If there’s one thing supporters and opponents of President Donald Trump’s tariffs should agree on, it’s the need to unchain prosperity at home while international trade is in flux. That means renewing the president’s first-term tax cuts, for a start, but it also calls for sweeping regulatory reform—a DOGE-like approach to slice the red tape entangling business at home.

Trump is attempting little less than a revolution in the global economy by reasserting American economic independence no matter the risks or pain. He sees trade deficits as inherently bad—and America’s deficit in goods traded with the world totaled $1.2 trillion last year.

When Americans buy foreign products, some of the dollars they spend cycle back home, as foreigners use the currency to acquire American companies (“foreign direct investment”) or invest in U.S. stocks, government debt and other securities (“foreign portfolio investment”). Trump wants Americans to buy American-made goods, however, which will keep more of the dollars in this country—they won’t go into foreign banks’ reserves, for example.

If Americans start buying from domestic manufacturers, the first thing their dollars will do is encourage more production at home, as manufacturers plow profits into building more factories and hiring more workers to raise output and meet the growing demand.

The president sees this as all upside: Instead of trading dollars for stuff made elsewhere, we’ll keep the dollars here, make the goods ourselves, and more citizens will get hired to produce them—especially in the Rust Belt states pivotal to Trump’s election victories.

The downside will appear, though, if domestic production can’t make up for the loss of foreign goods. If our manufacturers are less efficient than the foreign firms they have to replace, Americans will be left paying higher prices and getting less of what they want. Even if domestic producers are up to the task, they can’t build factories overnight, although the suddenness of the tariffs gives them the utmost incentive to start right away.

Stock prices, by contrast, can respond instantly, and have—by tanking.

Market expectations have been blown to bits: Trump isn’t just reforming international trade, he’s wrecking the system.

He could be bluffing—maybe he just wants maximum leverage over other nations for negotiations on everything from trade barriers to immigration to global security. But if Trump stays the course, he’ll either create a radically new economy—one more akin to that of the 19^th century than the globalized conditions we’ve become used to—or he’ll give new meaning to “American carnage.”

Yet even those who fear the worst, as free-market advocates do, should make the best of the situation by joining forces with Trump on the next phase of his agenda. Trump’s plan depends, after all, on the competitiveness of domestic producers—they have to be able to boost output quickly, which they can’t do when strangled by red tape.

And if price shocks result from tariffs reducing the overall supply of goods, consumers will need whatever tax relief they can get to offset higher costs.

Free-market advocates would rather get rid of the tariffs, but while they fight the administration on that front, they should cooperate with it to cut taxes and regulations—which libertarians and market conservatives wish to do under any circumstance, and in this case coincides with what Trump needs.  

Critics consider tariffs a tax on Americans, as foreign producers pass the higher costs of selling their goods on to us. Yet there are limits to what consumers can and will pay, and raising prices means selling fewer goods and so garnering less profit—or else cutting profits to keep prices down to sustain market share.

Those costs—reduced profits—come at the expense of foreign capital, not American consumers.

But whoever winds up paying for the tariffs, putting more money in consumers’ pockets by lowering other taxes is the smart thing to do. And it dovetails with DOGE’s mission of making government cheaper and leaner.

From an orthodox free-market perspective, the less benefit there is from foreign trade, the more imperative it becomes to lower taxes and promote entrepreneurship at home. For an economic nationalist like Trump, ramping up domestic production requires not only slapping tariffs on foreign goods but making sure consumers have ample cash to spend on American products—especially if prices are initially higher.

Tax cuts give them that money, and regulatory relief quickens the pace for domestic production to replace lost foreign trade, pulling prices back down.

Whether a more robust domestic economy is needed to mitigate the damage inflicted by tariffs, as free-market conservatives say, or to take the place of the global economy itself, as national conservatives say, Republicans should renew Trump’s tax cuts and make America’s business environment great again.