Posted on 04/10/2025 4:15:07 AM PDT by MtnClimber
VDH ping
bkmk
“50 years ago this weekend the Government announced that the pound would be devalued by 14%. This decision – previously politically unthinkable – was taken after fending off a number of earlier currency crises.”
“Chancellor James Callaghan released a statement at 9.30pm on Saturday 18 November 1967 stating that the Government had decided to lower the exchange rate from $2.80 to $2.40 per £1, a 14.3% change. Interest rates were raised from 6.5% to 8.0%, cuts to defence budget announced, and banks and the stock exchanges would be closed on Monday.”
“Prime Minister Harold Wilson gave an address on TV and radio to the nation....He railed at the “successive waves of speculation against sterling”, and said no international loan could be agreed given the conditions on economic policy that may be attached to them.”
https://commonslibrary.parliament.uk/pound-in-your-pocket-devaluation-50-years-on/
Remember a 14% devaluation has a greater impact than a tariff increase to 10%.
Watch Season 3 of “The Crown” to see why trade deficits matter.
Very good. A must read.
It needs to be understood that the issue is less about fairness and stuff and more about US governmental and international cash flow.
We are going to be creating a new Bretton Woods system.
Tariffs and import restrictions are part of that.
Allocating garment production quotas will allow developing countries to actually develop and pay for drugs and food instead of USAID.
“Is the United States uniquely brilliant in maintaining a half-century of cumulative trade deficits? Do Americans alone discover the advantages of a $1 trillion annual trade deficit and small or nonexistent tariffs?”
The US sells capital assets to foreigners that appreciate in value in real terms, i.e. Apple stock, California real estate, copyright owning companies, etc.
The US is not alone, the UK sells prime London real estate.
The problems with selling real estate at ever increasing real pricing is that locals are getting priced out onto the sidewalks and pavement and government housing subsidies are increasing.
As for Apple, China wants Huawei to supplant Apple.
As for copyright owning companies, we’ve pretty much sold them all off to Europeans and Japanese. Disney is the only major exception that comes to mind, and it is not doing well.
The Chinese are still willing to take dollars because they like to make lopsided deals with Third World countries to grab their assets using those dollars.
This is possible due to Third World corruption, past loan defaults and lack of domestic capital.
We need to decide what we want our economy to look like.
Don’t expect millions Americans to industrially sew. Sewing can done much cheaper elsewhere and poor countries need a sewn good export ability so they can buy American drugs and medical equipment.
Once we have made our plans, we can publish them and then make deals compatible with our plans.
Americans generally love imports, but our exports are insufficient to pay for them all.
Stuff we can make almost as cheaply as any country can needs to be made in the USA so we can import a maximal amount of stuff that has been made at much lower cost than is possible in the USA.
Free Traitors™ make me so sick, they make every patriot sick. Free Traitors™ better hope their is not a real hot war with China. Free Traitors™ have no where to hide,the reckoning will be very bad.
The next person I meet who thinks that was a great time in modern American history will be the FIRST person I’ve ever met who believes this.
Brian: I would be curious to know how you think influences like automation and low energy costs would weigh into any trade policy you’d consider. Are we looking to maximize productivity or maximize employment?
Trick question.
You left out quality and re-creation of industries necessary for the US to be economically self-sufficient.
Victor Davis Hanson
One of the few adults on planet Earth.
He is always right.
Very annoying to those always wrong.
The problems of 1979 had nothg to do with manufacturing. The problem was the sell out pols and bidness traitors.
Those of us needing to buy aluminum didn’t know how much the price in the afternoon would be higher than it was in the morning
If there soon is a rush of nations to cut a deal with the U.S. and not to be left out of the American market, will there follow another hysterical Wall Street spasm—but not to sell, but instead to buy stocks at bargain prices?
FR Index of his articles: Victor Davis Hanson on FR
Town Hall: Victor Davis Hanson on Town Hall
American Greatness: Victor Davis Hanson on American Greatness
His website: Victor Davis Hanson
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So? Not my problem. Buy American aluminun would be my suggestion.
it was American aluminum. Alcoa and Reynolds dominated the production back then
I respectfully disagree. I don't think you realize the full potential of drill baby drill and mine baby mine. A huge part of the calculation of our trade deficit is energy. If we go back to being a net energy exporter, we bigly reduce our trade deficit.
The tariffs might be based on:
1. product necessity
a. total tariff of 0% drug, raw material other than aluminum alloys, automotive grade ferrous metal,
b. industrial level component of product with no domestic source on reasonable and realistic offer,
total tariff of 2% going to 10% by 2% per year every January 1,
c. base tariff of 10%, other product, or
d. base tariff 10%, any service,
2. industry wage shortfall of source country compared to the USA,
addition of 0-20%, 2% per dollar as estimated by the Secretary of Commerce,
levied only if country is industrially advanced,
3. latest 12-month US<->international cash flow US shortfall as to be estimated by the Secretary of Commerce,
addition by percent,
a. 0-10% if source country is industrially advanced,
b. 0-5% other source country,
4. latest 12-month US<->source country cash flow US shortfall as to be estimated by Secretary of Commerce,
addition by percent,
a. 0-10% source country is industrially advanced,
b. 0-5% other source country,
5. 12-month US<->foreign exchange rate change, as to be computed at least annually by the Secretary of Commerce,
a. as favorable to source country, proportional addition by up to 5%,
b. as unfavorable to source country, proportional decrease by up to 5%, but to not less than 10% tariff,
6. domestic producer profitability, by industry, with profitability goal of 10%,
a. product or service is clearly Third World produced and exempted by treaty and US law, 0% addition,
b. other product or service,
I. no domestic producer of product or service type, 10% addition,
II. profitability of less than 10%, addition of percentage less than 10%,
III. profitability in excess above 10%, reduction by percentage exceeding 10%, but to not less than 10% tariff.
For tariff purposes, a country is to be considered industrially advanced if it:
1. exports vehicles sold in the USA, other than motorcycles, which can be driven on a federal interstate highway,
2. produces an aircraft, or more than 10% of an aircraft by value, when such aircraft is certified by the FAA,
3. enriches uranium,
4. produces weapons for export to the USA which had a listed import value in excess of $100 million
in a prior 12-month period less than 24 months past,
5. is considered as such by the Secretary of Commerce for reasonable cause.
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