Posted on 08/25/2016 3:45:08 AM PDT by expat_panama
You work and get paid. To whom do your after-tax earnings belong? Do they all belong to you or does some portion of them belong to the neighborhood grocer whose store you patronize? Who should have first dibs on the money you've earned: you or the auto dealer who sold you the last car you bought?
In both cases the correct answer indisputably seems to be “you.” But not so fast. Typical discussions of trade policy imply that the answers are “the grocer” and “the auto dealer.”
When politicians promise to raise tariffs on imports, they are promising to penalize you for spending too little of your money on products sold by domestic suppliers. The presumption is that domestic suppliers of steel, of textiles or of tires are entitled to a portion of your income. And if you, by buying goods from foreign suppliers, refuse to turn over that portion of your income to domestic suppliers, you must pay a penalty.
Clearly, supporters of tariffs believe that certain domestic producers have a higher claim on some portion of your income than you have.
Does there exist a legitimate justification for this belief? I think not, for none of us supposes that when we patronize a merchant we thereby encumber ourselves with an obligation to continue to patronize that merchant indefinitely.
Suppose that a new supermarket — call it “Jack's” — opens up nearby. Upon your entering Jack's for the first time, the owner informs you that a condition of your shopping at his store is that you must continue, each and every week from here on in, to spend at his store an amount of money that equals the amount of money that you'll spend on your first visit to the store. Would you accept? Surely not.
While nothing in law or ethics prevents Jack from demanding those terms, you'd find it intolerably burdensome to saddle yourself with such a legal obligation.
In fact, while it would be valuable for Jack to secure such a legally enforceable promise from you, he doesn't demand it because he knows that you'd not grant it. Or Jack knows that he'd have to offer to you something remarkably valuable in return, such as his contractual commitment to always charge you prices dramatically lower than those charged by rival supermarkets.
So in reality the deal is that by shopping at Jack's supermarket, you incur no obligation to continue to do so. If Jack wants your continued patronage, he must earn it.
Eventually an even newer supermarket opens just outside of town. This one's owned by Jill. Jill's selection is better and her prices are lower than Jack's. So you start shopping at Jill's supermarket.
Unhappy with your choice, Jack successfully lobbies the city council to slap a special tax on you for every dollar's worth of groceries that you buy from Jill's. You're penalized by the state for spending your money as you choose. The implicit premise behind this special tax is that Jack has a right to a portion of your income.
There is no difference whatsoever between this special tax and a tariff on imports.
Donald J. Boudreaux is a professor of economics and Getchell Chair at George Mason University in Fairfax, Va. His column appears twice monthly.
Diversionist, borne of losing an argument. Income taxes (illegal or not) have no real connection with tariffs, imposts and duties. At tactic unworthy of argument in the context of the gist of the OP.
>>Donald J. Boudreaux is a professor of economics
The econmist’s mantra is ceteris paribus. There’s more to a nation than a disjointed economy that exists only to squeeze dollars out of consumers.
If America needed to suddenly build 2 new aircraft carriers and the 180 aircraft it needs, could the nation that worships global production do it in time?
What is good about a great globalist economy when half of our citizens receive government assistance?
Yeah, sure. Tariffs are taxes. That is a fact. Protectionists never like being told that their love of tariffs is what brought about the federal income tax. It is completely dishonest and anti-intellectual to think for a moment that providing a government today, even of the size desired by conservatives, could be financed by tariffs alone. The argument that tariffs were used in the past to fund government and, therefore, should be used again today - because they are still relevant - requires an intentional disregard for how things work in the real world. Those of us who choose to live in the real world know better. More government is not the solution. You should stop arguing for it.
To perform a Constitutional duty is NOT and ‘additional act’ BTW. Your view of ‘no government’ versus my version of a lawful sane government with no undue influence is different. Okay, I get that.
But is BY NO MEANS gives you the authority for the temerity to order me to “stop arguing” for a Constitutional duty. Shame on you. You frankly sound like an anarchist.
A politicians answer to everything “give us more money, we’ll teach those b@$£@rds a lesson”
No, they haven’t pulled my acct yet, so far so good.
Free trade is absolutely fantastic among nations that share similar standards of living, living costs and labor rates. A similar legal system also helps.
That said, I don't know why a free trade zone among the anglosphere countries does not exist. The Canada-USA FTA was a fantastic success. NAFTA is not so good for countries north of the Mexican border because the junior partner does not have similar standards of living, living costs and labor rates. It will always be so.
“How is that not a tariff and how would it be unfair to charge those countries a tariff equal to their VAT rate on their goods we import?”
Yes it is a tariff and no it not be unfair. However, I am sure there are posters who will let us know how we are wrong.
Can’t have too mucha dat freedum goin on round hear cuz ya caint jus be buyin an sellin whatever yo want ifn the boyz done like it theyz gonna tax yo azz.
Over the years on the FR I’ve seen sentiment swing back and forth between pro-commerce to pro-importtax. With this year’s political crusade the pro-tax folks seem to have taken on a religious fervor. They’ve been calling me a traitor and trying to track down where I am in real life, it’s a combo that I’ve complained to the admin but they don’t seem to care (—or they’re behind it even).
As avid as these clowns have gotten my bet is still that in a few years they’ll get bored and go on to other things like they’ve done so many times in the past.
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