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Outside the Box: CEOs pandering to Trump risks dangerous ‘caudillo capitalism’

Assessing Donald Trump’s proposed economic policies in a recent article for the Weekly Standard magazine, economist Irwin Stelzer defended protectionism, but criticized displays of what he called the “Caudillo Capitalism” often seen in authoritarian regimes.

Protectionism has always been part of capitalist theory and practice. Adam Smith, arguably the founder of free trade, clearly defended retaliation against countries that imposed tariffs. Stelzer quotes Smith on lifting tariffs after a period of successfully imposing them: “The recovery of a great foreign market will generally more than compensate the transitory inconvenience of paying dearer during a short time for some sorts of goods.

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