Posted on 07/09/2018 6:24:08 AM PDT by reaganaut1
Who’s the biggest loser when tariffs are imposed on imports? The surprising answer: exporters.
Though completely counterintuitive, theory and evidence show that taxes on imports act just like a tax on exports.
Though it’s early, the Trump administration’s recent round of tariffs is already rippling out to exporters: Soybean farmers face plunging prices as China raises tariffs, Harley-Davidson will move production of motorcycles destined for the European Union out of the U.S., and BMW says foreign retaliation may hit exports from its South Carolina plant.
Economists credit Abba Lerner, then a graduate student at the London School of Economics, for proving theoretically in 1936 that an import tariff was equivalent to a tax on exports. The Lerner Symmetry Theorem is considered a key principle of trade economics, like 18th century economist David Ricardo’s theory of comparative advantage.
The practical link was obvious to protectionists and free traders alike as far back as the 1600s, says Douglas A. Irwin, an economist and trade historian at Dartmouth College. They understood that a country that shuts out imports deprives its trading partners of money to buy exports.
This, Mr. Irwin notes in his book “Clashing Over Commerce: A History of U.S. Trade Policy,” is why Americans were so divided over tariff policy in the 1800s. When northern states succeeded in raising tariffs to protect their manufacturers, they angered southern states who paid more for manufactured goods and suffered falling prices for their exports such as cotton and tobacco. Mr. Irwin’s data show that while exports and imports have varied between 3% and 25% of gross domestic product since 1790, the two tend to move together.
(Excerpt) Read more at wsj.com ...
Wall Street Journal - a reliable globalist, pro-elite mouthpiece.
FY WSJ! Flag-bearer for the Globalist Pukes. *SPIT*
If US tariffs are bad for the US economy, why is no one discussing why country X’s current and retaliatory tariffs are bad for X’s economy?
https://www.freerepublic.com/focus/f-news/3668989/posts
https://www.breitbart.com/big-government/2018/07/08/thank-you-mr-president-owner/
Maybe someone can tell me what successful business(es) that the writer started and/or ran and how he became a multi-millionaire, billionaire. I’d like to know how he did it.
Harley Davidson sales have been plummeting for two years. Not to say the tariffs didn’t hurt them more. But they were on their way to another bankruptcy
Cute little headline; but in the real world, tariffs overall will be going down. EVERYONE needs us more than we need them. That’s called “sitting in the catbird seat”, “playing with house money”.
America adopted ‘free trade’ after WW2 in order to build the economies of ruined countries so they would not fall into the Soviet camp. ‘Free trade’ wasn’t the fetish it has become. It was understood then that ‘free trade’ was an act of charity by the USA, even though we stood to gain in terms of national security.
Europe and China don’t need our charity now.
Here we go..THE FEAR MANTRA...buckle up!!! This will be the new scare tactic from the globalists. The sky is falling mediapukes will spew this 24/7 from here until the midterm election! They’re going to do their darndest to destroy the economy! Remember they don’t care if all hell breaks loose in America they want their power back! Come hell or high water!!
Our domestic enemies WANT a bad economy, to pay us back for electing Trump.
Several Valley business owners say they are already experiencing the pinch from the Trump Administration’s tariffs on imported materials.
Anna Martin, co-owner of Martin’s Steel in Mifflinburg, said the cost of aluminum has risen about 45 percent and steel has gone up about 30 percent since the tariffs took effect last month.
Mike Dupuy, a Middleburg falconer who invented and builds hawk houses and aviaries out of steel and aluminum, said the tariffs on Canadian steel and aluminum have added as much as 21 percent to the cost.
He’s raising prices and said there’s been a noticeable slowdown in sales.
“People that would have bought are now hesitating. We’re losing business,” Dupuy said. “For small businesses like us, the tariffs are making a difference.”
They are for Leon Martin, owner of Orchard Hill Welding in Millmont, who said he’s losing contracts he usually would secure because of the higher cost.
Frank Leto, publisher of The Daily Item and The Danville News, said tariffs imposed on Canadian newsprint producers is causing “considerable harm” to U.S. publishers, particularly those in the Northeast that rely on Canadian newsprint.
This area went about 70-30 for Trump in 2016.
If US tariffs are bad for the US economy, why is no one discussing why country X’s current and retaliatory tariffs are bad for X’s economy?
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Exactly, There was an interesting book I read years ago called “The Rise of the Rest”. It was how southeast Asian and especially Indonesian countries used tariffs and other trade barriers to promote demand for locally manufactured products. Only when those manufacturers reached an economy-of-scale which allowed them to compete globally did they start easing foreign tariffs. Are we shocked that the WSJ never mentions those successful tariff stories?
Virtually every country in the world has tariffs and trade barriers well in excess of the US. Especially China.
“Because I think one way you get rid of Trump is a crashing economy. So please, bring on the recession,”
EVERYONE needs us more than we need them. That’s called “sitting in the catbird seat”, “playing with house money”.
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To prove your point, America consumes (imports) over 30% of the world’s output of goods and services and is by far the world’s biggest consumer and market for other countries goods.
In a trade dispute, due too our deficit position we can levy increases on a whole lot more items than can the nation enjoying the surplus.
This is what Trump meant when he said “trade wars are easy to win”
Exactly.
Every day, PDJT’s election shines a light on the Cockroaches that, ‘We The People’ are up against! MAGA!
“If US tariffs are bad for the US economy, why is no one discussing why country X’s current and retaliatory tariffs are bad for X’s economy?”
Exactly! We’re supposed to just bend over like we have for the last 40 years! Well, that ain’t flying with Trump. He knows the game, he sees the scam, and the jig is UP!
Anecdotal and mostly bs. Trump just handed these whiners a 40% tax cut. Why don’t the fools use this savings to offset the tariffs increase?
Simple answer is they are not just greedy, they are stupid to boot.
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