Posted on 07/29/2018 5:48:39 AM PDT by Kaslin
“This trade war is cutting the legs out from under farmers,” said Senator Ben Sasse (R-Neb.) on Tuesday, “and White House’s ‘plan’ is to spend $12 billion on gold crutches.”
Referring to Donald Trump’s tariff brinksmanship with China, Senator Sasse was decrying Donald Trump’s request to Congress for compensatory farm subsidies. Sasse insisted that “America’s farmers don’t want to be paid to lose” — but regardless of what farmers want, we should want free trade.
Tariffs are taxes, after all. Consumers ultimately pay for them all.
Now, Trump’s requested “crutches” may amount to nothing more than just another fine example of a bad government program leading to an additional, “compensatory” government program. Also quite bad.
Old story. Too familiar.
Or is it? Could there be more to this story than a failure of trade policy? It seems so. The very next day after Sasse’s public statement, all of a sudden anti-Trumpers found new (and startling) cause to wonder: could we be misunderestimating Trump?
Sure, the senator is right to be alarmed by the “administration’s tariffs and bailouts,” for the president is playing a most dangerous game. Trade wars are not mutually beneficial. Trade is.
And the history of protectionist brinksmanship is definitely not pretty. Sasse himself predicted that Trump’s tariff hikes “aren’t going to make America great again, they’re just going to make it 1929 again.”
Sasse was referring to the passing of the Smoot-Hawley Tariff Act of 1929, which led not only to a spooked Wall Street, but to bank failures and retaliatory protectionism from other countries.
And a worldwide depression.
And world war.
But Trump himself insists that his agenda isn’t ramped-up protectionism. Amidst all his ballyhoo about the greatness of — the sheer wonderfulness of — tariffs, we have occasionally received hints at a very different agenda. Beneath Trump’s pompous, know-nothing protectionist stance — which we have all heared in his decades-long talk-show blather as well as his campaign’s talking points and bizarre Twitter contributions — there has been this dog-whistle to the economists: that what he really wants is free trade.
And this week President Trump lowered the frequency of his transmission for anyone to hear, from ultrasonic whistle to clear clarion call. As Sasse was decrying the China tariffs and the proposed compensatory subsidies to agriculture, Trump stated that he was pushing the EU to drop all trade barriers and subsidies. And then, on Wednesday, he and the EU’s appointed top banana, Jean-Claude Juncker, publicly declared just that.
“We agreed today, first of all, to work together toward zero tariffs, zero non-tariff barriers and zero subsidies on non-auto industrial goods,” is how Trump put it.
Trump also mentioned a deal for Europeans to import soy from America — which was Trump’s way of addressing the China trade situation, which had been getting worse. Indeed, this week China announced a deal with Russia to purchase soy.
So what is really going on here?
Trump has always trumpeted his love of “fair trade,” not free trade. And by this, what he has meant, apparently, is multilateral free trade, not unilateral free trade.
According to classical economics, a country would benefit from a unilateral free trade policy, even if all other countries managed their trade on elaborate protectionist grounds, with high tariffs, subsidies, and all the trappings of mercantilism. But this analysis and policy package has never interested Trump. Indeed, he has decried U.S. official trade treaties like NAFTA as favoring other countries’ producers over ours.
Tellingly, he has never talked about consumers much, and a lot of what he has said was more farrago than genius.
No wonder we have been confused. We free traders expect free trade to be promoted honestly and coherently. It’s our style.
It’s not Trump’s.
Indeed, it should be obvious by now that clarity has never really been part of Trump’s combative modus. He preaches nationalism — economic nationalism, even damn-fool protectionism — while (apparently) really seeking multilateral free trade. The EU is merely the first to hop on board. Trump expects other nations to get on board, too. Soon.
The “irony” here is this: because multilateral free trade is better for everyone in all countries — well, everyone but politicians and the rent-seeking special interest groups that push for special advantages (which somehow also benefit politicians and the political class rather than consumers and producers at large) — Trump’s nationalism is in truth a mere Trojan Horse. America could get by just fine with unilateral free trade . . . but the whole world would benefit from multilateral free trade. Not just America.
For all I know, Trump’s status as a secret free trader could even be a secret from himself. It certainly was a secret kept from me.
But if his boisterous, seemingly bumbling, ugly and nationalistic threats and bluster succeed in getting the world’s nation states to take down existing trade barriers and adopt a more consistent free trade posture, the protectionist win-lose jibber-jabber will vanish amidst legitimate talk way beyond win-win. It would be a situation of win-win-win-win….
And we wouldn’t get tired of the winning.
Many of my relatives are farmers. They go to many seminars to learn how to get the most out of the farm handout programs.
They don’t like it when I ask why they spend so much time applying for welfare. It’s not welfare, it’s SUBSIDIES AND PROGRAMS they say. Whatever it takes to convince yourself, I guess.
I used to be a member of an agriculture discussion group. It was like the rural version of DemocraticUnderground. Many of them backed up their argument with “facts” from the Daily Show, Colbert, Kimmel etc. Pathetic.
Any entrepreneur can see that Trump is executing the art of the deal.
In order to bring countries to the table, he has to show them how bad things could get. He does this by puffing up and making everyone think he’s capable of anything. Then they are surprised he is reasonable in person.
The author is (almost) figuring that out. He should read Trump’s book.
He’s such a Sassehole!
Unlkike Obama and others, Trump realizes his policies will have some short-term consequences and he tries to remedy them so as to not have to deep-six the policies that will eventually bring back some heavy duty manufacturing and put us back on a tangible wealth basis instead of the service based house of cards we have become...
We already throw away tons of tax dollars on farm subsidies. Its odd to start complaining about 12 billion dollars, which is hopefully a one time pay out.
But if his boisterous, seemingly bumbling, ugly and nationalistic threats and bluster succeed ...
Yep.
It’s like they’re sitting around in their underwear, getting aroused by the thought of which one among them can hate our President / our Country and US more.
This is a gross oversimplification. The assumption is that others have accumulated currency and the only option for them is, eventually, to purchase your goods and services.
But that isn't the only option. Giving others calls on your assets, e.g. mortgaging your house, to pay for present day consumption is, according to Ricardo, among other classical economists, a sure path to ruin.
And the difficulties mount with more recent theories, which discuss such things as increasing returns to scale, the origin of economic advantage, etc.
Trump’s secret identity: He DID say, “I am Batman.”
Could we see who owns Sasse through their campaign contributions to his past campaigns? My bet would be Big Ag, the Chamber of Cronies,the meat packers and other lobbyists. If you are going to attack the President of your own Party, there has to be money involved or you are simply a Fake Republican.
It’s really all about protecting the Bush Plan for North Mexico.
We absolutely MUST remove the Bush League Republicans from office and replace them with patriots.
We would not have needed Donald Trump to save US if they were on our side.
Flake, Corker, Hatch, Heller, Alexander, Graham, McCain, Murkowsky, Hoeven, Rubio, Tillis, Burr, Lankford, Gardner, Cornyn, Hyde-Smith, Collins, Sasse, Kennedy, Shelby, Ernst, Blunt, McConnell, Wicker, Portman, Isakson, Johnson, Toomey, Rounds, Capito, Thune, Gaines, Barasso and Enzi are all Bush League Republicans hell bent on making America into North Mexico.
And a big one too.
Super Trump ?
He is retiring from Senate, but is planning to run against President Trump in 2020 if I am not mistaken.
Campaign contributions are laundered through big law/lobbying/hedge fund groups, usually called ‘management’ companies. Sasse is definitely one of their boys.
Jonah Goldberg is a never Trumper as he has shown many times. I wished they would all disappear.
i remember this like yesterday but can’t find any pics of the car...
William T. “Cadillac” Smith, a former longtime state senator from Big Flats, died Tuesday morning. He was 94.
Smith represented the area in the New York state Legislature from 1962 to 1986.
A lifelong Big Flats resident, he ran his family’s 1,200-acre farm along State Route 352 for many years.
He got the nickname “Cadillac” after a stunt he pulled in 1961 to protest the government’s farm subsidy program.
He took money sent to him by the government for not growing corn, bought a shiny Cadillac, put a sign on the back thanking President John F. Kennedy for his generosity, and drove it to Washington, D.C., where he was greeted by Republican congressmen. The stunt was featured in Time magazine in 1961.
Shortly afterward, he was approached to run for political office, said his son, Michael Smith, the sixth-generation owner of Smithome Farms and a Big Flats town councilman.
“He was a conservative Republican, a down-to-earth farmer, and a good guy you could come talk to,” Michael Smith said. “He would stand up for the little guy.”
Corker is retiring, Alexander’s time will come too. You better work on your state to turn it red from blue and not worry about the other states.
Oops! Good point bump! The more negative adjectives used the more likely a negative perception will be created regardless of source or subject.
PG version: For the FOURTH time this week, the ‘ol ball and chain interrupted my FR checks by demanding TWENTY minutes doing the same old same old with a skimpy red cotton tiny shift she stole from our daughter that hardly covered anything. Afterwords I had to take a TWO hour nap. I’ll never get that time back! Jeez - why can’t she just leave me alone?
;-)
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