Free Republic

George Washington. Thomas Jefferson. Abraham Lincoln. Theodore Roosevelt. When you hear their names what comes to mind? The White House? Possibly. Mount Rushmore? Probably. How blasé. What ought to come to mind are tariffs. Yes, tariffs. Despite the mainstream media’s copious efforts to cast President Trump and those who support tariffs as economically illiterate at best — and as wannabe-Stalinists at worst — in reality most of America’s Founding Fathers and former presidents favored tariffs. In fact, America’s first major piece of legislation was the Tariff Act of 1789. Why? Tariffs are the form of taxation most consistent with the...

President Trump needs a trade deal with China as quickly as possible to avert a sharp slowdown of the US economy, as recent polls have made clear. There won’t be any deal unless the US finds some way to walk back its efforts to keep China’s top telecommunication firm Huawei out of world markets. The summary dismissal today of National Security Adviser John Bolton increases the prospects of a deal, although the immediate motivation for Bolton’s departure most likely lies elsewhere. China and the United States seemed on track for a trade deal in early December 2018 when XI Jinping...

Trade wars and sanctions are economic weapons against rival regimes, and like actual military warfare, often lead to unanticipated and sometimes devastating blowback from the targeted regimes. A prime example was President Obama sanctioning Russia over its annexation of Crimea. The sanctions were designed to block Russia from any access to western financing, aimed at causing a dire financial and economic crisis in Russia that would force it to relinquish Crimea and end support for Ukraine’s breakaway territories.

J.P. Morgan estimates that President Trump’s tariffs will cost American families up to $1,000 next year. We have heard this before and we’ll hear it again. But the fact is that tariffs have not yet—nor will they likely—increase the cost of living. Further, the myopic obsession with the price of goods ignores the more pressing problem: millions of Americans remain chronically unemployed, and millions more have been reduced to surviving on part-time McJobs and welfare. Turns out, cheap goods aren’t so cheap if you don’t have a job.

Beijing announced the exemption plan in May and invited interested parties to apply to have certain products added to the list. A second round of applications started last week. The commission said it “will continue to conduct the work of tariff exemption on US goods and will announce follow-up waiver lists at appropriate times”. The statement came as top trade negotiators from China and the United States prepare to meet in Washington next month in their latest attempt to resolve their trade war. Working level preparations for the meeting are currently under way. China is expected to agree to buy...

One of the standard criticisms of President Trump’s trade war with China is that China has the upper hand because it is not a democracy. Meanwhile, President Trump faces voters in 14 months, so therefore it was a mistake to challenge the status quo that allows China to steal intellectual property and pay for its economic and military growth via unending half-trillion-dollars-a-year trade surpluses with the United States. Foolish Trump! The problem with this view is that it greatly underestimates the vulnerability of Xi Jinping -- or any other Chinese Communist Party head. The Politburo and its Central Committee can...

What a difference two weeks makes. Two Fridays ago, pundits seemed to be beside themselves over what was the latest flare up in the U.S.-China trade war. President Trump raised tariffs in retaliation for China’s retaliatory tariffs, he called Fed Chairman Jerome Powell an “enemy,” and the Dow plummeted 623 points while the Nasdaq closed 3% lower. Now it seems like trade deal optimism is back in the air. New formal talks between the U.S. and China have been announced for next month, and there are even high-level Chinese sources suggesting a breakthrough could occur at those meetings.

Did Beijing blink? Just days after massive new tariffs went into effect on both sides of the US-China bilateral trade relationship, China announced it would send a team of negotiators to Washington next month. “Serious” mid-level talks would begin almost immediately in an effort to wind down the trade war, China also announced: China said Thursday its trade representatives will fly to Washington in early October to resume negotiations with the United States, raising the possibility that both sides might arrest a recent deterioration in the bilateral relationship that has cast a shadow over the world economy.China’s top trade...

The public continues to hear or read that President Trump's trade policies are hurting the U.S. economy and destroying our relationship with the world and hurting the U.S. consumer.  They say the tariffs are especially harmful and causing price increases.  I am having trouble finding factual data that support those talking points.  Why do we see general statements in the media instead of the actual data? Here are some of the data: In 2016, the last year of President Obama, exports were $1.45 trillion, and imports were $2.19 trillion. In 2017, the first year of President Trump, exports were $1.55 trillion (up around...

The U.S.-China trade war is clearly putting a dent in China’s economy, but it seems to be helping other countries in Asia. Vietnam is the most prominent beneficiary. “We’ve already seen in our seaborne shipping data that a drop in imports from China has been substituted by supplies from other countries,” wrote Chris Rogers, an analyst at the trade-data provider Panjiva, in an email to Barron’s. “For example in July, total U.S. seaborne imports from China fell by 3.0% year over year while those from Vietnam climbed 28.5% and shipments from India and Thailand rose 17.6% and 16.0% respectively.” While...

When it comes to reaching a trade deal with China, President Trump<Donald John TrumpSenate Democrats warn Trump: Don't invite Putin to G-7 Trump blames Fed for manufacturing slowdown Pence responds to Haley tweet: I'm looking forward to running with Trump in 2020 MORE may be his own worst enemy. Instead of accepting that he already has achieved the bulk of U.S. negotiating objectives — and effectively won the trade war — the president has been sidetracked by procedural issues and negotiating gambits that distract from the overall success of the administration’s policy. Just last Friday, the president created a...

When the White House decided to levy tariffs on goods from China, U.S. leaders were divided on whether a prolonged trade dispute was a wise course of action. Now, so is Beijing. China's leadership is being confronted by government factions offering contradictory approaches to resolving the ongoing trade war with the U.S. Some argue for cutting a deal as quickly as possible to save China's economy; a vocal and growing group of hawks argues China should push back against the United States and avoid an agreement at all costs. As U.S. and Chinese negotiators head into their 13th round of...

One day later, China is still insisting no phone calls took place over the weekend that President Donald Trump claimed showed its willingness to talk again. “I have not heard of this situation regarding the two calls that the U.S. mentioned in the weekend,” Chinese Foreign Ministry spokesman Geng Shuang said at press conference on Tuesday. He had denied on Monday that the calls had taken place. “Regretfully, the U.S. has further increased the tax rate on China’s exports to the U.S. This extreme pressure is purely harmful to both sides and not constructive at all,” Geng said, according to...

“Order? Somebody should tell Chairman Trump this isn’t the People’s Republic of America,” thundered an editorial in the Wall Street Journal on August 23. What prompted this diatribe was President Donald Trump's tweet "Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA.” The WSJ, however, raised more questions about its motives than about the President's sentiment. It is clear what the Chief Executive wants to see happen to strengthen the United States against the rising power of the Republic of...

The president is irked by the dollar’s persistent strength, but he shouldn’t blame China or the Fed. This month the Trump administration officially declared China a currency manipulator. This declaration, the latest salvo in the ongoing U.S.–China trade war, came after the Chinese government allowed its currency, the yuan, to fall to its lowest value in a decade. It is now trading at just over 7 yuan to a dollar. The currency-manipulation designation is one of the most unwarranted charges volleyed against China by the Trump administration. The depreciation of the yuan was largely caused by market forces and, by...

When President Trump issued a series of four tweets in response to China’s tariff threats Friday morning, Wall Street took a dive. A Matt Phillips of the New York Times wrote: Stocks fell sharply on Wall Street on Friday after President Trump responded to China’s threat of new tariffs on American imports with an angry volley of tweets, helping to push the market to its fourth-straight weekly loss. The S&P 500 dropped 2.6 percent, while the technology-heavy Nasdaq index fell 3 percent. The Dow Jones industrial average declined 2.4 percent. Investors were on edge before trading started after Beijing...

The popular narrative goes that because President Trump launched a trade war against China, China has retaliated by tariffing agriculture products from red states that voted for Trump. False. You’ve all seen the headlines: “China is hitting the U.S. where it hurts: Soybeans,” and “China takes aim at America’s soybean farmers,” and “Soybean farmers are still paying for Trump’s trade war” (all from CNN).The popular narrative goes that because President Trump launched a trade war against China, China has retaliated by tariffing America’s chief export to China—agricultural products—which happen to mostly come from red states that voted for Trump. China...

On Tuesday, the markets bid higher following a statement from the U.S. Trade Representative’s office that tariffs will commence on September 1st, but that some products will be delayed until December 15th. To wit: “…some tariffs will take effect on Sept. 1 as planned, ‘certain products are being removed from the tariff list based on health, safety, national security and other factors and will not face additional tariffs of 10 percent. Further, as part of USTR’s public comment and hearing process, it was determined that the tariff should be delayed to December 15 for certain articles.” The only part the...

Loosely defined, a macro tourist is somebody who knows little to nothing about the global economy, economic data, or the direction of that data. But they run from headline to headline to explain the latest development—kind of like a tourist to France who, seeing the Eifel Tower, thinks he has seen “France,” and knows everything there is to know about “France.”To say the macro tourists were out in full force on August 14 would be an understatement. For the first time since 2006-07, before the financial crisis, the yield (annual return) an investor gets for buying a 10-year Treasury was...

"Trump says he delayed tariffs because of concerns over Christmas shopping season" “We’re doing this for the Christmas season,” Trump told reporters on an airport tarmac around noon Tuesday. “Just in case some of the tariffs would have an impact on U.S. customers.” “So far they’ve had virtually none,” the president added. “But just in case they might have an impact on people, what we’ve done is we’ve delayed it, so that they won’t be relevant to the Christmas shopping season.”