Yes, for capitalism to exist, there must be both a consumer class, and a labor class, below the capitalist class. The cost of labor in highly industrialized countries is one of the largest driving factors behind the development of this infrastructure. We need to make sure we can import from places where the cost of labor is low enough, for the long term. Even China, and India, are starting to off-sure labor. The problem is that this, along with population growth, can’t be perpetual. Which is the inherent problem underlining capitalism as a permanent economic system.

Yeah, the, misguided, idea is that the increase in price from imports will drive domestic production, of those things, as the high prices reduce demand, and cut into profit margins. This used to be something that was a sensible assumption of what would happen. However the contemporary world has far too much infrastructure for tariffs to truly work like that any longer. It will, usually, be cheaper to increase the costs for the tariffs, than to restructure back to domestic production.