Posted on 06/22/2019 5:42:43 AM PDT by Kaslin
President Trump’s barrage of tariffs could blow up our economy in a way not seen since Congress passed the 1930 Smoot-Hawley Tariff Act. We know how that ended. It took World War II to get us out of the worst depression our nation ever faced.
The analogies between then and now are striking. Overwhelmingly, economists opposed the tariffs in 1930. Today, Peter Navarro, who serves in the White House, is the only economist I know of who thinks tariffs are a good idea. And last week he suggested we pull out of the World Trade Organization (WTO), despite the fact the U.S. helped create it and the WTO has mostly sided with the U.S. in resolving trade disagreements. Navarro wants to build an economic fence around the U.S. with unprecedented isolationism.
In 1930, trade was a tiny percentage of our GDP. Today, it represents more than 27%. Going isolationist in 2019 would gut many of our biggest companies and exporters.
Why? Because we not only have global supply networks, but when we sell globally, countries - some of them our biggest customers - retaliate.
China has already blocked U.S. agriculture exports and held American cars on Chinese docks. It is reportedly considering blocking rare earth mineral exports to the U.S. and blacklisting companies. In 1930, Congress put tariffs on thousands of products, countries retaliated with similar tariffs, and the world economy spiraled downward into a dust bowl of poverty.
As the president and his administration build an economic fence around the nation - threatening a healthy economy - congressional power erodes. President Trump’s actions isolate us from trade with the 95% of the global population that does not live in the U.S. Meanwhile, as we escalate disputes with our largest trading partners, economic warning signs pile up. The market is increasingly volatile. Investors are running for cover. Consumers are beginning to feel the tariff bite. Aggressive trade wars are hastening the end of one of the strongest economies in U.S. history
History will judge this era harshly. The next recession will not be just the “Trump Recession” - it will be all of ours to own and survive. We must change course, so tomorrow doesn’t bring a full-blown depression.
Gary Shapiro is president and CEO of the Consumer Technology Association (CTA)™, the U.S. trade association representing more than 2,200 consumer technology companies, and a New York Times best-selling author. He is the author of the book, Ninja Future: Secrets to Success in the New World of Innovation. His views are his own.
Isn’t AOC’s alma mata Boston University, not Binghamton University?
Actually I remember old folks saying “Back in nineteen-hundred-and-fourteen...” But I get your point.
AOC does NOT have an Ec0n degree! Her degree is in IR with an “ econ track”.
Shapiro also is not a dummy but he is mistakenly thinking tariffs will inhibit innovation, which his book claims is key to economic success. The opposite is true because innovation requires excess capital that can be reinvested and manufacturing provides that.
Wrong, Boston
More Salem claptrap.
Why does this junk keep getting syndicated here?
Actually, and this is an argument that drives the left and RINO right crazy, since there are unpaid externalities (pollution, national security risk and costs, etc.) to shipping from abroad what could be produced locally, some sort of tariff/tax on that extended shipping should be imposed on such imports.
You know the economy is doing well under republican leadership when the liberal media post scary stories about the economy.
Guys like Shapiro try to claim that tariffs caused the Depression.
Fact is, the Depression was well under way when they passed the tariffs.
And the big tariff increases by other countries was in the mid 1930s.
It’s more like the Depression caused the tariffs.
Why does global trade have to be altruistic on our part?
If a politician feels the need to be altruistic with tax dollars that politician needs to be removed from office, and banned from any political exercises forthwith.
The article you linked makes a slam dunk case that Smoot Hawley and Protectionism did not cause the Great Depression (It only raised tariffs from 44% to 53% on just one third of US imports - and those imports effected by Smoot Hawley only totaled 1.3% of the US economy).
Smoot Hawley added less than one tenth of of percent additional cost to the economy, and did not even noticeably effect the volume of imports that it covered.
The article points out that the Federal Reserve reduced the money supply by one third, between the 1929 stock market crash and 1933. That is a huge (the real) cause of the depth and length of the Depression. But that was the Democrat’s policy mistake, so they need a cover story to deflect blame.
The article did not mention the initial cause of the October 1929 Crash (which is also why the Depression was widespread around the world) - the collapse of the British Pound, which then was the Global reserve currency (after the Leftists swept the May 1929 elections, and Labour Party Prime Minister MacDonald took power).
It doesn’t endanger our future. Only the elitist money hoarders. That under pay the working class. This is no less than slavery through controlled low wages.
So it’s OK for China to have tariffs on our stuff but not OK for us to have tariffs on theirs?
FUAD.
I was way off. He sent to Binghamton
AOC Boston
But:
She graduated cum laude from Boston University’s College of Arts and Sciences in 2011, majoring in international relations and economics.
Education: Boston University (BA)
That’s an economocs degree
Also, Wikipedia ( or BU) has changed the text re entourage. After she got into congress it read that she had graduated BU with an economics degree
Yes many a nation has became prosperous exporting high end manufacturing jobs and agricultural products. /SARC
But the impact of trade was miniscule when compared to the size of the overall economic contraction. Government expenditures remained essentially constant, but private consumption and investment plummeted. Of the $131 billion in lost economic output over the five-year period, only about $0.7 billion seems attributable to trade. This is shown as the last entry in the last row of the table. In either absolute or relative terms, the trade portion of the economic contraction of the Great Depression appears to be of little import.
Read more:
https://www.americanthinker.com/articles/2011/01/smoothawley_and_the_depression.html
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Fixed. The rest of the word is in love with tariffs.
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