Posted on 03/02/2018 6:13:39 AM PST by reaganaut1
Donald Trump made the biggest policy blunder of his Presidency Thursday by announcing that next week he’ll impose tariffs of 25% on imported steel and 10% on aluminum. This tax increase will punish American workers, invite retaliation that will harm U.S. exports, divide his political coalition at home, anger allies abroad, and undermine his tax and regulatory reforms. The Dow Jones Industrial Average fell 1.7% on the news, as investors absorbed the self-inflicted folly.
...
The immediate impact will be to make the U.S. an island of high-priced steel and aluminum. The U.S. companies will raise their prices to nearly match the tariffs while snatching some market share. The additional profits will flow to executives in higher bonuses and shareholders, at least until the higher prices hurt their steel- and aluminum-using customers. Then U.S. steel and aluminum makers will be hurt as well.
Mr. Trump seems not to understand that steel-using industries in the U.S. employ some 6.5 million Americans, while steel makers employ about 140,000. Transportation industries, including aircraft and autos, account for about 40% of domestic steel consumption, followed by packaging with 20% and building construction with 15%. All will have to pay higher prices, making them less competitive globally and in the U.S.
Instead of importing steel to make goods in America, many companies will simply import the finished product made from cheaper steel or aluminum abroad. Mr. Trump fancies himself the savior of the U.S. auto industry, but he might note that Ford Motor shares fell 3% Thursday and GM’s fell 4%. U.S. Steel gained 5.8%. Mr. Trump has handed a giant gift to foreign car makers, which will now have a cost advantage over Detroit. How do you think that will play in Michigan in 2020?
(Excerpt) Read more at wsj.com ...
Yes, of course an economic newspaper that supports illegal immigration, and defended Bush’s debt and spending shouldn’t be trusted on other issues. You don’t care about American workers and America having any homegrown industries. Taxes go to the government. Tariffs protect American workers and protect the U.S. from being taken advantage of.
“I don’t want American Industries to die, I want American industries to be streamlined and competitive in order to survive.”
You cannot “streamline” enough to compete with some actual and extremely common near-slave labor, with governmental subsidies placed for strategic reasons, and with the legal ability to freely pollute with zero environmental rules.
And it is wrong to call the WSJ an “economic paper”. It’s a globalist economic paper owned by Rupert Murdoch who promised he wouldnt move them to the right from their traditonal stance.
WSJ is not pro-American or America first.
“In a 2004 study, Tim Groseclose and Jeff Milyo argue the Journal’s news pages have a pro-liberal bias because they more often quote liberal think tanks. They calculated the ideological attitude of news reports in 20 media outlets by counting the frequency they cited particular think tanks and comparing that to the frequency that legislators cited the same think tanks. They found that the news reporting of The Journal was the most liberal (more liberal than NPR or The New York Times).”
You don’t care about American workers and America having any homegrown industries. Taxes go to the government. Tariffs protect American workers and protect the U.S. from being taken advantage of.
OH BS. JUST CUT THE CRAP WITH THE OURRAGEOUS STATEMENTS THAT I WANT AMERICAN INDUSTRIES TO DIE AND I DON’T CARE ABOUT US WORKERS. Pretty uppity comments for a newbie. I have been here since 2000 and I care about America and American workers. We can disagree, but you look obnoxious and ignorant when you keep lobbing incendiary comments like that just because someone disagrees with you. Sheesh!
1. I said I don’t care what WSJ says.
2. You don’t know me. I have 3 family members who have either been replaced or had to compete intensely with foreign workers...I care more than you know about Americans because IT HAS AFFECTED ME PERSONALLY thru layoffs.
The tax cuts should spur many homegrown industries and BTW we have a number of them already—just look to Silicon Valley. Oh and Freepers screamed when Obmama exercised crony capitalism for some of them and chose winners...what is different here?
3. No idea what your comment taxes go to government has to do with anything.
3. Tariffs are paid by THE CONSUMER. Taxes have nothing to do with it.
4. Did you know there are over 12,000 tariffs? we pay they for all kinds of things like sugar. Why?
I am not saying there are not things that should be done to improve trade—certainly unfair agreements need to be reworked, but to just throw tariffs on certain industries (Wilbur Ross) and not others does seems like crony capitalism to me.
Done until you can have a mature discussion.
If you don’t understand “money” you don’t understand economics and it’s obvious you don’t.
I don’t need any politician, bureaucrat, lawyer, corporation, labor union, neighbor down the road or blowhard on FR telling me what to do. We nearly had the Civil War in the 1830’s over a tariff the North imposed to destroy the South. Tariffs are just another way for big government to oppress the people to favor their cronies.
1. I never said I support the WSJ. As an investor, I view it as a business publication and don’t care what their editorials say. I do read WSJ articles posted here like many Freepers... That is not the point, I just was commenting to someone else who does not exercise critical thinking who feels that if WSJ is for it, they are against...I just don’t roll with that logic.
2. We have 12,000 tariffs now—on stuff like sugar? If we have 12,000 already and are initiating tariffs on steel and aluminum, why stop there? Many US jobs are in jeopardy. Why are certain industries protected? As I said, I have had 3 family members have to compete extensively with foreigners—2 of them have lost jobs du to foreign competition.
That said, tariffs are paid by middle-class consumers. Do you chose your cars based on fact that they are made by US company, US workers in US? Do you buy your appliances based on US companies, US workers in US? Many if not most people try to get best price. Automotive industry had to reinvent itself and seems to be doing quite well...Freepers here went nuts when Obama favored GM—too big to fail...What is different here?
I know that much trade is not fair and we need to re-think global economics, trade agreements, making our industries more competitive, but to just slap tariffs on favored industries seems like a shortcut. (Wilbur Ross)
We may disagree, but I appreciate your reasoned reply.
“Tariffs are just another way for big government to oppress the people to favor their cronies.”
Our nations Founders, who wrote the Constitution, mandated that the government was to be funded by tariffs.
I apologize, I mistakenly thought you were a sentient being.
“Isn’t that why Walmart thrives?”
No. Walmart is a discount house. Most consumer items are made overseas. Walmart just sells them cheaper.
I was referring to the specific Bush II policy on sheet steel used to make the shells of washing machines and similar appliances.
I was not referring to the bigger picture. The bigger picture is about a lot more than cheap labor. US Labor regulations, US EPA regulations were more costly to many companies than labor differential
US Labor Union control of work rules was more costly than labor. The work rules would not allow high paid workers to do what needed to be done. They sat idle waiting for work to do.
But EDUCATION is behind a lot of our problems. In the 1950s many Eastern Europeans came. They couldn’t speak English but were good at math and excellent for tool & Die and Machine shops. Due to the Iron Curtain and 1965 changes to immigration rules, that source of good math skills disappeared.
US schools were not producing enough people good at math. Draw a line from Chicago to Rockford and you had the Machine tool and Tool&Die Capital of the world in 1950s and 1960s.
But in the 1970s, and increasingly in the 1980s there were not enough qualified mathematically inclined people to staff the high skilled end of manufacturing.
The high math skilled, high priced jobs went to Asia first. It then became cheaper to locate the low cost labor closer to the high cost labor.
We are in even worse shape now. It is amazing the number of IT workers with BA/BS, and even MA/MS who cannot do simple 5th grade math. They don’t know the mulitplication tables. They don’t know common 5th grade concepts such as transitive closure.
One problem with our labor is that much of it is not worth high wages.
Yeah, tariffs are taxes and it’s not like we are undertaxed.
We have too much government: Federal, State and local. The only thing holding the economy back is government.
The arrogance and ignorance of the protectionists knows no bounds.
“Pretty uppity comments for a newbie. I have been here since 2000 and I care about America and American workers.”
Your former username was Bushwon. You are a globalist.
“The tax cuts should spur many homegrown industries and BTW we have a number of them already—just look to Silicon Valley. Oh and Freepers screamed when Obmama exercised crony capitalism for some of them and chose winners...what is different here?”
This is not crony capitalism. This isn’t not letting a company fail or funding something like Solyndra. If tax cuts were enough, then our manufacturing industries wouldn’t have been lost while the Bushes were in office.
Your former username was Bushwon. You are a globalist.
WTH...Again, you are making ignorant obnoxious statements about which you know nothing...I joined during the infamous hanging chad vote count debacle in Florida and bush had won....so I chose that name because I was very frustrated at the media and democrats...I asked and was graciously granted a name change by JR due to bush support of media/attacks on Trump. Of course you were not here waaay back then, so how would you know? You just assumed and attacked me.
You are a noob and fool. Now just stop with the attacks. We disagree, and that is OK...sheesh.
and it was bushwon—small b.
Bush never cut corporate tax rates.
I’m not sure that massive mobilizing of robots is going to be the solution. I remember the story about Henry Ford showing Walter Reuther through his new mechanized plant and bragging about how few workers would be needed to produce his cheaper cars. Reuther’s answer, “Yes, great, but who is going to be around to buy your cheaper cars.” An important problem in US is lack of good trade education in our secondary schools, and lack of apprenticeships. No wonder we are winking at so much illegal immigration. The goal of No Child Left Behind was college education. However, there are many who have no interest in college or lack certain skills to make it a good choice. I had one son with severe dyslexia who dropped out in the 10th grade. I used to have him help me with carpentry and other construction activities. He is now in his 40’s, happily married with children and his own small contracting/construction business. My other son was a restless type like his father. He graduated straight into the military, has over 20 years (82nd Airborne and Special Forces). Plans to retire soon and have his own small business. He had left after his first enlistment, but was not happy with civilian work. When I asked what was bothering him, he said, “I like getting up at 6 am and running 5 miles.” His hyperactive son also enlisted as soon as he graduated.
dila813: I asked my Market savvy friend what “mechanism” promoted by Republicans might stop the tariff move in it’s tracks. He said The World Trade Organization. I don’t understand why the important tariff story is not listed at Breaking News.
Sixty years ago, when I was young, even though I was on a college track, I still could take sewing, cooking, and home nursing in high school. The schools also had shop, carpentry, mechanics, etc. This kind of education has almost disappeared from our schools, so we tolerate illegals. I have a son who is dyslexic. Although he could not learn to read until the 5th grade, he could do math, although until the fifth grade the only numbers he did not write backwards were 0, 1, and 8. I’ve noticed that in mostly black inner city schools the kids often have higher scores on math standard tests. I don’t know if this is because of dyslexia or lack of exposure to standard English, or both.
We definitely need to got opportunities for good non college subjects back in our high schools, also access to apprenticeship programs. The idea that all students should be aiming for college is foolish. I once was helping a group of licensed street vendors try to keep their licenses. We met with a Councilmember. After considerable discussion, I pointed out that half the population was below average in intelligence. He gave me a strange look like, “Wow, I never even thought of that.” I have a college degree, what the heck is “transitive closure?”
A problem with top management pay is that much of their work is not worth $10 to $20 million. Of course they send jobs overseas to cheap labor, otherwise they would not be able to so overpay themselves and still keep stockholders happy.
and the libertarians howled about Reagan’s protectionism:
https://object.cato.org/pubs/pas/pa107.pdf
you’re not supposed to ask that stuff
it is a genius political move if he is stopped, he did something that Democrats talked about without causing any damage.
The Chinese are adding robots like crazy and it’s creating even more jobs. Right now we have very few manufacturing jobs. The only way to go is up.
This is foreign policy, not economics. This is war with China. Trump knows what he’s doing and he told us he would do this before he was elected.
But he was a supporter of NAFTA and globalism.
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