Posted on 03/31/2025 6:12:57 AM PDT by RandFan
This is the correct short-term outlook but he is ignoring the long-term outlook. Increased domestic demand leads to increased domestic production which in turn leads to lower prices. Increased domestic production leads to increased employment for working class Americans.
Increasing our domestic manufacturing base has National Security ramifications as well. If things go badly with China our ability to convert domestic production to wartime production is important.
You make a great point. Why are all these countries so worried about the impacts on Americans? If it is so bad for us, and great for the other countries, as constantly implied by the media and globalists, you would think they would just stay quiet and watch the incredible benefits roll in.
After all, we are told to believe that every other country benefits greatly by this, while we are the only ones that will suffer.
“could be”? rand is wrong on this. no pain no gain
But more money and more jobs staying here. The world needs our markets more than we need theirs, esp in the long run.
Hey Rand, here is a question, why are tariffs okay on US goods , but tariffs on theirs is not.
Simple solution, they drop their tariffs and we drop oursđ€
American production will rise and every American will be better off.
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That remains to be seen. Without drastically cutting our spending and debt, we are cooked. More we are now paying more than $$$1 trillion on interest payments alone.
Generating income from Tariffs fine and dandy, but we are cooked if we donât get our government spending down drastically.
â CBO Issues Dire Forecast for US Debtâ
The US Congressional Budget Office is warning that the federal deficit has hit a point of no return. It is far too late to cut wasteful government spending. Politicians have kicked the can down the road for far too long and left us with a financial system held up through perpetual borrowing that cannot be reversed.
The CBOâs long-term forecast shows the federal deficit rising to 7.3% of GDP by 2055, but the figure is currently at 6.2% as of 2025 and this is an optimistic report. In contrast, the 30-year average from 1995 to 2024 was 3.9% of GDP. Public debt is projected to hit 156% of GDP by 2055, up from the 100% of GDP we face today.
Now the CBO mentioned that Trumpâs tariffs could negatively impact the economy but we reached the point of no return years ago. Trump cannot be blamed for the current situation in the least. âMounting debt would slow economic growth, push up interest payments to foreign holders of U.S. debt and pose signiïŹcant risks to the ïŹscal and economic outlook,â the Long-Term Budget Outlook: 2025 to 2055 stated.
The Baby Boomer generation is at or nearing retirement and Social Security benefits are currently at 5.2% of GDP. The CBO believes this will reach 6.1% of GDP in 2055 but fail to recognize the fund is drying up. The Ponzi Scheme will come crashing down.
Interest expenditures alone have hit 3.2% of GDP as America. In 2024, the US spent $881 billion simple to finance its massive debt, and that figure is projected to reach $1.8 trillion by 2035. We spend more on servicing debt than we do on defense spending at this point.
Raising taxes cannot solve this massive issue, but that will not prevent the government from attempting to extort the people to cover their fiscal mismanagement. The government knows it is trapped and will continue to hold off on paying down their debt as long as possible. Worse still, other nations are decreasing their investments in Treasuries as we have seen with China and Russia. Japan is our main buyer now but they have their own colossal problems.
“Most large businesses will wait at least 4 years before making huge investments to see what the next election will bring.”
Announced investments have time commitments.
This announcement by Hyundai has a plan for all plants opened & enlarged by 2028. Hyundai isn’t waiting 4 years...
South Korean carmaking giant Hyundai has unveiled $21bn (ÂŁ16.3bn) of investment in the US just days before President Donald Trump is set to impose new tariffs on trading partners. The plan includes a new $5.8bn steel plant in the southern state of Louisiana.
Hyundai also said it will expand its American vehicle production and invest billions of dollars in new technology including autonomous driving and artificial intelligence (AI). Hyundai said the new steelmaking facility will produce more than 2.7 million metric tons of steel a year and create more than 1,400 jobs.It is expected to make steel for Hyundai’s plants in Alabama and Georgia.
The announcement also included plans to invest $9bn to boost the firm’s production in the US to 1.2 million vehicles a year by 2028.
https://www.bbc.com/news/articles/cgkmvdz144vo
This is an example of a build announced in 2022 opened in early 2025.
“We heard the clarion call of [the Biden] administration to hasten the adoption of new electric vehicles and reduce carbon emissions,” JosĂ© Muñoz, then the CEO of Hyundai Motor North America, said in 2022.
But at the plant’s grand opening last week, as executives and politicians praised Hyundai’s multibillion investment in the region, the thousands of jobs that come with it, and the plant’s advanced manufacturing technology, something was conspicuously missing from all the speeches. The article goes on to say that rather than EV the plant is making hybrids.
Free trade makes all the sense in the world IF all countries and people are peaceful. However, that is not the case.
Ask an economist if we should buy our weaponry from our enemy, if they are the low-cost producer? That should get him thinking and generate the answer “No.” The US needs a manufacturing base for national security. As one example of many, the M-1 Abrams tank was made by the Chrysler corporation. What if we never had car companies?
We also need manufacturing for social cohesion. Not everyone is ready to write code - not the bureaucrat from the Department of Education, not the liberal “fact checker,” not the coal miner.
Free trade does not exist. Other countries tariff US products. Reciprocal tariffs may be the best way to force tariff reductions.
A return to US manufacturing will tend to raise prices. It’s worth it. On the other hand, increased economical energy production (coal, natural gas, nuclear, ICE) will tend to lower prices.
There are many other changes that are taking place that should be for the better. However, it has to be admitted that change itself is disruptive and generates expenses.
The American revolution happened for freedom, not to reduce the price of eggs. That applies today as well.
A lot of this assumes Tariffs work to stop foreign goods. Another possibility and one that is more likely. Is that tariffs are just paid. An Iphone cost less than a hundred dollars to make. The components of the low end Iphone are around 10 dollars. It sells for around 1000 dollars. There is no way that the 25% tariff $2.50 makes a difference here. The mark up of foreign goods coming to America is so high that most tariffs don’t matter. They will just pay down the debt. If they do matter, production will come to America.
Amazing how they leave out that India, Vietnam and other countries are lowering tariffs. Trump is actually making trade more free and fair, not just saying it. In addition to bringing back manufacturing. Fun fact, behind Tesla the largest US car manufacturer is Honda. Based on % of parts manufactured here.
Amazing how so many people prefer to be ignorant and let the commie media/dems spoon feed them nonsense.
A disaster isn't necessary a bad thing.
Our economy was overheated due to Bidenomics.
So we need a Volcker style treatment to shock the economy to crush inflation.
Trump's tariffs is one way to do it.
Hopefully it won't last long and we'll end up negotiating better trade deals with other countries.
“A good analysis by economist Peter Schiff.”
It is a crap analysis. That is the kind of thinking that de-industralized the United States.
Let me ask you and Schiff a question. If Trump imposing tariffs on imports increases prices in a continual upwasrd spiral and harms our economy, then why do the gleefully imposed tariffs imposed by foreign leaders on imports into their country not increase prices in a continual spiral and harm their economies?
Why don’t all the nations eschew tariffs like the plague if they so harm their citizens and their economies?
But you can note, the countries love their tariffs.
Nobody disagrees that zero tariffs would be ideal - President Trump understands that.
This is not our choice - these are reciprocal tariffs - which will be lifted the minute our trading partners lift the trade barriers placed on us.
The ball is entirely in their courts.
Iâm so tired of hearing platitudes about free markets - everyone knows free markets are awesome - itâs beside the point.
Thatâs like saying we shouldnât stop burglary because the burglars are willing to sell our stuff back to us for a cheap price. Rand is only seeing the cheap Chinese junk they sell us, and forgetting the good jobs they stole. If we fall for that nonsense weâre like a battered girlfriend who defends the abusive boyfriend because he gives us bandaids for our injuries.
I agree.
Instead of putting tariffs in place, let’s negotiate to remove ALL tariffs between allies! Only keeping them on our adversaries... like China...
Shares of the âDetroit Threeâ all fell. General Motors, stock dropped move than, 7%, while Stellantis, and Ford Motor shares lost roughly 1% and more than 3%, respectively.
Shares of Tesla however, were mostly unchanged....
(This whole auto-tariff idea is tailored to please MUSK / Tesla, no one else.)
Detroit automaker shares fall after Trumpâs tariff announcement
https://www.cnbc.com/2025/03/27/auto-stocks-trump-tariffs.html
Problem with free trade is labor cost differentials.
To illustrate, what are the labor costs for slaves? Pretty close to zero, especially if only providing bare necessities and unsafe living and working conditions.
Such a regime could easily undercut any competitor.
Labor Unions are only 6% of the workforce and declining.
Where is the stick you are using to lower tariffs for our trading partners?
These countries have been raping the USA and destroying our industrial base for decades.
Tariffs are the only weapon to achieve a change.
Once again, removing tens of millions of illegals from the country is a counterbalance. They compete for the same resources and groceries while being subsidized and not paying income taxes. Get em the heck out!!
What are the long term effects of chemo therapy?
Think of tariffs as economic chemo therapy for an economy being destroyed by globalism.
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