Ot isn't about the capital allocation of individuals persay. It's how the whole economy shifts towards producing ressource A instead of of ressource B.

Let's say it used to be more profitable to produce ressource A instead of ressource B but the tariffs changed that. They would essential be producing something that is more profitable only because the state influenced in that way. Not because it is truly more profitable (and therefore better for society as a whole) to produce it.

In the long run this is what I see. Americans producing more cars instead of doing something else because the state didn't want Chinese cars even tho they were same quality at a lower price.

(This specific example is pulled out of my ass but this is the principal..)