Now we’re talking Great Depression comparisons.
The Smoot-Hawley Act of 1930 – which boosted U.S. tariffs on imports by an average of approximately 50% – exacerbated what was already a negative economic spiral. It led to a trade war and a currency war.
That’s a sharp contrast with the present global condition, which is a “currency cold war.” Countries are devaluing their currencies “but in a fairly benign way” in order to stimulate their domestic economies.
Increase tariffs causing more harm than helping has always been the dogma of economic regulators. Increasing tariffs for the purpose of retaliation is worse. I would rather see Mr. Trump ease government regulations, small business taxes, and deport lawyers file frivolous lawsuits against businesses.
“Trump advocates a 45% tariff”
False.
This BS has been denied multiple times.
It’s just like the KKK smear.
Republican position: Crap sandwich on rye.
Trump position: No more crap sandwiches.
47 posted on February 27, 2016 at 7:18:27 PM CST by DuncanWaring
Have you never heard of leverage?
Trump is a negotiator. Our side needs to talk the talk, then we can make a deal that will be fair to both America & China. If you bid on a house you don’t bid what you want to pay and you don’t say “but if it gets serious we can raise our price.” You start out very strong and as the other side shows some flex you show some flex.
As the lead negotiator for a deal if you don’t start out way over where you expect to settle you get scrod.
It is called the “Art of the Deal”.
You go into a meeting with the other country worrying that you are going to impose a tariff.
That gives you the power to negotiate an agreement you want in return for not imposing a tariff, a tariff you never intended to impose to begin with.
The only reason we don't presently have a trade war is because thge US won't fight. Chinese already impose tariffs
The Smoot-Hawley lie on the first post. Wow.
You think the current trading is a level playing field? If so, vote for someone other than Trump. If you’ve ever done actual business with or in China, you would understand Trumps point.
The Mexicans and Chinese need us more than we need them.
Tariffs were the main source of all Federal revenue from 1790 to 1914.
https://en.wikipedia.org/wiki/Tariffs_in_United_States_history
“The Smoot-Hawley Act of 1930 – which boosted U.S. tariffs on imports by an average of approximately 50% – exacerbated what was already a negative economic spiral.”
The difference now is we’re a (yuge) net importer.
The world has been actively draining the USA via the “free trade” wars of the last 30 years.
It’s time we won these trade wars. GOPe is all for maintaining the status-quo as is the author of this article.
“The problem is that trade partners will retaliate.”
How? China and Japan buy little from us now and charge tariffs on everything we sell them.
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.
http://www.bloomberg.com/infographics/2014-09-18/tax-runaways-tracking-inversions.html
April 13, 2015
Corporate Expatriates: See the Data
The roster of corporate expats includes inverted companies and former divisions that they spun off as independent entities, as well as U.S. firms that got a foreign address through a leveraged buyout or other ownership change.
Cyberonics Inc. moving from Texas to England
Wright Medical Group Inc. Tennessee to Netherlands
Steris Corp Ohio to England
Civeo Corp from Texas to Canada
Applied Materials from California to Netherlands
C&J Energy Services Ltd to Bermuda
Mylan Inc. from Pennsylvania to Netherlands
Medtronic Inc. Minnesota to Ireland
Burger King Worldwide Inc. Florida to Canada
Horizon Pharma Inc Illinois to Ireland
Theravance Biopharma from California to Cayman
Paragon Offshore Plc to England
Endo International Plc from Pennsylvania to Ireland
Tower Group International Ltd New York to Bermuda
Liberty Global Plc Colorado to England
Perrigo Co. Plc from Michigan to Ireland
Actavis Plc New Jersey to Ireland
Mallinckrodt Plc to Ireland
Allegion Plc to Ireland
Tronox Ltd. Oklahoma to Australia
Rowan Cos Plc from Texas to England
Aon Plc Illinois to England
Eaton Corp. Plc from Ohio to Ireland
Pentair Ltd to Ireland
Jazz Pharmaceuticals Plc California to Ireland
Stratasys Ltd Minnesota to Israel
D E Master Blenders 1753 NV to Netherlands
Alkermes Plc Massachusetts to Ireland
Trinseo SA to Luxembourg
Valeant Pharmaceuticals Intl Inc California to Canada
Altisource Portfolio Solutions to Luxembourg
Invitel Holdings A/S Washington to Denmark
Ensco Plc Texas to England
Samsonite SA Massachusetts to Luxembourg
Altisource Portfolio Solutions SA to Luxembourg
Convatec Healthcare B S.a.r.l to Luxembourg
James River Group from Virginia to Bermuda
Argo Group International Holdings Ltd Texas to Beruda
Covidien Plc to Ireland
TE Connectivity Ltd. To Switzerland
Freescale Semiconductor to Texas to Bermuda
Travelport Wordwide Ltd to Bermuda
Sensata Technologies Holding Nv to Netherlands
Lazard Ltd New York to Bermuda
Global Indemnity Plc Pennsylvania to Ireland
Michael Kors Ltd New York to Hong Kong
Nabors Industries Ltd Texas to Bermuda
Herbalife Ltd California to Cayman
Noble Corp Plc Texas to England
Weatherford International Ltd Texas to Ireland
Cooper Industries Plc Texas to Ireland
VistaPrint NV Massachusetts to Netherlands
Global Santa Fe Corp Texas to Cayman
Ingersoll-Rand Plc New Jersey to Ireland
Accenture Plc Illinois to Ireland
Foster Wheeler AG New Jersey to Switzerland
Tycom Ltd to Bermuda
APW Ltd to Bermuda
Everest Re Group Ltd New Jersey to Bermuda
Arch Capital Group Ltd Connecticut to Bermuda
Seagate Technology Plc California to Ireland
PXRE Group Ltd New Jersey Bermuda
White Mountains Insurance Group Ltd Vermont to Bermuda
Fruit of the Loom Ltd Kentucky to Cayman
Transocean Ltd Texas to Switzerland
XOMA Ltd California to Bermuda
Gold Reserve Inc Washington to Canada
Chicago Bridge and Iron Co. NV Illinois to Netherlands
Tyco International Plc New Hampshire to Ireland
Loral Space & Communication Ltd. New York to Bermuda
Triton Energy Ltd Texas to Cayman
Helen of Troy Ltd Texas to Bermuda
Core Laboratories NV Texas to Netherlands
Flextronics International Ltd California to Singapore
McDermott International Inc Louisiana to Panama
Trump follows Sun Tzu’s wisdom for war:
“The whole secret lies in confusing the enemy, so that he cannot fathom our real intent.”
Globalist pi**sing their pants.
Good.
The problem is that trade partners will retaliate.
Mexico and China have NO MEANS OF RETALIATING!
They Need US, We DON’T need them.
Hmmm. Interesting objection. If we apply a tariff they’ll retaliate by putting one on our goods? But we actually export relatively NOTHING to China.
You’re saying they’ll put a tariff on goods we’re not allowed to sell in their country anyhow? So suppose they impose a 50% tariff. 50% of nothing is NOTHING! I fail to see the downside you’re so desperate to predict.
GO TRUMP!
Devaluing their currencies in a very benign way? Does that mean when they rape us they use a condom? Isn’t that kind of them?
This guy never read The Art of the Deal. The threat of a tariff with some countries is only a bargaining tool; to induce the other country to balance their manufactured goods SOLD TO US BY THEM, with an equal value of goods and agriculture products BOUGHT BY THEM FROM US.
All Trump insists upon is a level playing field. It’s more involved than the above, but that’s the basic premise.
