Im a Trump supporter but no one including Trump has it all right and Trump is wrong on the trade issue.
It is false and misleading to say we lose $500 billion to China every year. Our imports from China in 2015 totaled close to $500 Billion. He and the trade deficit folks call this a $500 billion LOSS. But of course it is not a loss because we traded dollars for goods.
Did I lose $100 when I bought my groceries the other day? Of course not. I got groceries for money. I didnt LOSE when I paid for the groceries I needed. And what Trump is proposing is instead of me paying, say, $100 for goods from China, Ill be forced to pay more, say, $200 for the same thing because of these tariffs (taxes) and protectionist measures.
Taxing imports to try to force companies to stay here doesnt solve the problem. Everybody loses and the consumer now has to pay higher prices because the government has put a 35% tax on incoming goods.
The tax (tariff) doesnt hurt Mexico (or any importing country) - the prices (A) are already contracted for between Mexican and U.S. distributors. Mexico only pays A. The tariff/tax (B) forces the costs of these goods to go higher as they enter our country forcing higher prices at the local distributor for the American consumer who has to pay for A PLUS B. So its the American consumer that is really paying for the wall and exited businesses in the form of higher prices forced upon them by these tariffs. Our tariffs directly injure the American consumer and, thus, the American economy.
So not only do tariffs not address the root causes of business moving out of America, they make matters worse. Trump needs to address the ROOT CAUSE of losing our businesses: the FEDERAL GOVERNMENT. The federal government has created an unfriendly business environment in the U.S. with boneheaded policies like
- minimum wage
- taxes
- regulations
- federal protection of unions
Again, the issue is the unfriendly American business environment and weak American competitiveness caused by the skyrocketing costs of doing business due to GOVERNMENT INTERFERENCE like taxes, minimum wage, regulation, and unions. Address THAT and business will WANT to return/stay because of cost benefits.
Let the voluntary cooperation of the market economy free of government interference work. Dont layer more government interference upon that which is the root cause to begin with.
If we were just exchanging goods, that would probably be true. But we buying goods from countries with high unemployment and they aren't buying goods in return. They are buying our debt and equities. We are in effect liquidating our country to buy their goods. Their cheap imports are causing high unemployment here. And then we have to pay to support unemployed Americans in addition to what we paid for the cheap imports.
It would be good if that's actually what we had, but we don't.
Trade =/= They get the jobs, and we get to pay them for the widgets they made with those jobs.
What EXACTLY did we trade outside of our money, self-respect, and the economies of our cities?
Permit free trade between all nations regardless of Communist (or Islamist) affiliation and regardless of whether or not items could be used for war.The commies do not abandon their goals simply because the USSR fell (or did it really?)Goal #4 here just has a slight update to reflect what is happening today.
NAFTA didn’t do one good god darned thing for me.
I don’t anticipate a lot of friendly comments to your post. The Freepers, at least the vocal ones, are (along with Trump) in a very protectionist mood these days.
Not me. I’m with you on trade. It will be never be “Free” but tariffs and such will make things much worse, raise the prices and cost us business and jobs.
Free trade hasn’t been free, though. We’ve opened our market while the majority of the world remains mercantilist and protectionist. We’ve allowed entire sectors of the domestic economy to be practically wiped out, to the detriment of working class citizens. There needs to be some concern over the health of the domestic economy above and beyond stock valuations. Public assistance has skyrocketed, it’s not as if there has been no cost to bear. Average incomes are going backwards, savings have plummeted. If protectionist measures in some instances are required to stabilize and reverse this damage, so be it. People who fell in love with free trade as ideology fail to see that it’s not at all working out as promoted.
Yes, Heritage would be pimping ‘free trade’...their head economist, Stephen Moore always pushes amnesty and ‘free trade’....the problem is...it ISN’T! Agreements like Nafta, TPP are government MANAGED cheap labor, sovereignty busting sell out deals to profit the few lobbyists who write them!
Even Milton Friedman said Nafta was NOT free trade. FREE TRADE does not take thousands of pages to implement.
Heritage is just another so called ‘conservative’ entity who has you conned!
Free trade works great!
For China.
There IS no free trade. Period. This isn’t the 50s where most corporations are small to medium, selling their goods. This is a world with nothing but mega corporations getting the cheapest labor wherever they can find it and doing nothing but maximizing profits.
In short, this article is so wrong it hurts.
In theory, yes. In a college classroom, yes.
But in reality, no!!! American workers can "specialize" in nothing. Because whatever specialty you pick, foreign labor can undercut it. Ten dollars an hour American labor simply cannot compete against one dollar an hour foreign labor, regardless of th category.
The "free trade" meme is toxic. It will absolutely destroy the American middle class. But you will get a cheaper shirt at WalMart. That's a poor trade-off, in my opinion.
I’m for FAIR trade. No product dumping like the Chinese etc do.
“Why America Needs to Support Free Trade” So the 0001% can employ slaves at 17cents per hour?
“Free trade:”
Elites and billionaires get the goldmine.
Ordinary Americans get the SHAFT!
Trump is absolutely right on this issue.
I disagree.
Factories which make goods (as well as the sourcing for the raw materials) will determine future wealth. Third world nations attracted factories with cheap labor which has been steadily replaced with growing automation.
Those factories are magnets for innovation. By exporting our factories, we’ve also exported that innovation. While we continue to excel at creating the technologies that will make those factories more efficient, we also have cut ourselves off from the profit from those innovations.
Yes, overall, our cost of goods have plummeted, with almost every metric for measuring wealth exceeding inflation. But we did this on credit against future creations.
Yes, we designed the machines that pluck the needed rare earth materials, but they are built elsewhere, and those needed materials won’t be exported. We designed the machines used to make the goods, and sold those templates to others to build.
Yes, it will be expensive to return much of those factories to the mainland, and it will hurt the short term economy. But please explain where the economy of the future is?
80% of the working population is in service related industries, more than half of which can immediately be replaced by existing automation for less than two years of salary and benefits. (30% can be replaced with automation that costs less than six months of salary and benefits.)
The problem is that the TPP is not a free trade agreement, nor is NAFTA or the countless other trade deals.
Free trade is thoughtless fanaticism all with a nasal look and glazed eyes.
At the onset of free trade mania under GHWB the usa had ‘comparative’ advantage in all things. 30 years later the nation is nearly deindustrialized. Get your face out of Ricardo’s book and open your eyes dammit!