A discussion about tariffs

Guard Dad

Administrator
Staff member
I think most of us here would agree that there has been some pain from the tariffs Trump imposed. And most of us probably think we've been getting a raw deal from some of our trading partners.

I know some about tariffs, and I've also studied some on the dangers of protectionism.

So my question is; what are our options? If we impose tariffs on them, it can hurt our industries as it has thus far. I suspect Trump believes he will get eventual concessions from other countries that will make the current pain worthwhile. But will he? Will his gamble eventually pay off?

What other means do we have to level the playing field with our trading partners?
 
I think most of us here would agree that there has been some pain from the tariffs Trump imposed. And most of us probably think we've been getting a raw deal from some of our trading partners.

I know some about tariffs, and I've also studied some on the dangers of protectionism.

So my question is; what are our options? If we impose tariffs on them, it can hurt our industries as it has thus far. I suspect Trump believes he will get eventual concessions from other countries that will make the current pain worthwhile. But will he? Will his gamble eventually pay off?

What other means do we have to level the playing field with our trading partners?
Good faith negotiation. The WTO. Practicing what we preach.

Don't forget that the EU offered Trump completely unfettered trade, no tariffs and no subsidies, and he turned them down. That would have been an offer, genuinely proffered or not, to jump on to make our point. The problem is it would expose our own trade manipulation, and Trump know that. We learned in arms negotiations that trust but verify can be a successful technique when we can find a partner who understands that we have a mutual interest.

Tariffs are a strange weapon. They are aimed at our so called antagonists, but land squarely on domestic consumers. A rising tide lifts all boats. Even if our trading partners initially benefit more than we do, we all benefit, and it doesn't take long for their own economy to catch up with trading partners, and their growing consumer base becomes a vast market for our goods also. We shouldn't get hung up on legacy industries and ignore our strong points. We shouldn't look at products and ignore services or currency exchanges in the great circle. Trade is called a two way street, but it is really a network where dollars spent in one place can come back through other parties. Protectionists take a very narrow myopic view of the process and ignore the bigger picture.
 
Hmmm...

IMO GD asks some good questions...

Here is something to think about:
The UN is attempting to push a new migration treaty... which basically requires all nations to drop their borders... and threatens any media that opposes mass migration with jail time and govt forfeiture of the business.
This is what international organizations do... they come up with idiotic ideas and try to shove them down our throats.

So IMO...
If the WTO is anything like the UN...
Then we would be better off not trusting them to have our best interest at heart.

While it would be nice if we could negotiate better trade treaties...
MeThinks other countries that are used to getting the best deal at the EXPENSE of the USA... are not gonna give in...
Unless there is some pain... thus tariffs... to 'encourage' cooperation.

BTW: Was the intentional embedding of a spyware chip into motherboards by a Chinese corporation... in the best interest of trade?
If not... WHY did the Chinese govt allow it??? (And puuuulease do not say the Chinese govt did not know).
The Chinese have proven they cannot be trusted... so we have to treat them like folks that cannot be trusted.
When they EARN the right to be trusted... we can negotiate with them on a more trusting level.

Do not get me wrong... I do not like the idea of the USA getting hurt by tariffs...
OTOH... I like the idea even less... of continuing to trade on terms that are bad for the USA and good for everyone else.

IMO another question to consider might be:
What 'policies' might be 'necessary' to 'encourage' our trading partners to behave in a more trustworthy manor???
 
I think much is made of tariffs but in all fairness it’s very difficult to pinpoint exactly what is directly linked to them. As I’ve mentioned before, economies are ever changing and continually affected by a combination of micro and macro factors, only some of which are the result of conscious decision made by those in power. Speaking as a business owner in the transportation industry for 26 years, seasonal freight volume changes consistently year over year yet we’ve moved as much steel and aluminum this year than in previous. Port and intermodal activity appear to be strong, even after seasonal adjustments.
 
The real reason we have a trade deficit with China is because of the stupidity of our own government and unions. Our government enacted new EPA standards manufacturing facilities could not afford. These EPA standards also eliminated more than half of our oil refineries as neither industry could possibly see a return on the investment it would cost to meet those standards. Notice China has the worse air pollution in the world as a result.

Unions are greedy and crave political power. You can easily see how unions influence the political platforms of Democratic candidates. Unions don't give a damn about their members, as they have continued to raise their union dues to gain more funding in order to influence liberal political candidates through their campaign donations. Look at how they were rewarded by the Obama automotive bailouts. The political influence the unions have with Democrats was another reason for manufacturing to leave the country.

Tariffs are a two-edged sword. One only has to look at history to see how raising tariffs on imports will lead to increased tariffs on that country's exports. I see the only way to reduce our trade deficit with China is to increase our own manufacturing. That in itself will be tricky as US companies that are currently manufacturing their products in China will not be willing to do so as it would increase manufacturing costs and prices to consumers.
 
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