first place?

Thus, wealth is created! Introducing a tariff just throws gum in the works and prevents people from generating wealth and thereby raising the standard of living. On paper and in the abstract, that makes sense! Unfortunately, when you get into the real world that model winds up being way too simplistic.

There is a competing school of economic thought called Protectionism. Under that line of thinking, it is recognized that trade imbalances occur between nations: some economies wind up as producing economies, while others wind up as consuming economies. That's exactly what's occurred with the United States in relation to other nations such as China, with whom the US is perpetually setting new all-time trade deficit records.

I've watched how, just in my lifetime, liberalism-- as the dominant economic way of thinking-- has directly resulted in the middle class in the United States getting pretty much completely erased as virtually the entire manufacturing core has been wiped out by corporations closing all of the factories and shipping all of the middle class jobs overseas. Hardly anyone in this country can even afford groceries or housing or anything else for that matter because the only jobs left for traditionally working class people are in the poorly paid service sector!

An entire class of people have been left behind by the globalism / liberalism paradigm. I think it's very sad.

This has also created national security risks, as all of the expertise in making so many things has "brain drained" out of the country, along with all of the tooling and capital machinery. Additionally, many of these liberal "trade deals" have been horrible for the US worker, as they were negotiated in bad faith to further enrich the wealthy.

The aim of Protectionism is to reverse those trends.

As an economic way of thinking, Protectionism has a long and rich history going back centuries, even within the United States itself. It's not new by any stretch. In fact, tariffs are widely used all around the world today by other countries, against the US. What Trump is attempting to do is create a renaissance in manufacturing within the United States, and also use the tariffs as a bludgeon via which to negotiate trade deals more favorable to the middle class.

For me personally, I have absolutely no clue whether this new wave of Protectionist economic policy in the United States will have its desired effect: the idea is that the country will be able to politically endure short-run pain in the form of a slumping stock market and higher consumer prices, in exchange for a mid-to-long-term economic renaissance for the middle class, if the plan works.

The old model failed-- so I'm willing to try something new for awhile and see how it goes.

The risk is that we're so far gone as a country economically, so far into debt, with the working class so impoverished, that a crushing depression could occur, causing an out-and-out "rebellion", either figuratively or literally, to happen-- flushing out the current administration, and re-introducing economic liberalism with the next one in a desperate attempt to right the flagging ship, and return to the imbalanced-but-somewhat-stable status quo of the past forty-odd years.

The only reason I bring this all up is to offer some badly missing context and perspective, which I'm not seeing from anyone else. Yes, you might have to pay a little more to buy a Nintendo Switch 2 in 2025. Yes, that qualifies as short-term pain, and pain sucks. But the missing part of that equation why these policies are being enacted-- it's not random; there is a method to the madness.