VOTE TRUMP!
Posted on 03/25/2016 3:23:49 AM PDT by reaganaut1
[T]he point and purpose of trade is to gain access to those lovely imports from Johnny Foreigner. We only ever import what those foreigners can do better, cheaper, or (perhaps with in season foods) at different times from us. By definition, for the quality of the goods, they must be cheaper. Otherwise why would be bother with the ships and everything? Further, it must be a deal by our lights. None of us goes out and buys stuff we don’t think is worth the money we’re paying for it. This is true of stuff we can do in our own home (wash and iron a shirt instead of send it out) as it is of stuff that could be done in America, China or Mexico (say, build a car). The only time we do buy an import is when we think it’s a good deal.
That is, trade is about gaining access to the good deals possible by buying stuff from foreigners. The exports are just the boring stuff we have to do because those foreigners want more than just pieces of paper for their labour. The point and purpose of trade is access to the imports.
This being so then a 45% tariff, or a 35% one, is indeed a trade war. The problem is that imposing such a tariff on imports into the US would be a war declared by the US government on the US consumer. And if we’re honest about it we don’t think that the point and purpose of government is to make us, the citizenry, worse off. Thus it’s probably not a good idea for the government, or Donald Trump, to declare war on us: nor is it a good idea to impose tariffs upon the imports we buy
(Excerpt) Read more at forbes.com ...
Globalism is terrific....for the globalists.
I love buying those Donald Trump white shirts at Burlington coat factory for about $20-$25, and made in Bangladesh. Is he going to slap a tariff on them, too?
Yeah - how much do them sneakers and “sports wear” made in China cost these days? Consumers aren’t winning - the companies that were enticed to move because of purposeful tilting of the playing fields are winning and the workers in the countries they moved to are winning - like drugs, we’re subsidizing other nations and their people.
When asked about trade wars in the Texas debate, Trump said:
“Well, you know, I don’t mind trade wars when we’re losing $58 billion a year, you want to know the truth. We’re losing so much.”
“We’re losing so much with Mexico and China — with China, we’re losing $500 billion a year. And then people say, “don’t we want to trade?” I don’t mind trading, but I don’t want to lose $500 billion. I don’t want to lose $58 billion.”
It is Trump that says we are sending our companies and technology to Mexico and China.
When he was asked how he would cut $10 trillion over 10 years, but make sure the country isn’t saddled with even more debt?
TRUMP:
“Because the country will become a dynamic economy. We’ll be dynamic again. If you look at what’s going on, we have the highest taxes anywhere in the world. We pay more business tax, we pay more personal tax. We have the highest taxes in the world.”
“It’s shutting off our economy. It’s shutting off our country. We have trillions of dollars outside that we can’t get in. Yes, we will do my tax plan, and it will be great. We will have a dynamic economy again.”
“We’re going to make many cuts in business. We’re getting rid of — we’re going to get rid of so many different things. Department of Education — Common Core is out. We’re going local. Have to go local.”
“Environmental protection — we waste all of this money. We’re going to bring that back to the states. And we’re going to have other (inaudible) many things.”
“We are going to cut many of the agencies, we will balance our budget, and we will be dynamic again.”
Trump is right about that “trillions of dollars outside that we can’t get in”.
https://en.wikipedia.org/wiki/Tax_inversion
The U.S. is unique among developed nations in imposing both a high statutory corporate income tax rate of 35 percent (effective corporate tax rates are lower) and imposing tax on the profits that domestic corporations collect from their subsidiaries abroad. This policy of taxing foreign profits is called a “worldwide” system of taxation, and it contrasts with the “territorial” system employed by most developed countries including the United Kingdom and Canada, which generally tax only profits from domestic activities. The result is that U.S. corporations with subsidiaries in lower-tax jurisdictions face higher taxes on those foreign operations than they would if they were incorporated elsewhere. As Bloomberg View columnist Matt Levine wrote in 2014, “If we’re incorporated in the U.S., we’ll pay 35 percent taxes on our income in the U.S. and Canada and Mexico and Ireland and Bermuda and the Cayman Islands, but if we’re incorporated in Canada, we’ll pay 35 percent on our income in the U.S. but 15 percent in Canada and 30 percent in Mexico and 12.5 percent in Ireland and zero percent in Bermuda and zero percent in the Cayman Islands.”
The Economist explains:
The incentive is simple. America taxes profits no matter where they are earned, at a rate of 39% — higher than in any other rich country. When a company becomes foreign through a merger, or “inverts”, it no longer owes American tax on its foreign profit. It still owes American tax on its American profit.
There is already a trade war in which America is not participating thus losing
Our so called “free trade” amounts to giving our nation away for free. It has to end.
We borrow money from China, give them 8 billion dollars a year so they in turn can buy our products which they do not buy.
Now they are on a shopping spree and buying up hotel chains and real estate developments.
The problem is that fewer and fewer Americans are working, and the stuff being imported used to be stuff made here, using American workers.
Trade imbalances are like any other lopsided economic policy. It takes a long time for their effect to be felt because our system is so large. However, no system is so large that it is immune to the laws of physics.
I’ve seen trade likened to a grocery store, where everyone who shops at that store has a trade imbalance with the store. But that analogy misses an important factor: everyone who works at that store spends their earnings back in the community. That store selling the local produce buys it from local farmers who create jobs and spend their money back in the community. There is no real trade imbalance, because everyone is operating within the community, in the only socioeconomic system that has ever worked: capitalism.
The trade imbalance we have with the rest of the world is that we’re buying, but the store is stocking all of its goods from outside of the community, and the community is producing less than what it consumes from the store. The community will go bankrupt eventually.
This premise is all wrong. We have a nation that is $1T in consumer credit card debt and an entire generation that have worthless college degrees and owe $50K on them.
Not exactly.
Free trade is a two way street.
We get access to their goods and they must get access to ours.
As a businessman, it is a wonder to me that the Donald doesn’t seem to get it. Conservatives have always been for lowering trade barriers as it increases personal liberty, but this is a no brainer.
It’s no different than any other commodity. When it becomes too expensive, you find a new supplier, or go out of biz.
I guess the Donald does know something about this after all. He’s had LOTS of businesses fail.
This aspect of things reminds me of the Japanese acquisitions in the early 90's before they crashed.
The way I see it the Chinese are trying to find stable investments to get their cash out of China before the same thing hits them.
What I worry about mostly, is the Chinese insisting on Chinese food products being served in their hotels and resorts on American soil. I will absolutely NOT buy any Chinese food product I can outright avoid.
Trade war my ass. Trade self-defense is what we need. No more cutting deals so Big Business can screw Americans out of good paying jobs and further redistributing the wealth the top 1%.
You pay for cheap imports twice. Once when you buy the import and again when you have to support unemployed Americans.
Imports should have tariffs that are at a minimum equal to the taxes that domestic producers have to pay plus the cost of supporting unemployed Americans.
Our tariffs are so low, we create a tax incentive for companies to produce offshore.
You pay for cheap imports twice. Once when you buy the import and again when you have to support unemployed Americans.
Imports should have tariffs that are at a minimum equal to the taxes that domestic producers have to pay plus the cost of supporting unemployed Americans.
Our tariffs are so low, we create a tax incentive for companies to produce offshore.
Trump has a big IF with the 45% (and almost everything). IF they keep screwing us we have options they don’t like. It’s an opening bid on negotiations, not an “I’m going to become dictator and destroy they world” statement.
I’m sure the author knows this but hates Trump. Or maybe the author is part of the GOPe and doesn’t care about US workers or economy and trying to get more fair trade deals is counterproductive for the international companies.
Has anyone complaining about the 45% suggested any approaches to helping US economy and workers other than “more NAFTA”, and “more TPP”? I guess Cruz has his corporate tax on imports (which sounds like a tariff but I must be missing something) but that’s the only other approach I’ve seen.
We already lost the trade war when it comes to manufactured consumer goods; it’s not like we’re suddenly going to enter another one.
China keeps manipulating their currency, so whatever tariff we put on goods, they’ll continue to manipulate their currency to compensate for that tariff. It’s not like they’ll suddenly turn around and not trade with the US.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.