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 ...
Right. And he didn’t cut taxes on businesses to encourage manufacturers to stay.
That's just not true. You can find the tariff schedules for U.S. imports here: https://hts.usitc.gov/current
You might be surprised by what you see. And then you will realize why so much money is spent on lobbying in DC.
“Right. And he didn’t cut taxes on businesses to encourage manufacturers to stay.”
What is your point?
Because corporate tax rates were unchanged during both Bush presidencies, you can't say tax cuts weren't enough.
They were never tried under either Bush.
That's my point.
But that isn’t why our manufacturing died.
Corporations don’t pay taxes.
Profitable corporations do......
They just pass them on to consumers. Our tax rates haven’t remained the same. Not cutting corporate taxes isn’t the reason our manufacturing has died.
I've never received a bill from a corporation for corporate taxes they paid on their profits.
Our tax rates haven’t remained the same.
Corporate tax rates remained the same from 1993 until 2017.
Not cutting corporate taxes isn’t the reason our manufacturing has died.
I agree. Your original claim didn't make sense.
Not cutting corporate taxes isn’t the reason our manufacturing has died.
I agree. Your original claim didn’t make sense.”
You claimed that corporate tax cuts were enough for manufacturing, I didn’t.
Bush did sign a corporate tax bill
In what post do you think I claimed that?
You might have me confused with someone else.
Bush did sign a corporate tax bill
The centerpiece is $76.5 billion in new tax relief for the battered manufacturing sector, but manufacturing is broadly defined to include not just factories but also oil and gas producers, engineering, construction and architectural firms and large farming operations.
Less than $8 billion a year, I wonder why we didn't see a rebirth of manufacturing.
You said he didn’t cut corporate taxes.
Absolutely... It's silly to assume everyone who plays the markets is a patriotic American... Soros plays the markets, he dumps on us every chance he gets...
He allowed quicker depreciation, for certain companies, which just front loads write offs.
The corporate tax rate remained 35% since Clinton raised it in 1993, until Trump cut it for 2018.
Bush did cut corporate taxes in the link I gave and you did say before that not cutting them is the reason manufacturing died. You don’t know what you’re talking about.
Take a look at Aluminum prices for the last 25 years. They have been up and down ten times. They have been at 0.45 to 1.40 and all over the park. They are about what they were 25 years ago, just over a buck a pound.
http://www.infomine.com/investment/metal-prices/aluminum/all/
He allowed accelerated depreciation for certain industries. The rate was still 35%.
and you did say before that not cutting them is the reason manufacturing died.
Where did I say that?
An interesting thing for all of us to be aware of in our discussions.
Aluminum is still quoted in Dollars per Pound
Steel (in hot rolled coil commodities pricing) is quoted in Yuan per Metric Tonne. That is how much the Asian mills and fabricators control the market.
I was involved in steel fabrication for construction in the early 70s for a while as our steel mills died. They died for a lot of reasons, internal and external. The thing that needs to be realized is that markets helped kill our mills. They were old, they made a lower quality product compared to Japan (at that time the Asian giant) and the USA steel producers had put almost nothing back into our plants as the car and building market from 1940 to 1970 made a gravy train for them.
There are many different types of steel and a variety of prices for the commodity in general. Aluminum in very dependent upon energy costs as the smelting is a large percentage of the cost. Steel has dozens of factors making up its price, it is not just mill operation.
You don’t know what you’re talking about.
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