Posted on 08/26/2015 5:47:02 PM PDT by WilliamIII
Here's a historical fact that Donald Trump, and many voters attracted to him, may not know: The last American president who was a trade protectionist was Republican Herbert Hoover.
Does Trump aspire to be a 21st century Hoover with a modernized platform of the 1930 Smoot-Hawley tariff that helped send the U.S. and world economy into a decade-long depression and a collapse of the banking system?
(Excerpt) Read more at cnbc.com ...
If other countries shut the US out of their markets the US has to respond. Ask Cisco how free China is with Huawei as competition.
Actually I believe they were import quotas but the effect was the same.
Free trade is an ideal, but few countries practice it other than the US , and we can longer afford to have the world free load off us.
Reagan saved Harly-Davidson with a Tarriff on cheap Japanese Bikes.
Yes, and all capital investments should be deductible in the year they are made.
I'll sound stupid saying this, but I don't get it.
Now Mark isn't an economist so it's possible that he's easily influenced by Kudlow, who isn't an economist either, although he plays one on TV. "Kuddles" got his bachelors in history at college where he also majored in leftwing SDS politics. So before you join the Kudlow-Levin lemming rush over the tariff cliff keep a few things in mind.
The Smoot Hawley tariff debate began in Congress in Spring of 1929 when Herbert Hoover took office. That Fall the stock market crashed (Black Friday) and the Depression began. Smoot Hawley was still being debated. Congress recessed, the Depression deepened, and yet Smoot Hawley still didn't become law until June of 1930.
Now you don't need to be an economist to figure out what came first, The Depression, or the Smoot Hawley Tariff. All you have to do is look at a calendar.
So, you say, maybe Smoot Hawley didn't cause the Great Depression, but it made it a whole lot longer and worse. Because tariffs are bad per se. Right?
Well Smoot Hawley wasn't the first tariff during the 1920s. It was the third, the third in a decade remembered as The Roaring Twenties. The Fordney-McComber tariff was a high tariff and it went into effect in 1922. The Depression didn't start when it passed. The Twenties roared.
In the 1920s foreign trade accounted for something like 6% of GNP. Not a lot. We made virtually everything we consumed outside of bananas and coffee. Tariffs may have reduced or altered trade, and hurt some and benefited others, but they didn't kill the economy.
Kudlow talks like our trade imbalanced driven economy is currently doing fine.
Finance and economics are two totally different things.
“Shipping our manufacturing jobs to foreign countries is not fine and not desirable.”
Well that’s labor arbitrage anyway, although the usual suspects will keep insisting it’s free trade.
“Careful and pathbreaking research by Milton Friedman showed that the fault lay with the Federal Reserve system’s mistaken monetary policy.”
Well he and Anna Schwartz said it was the Fed’s failure to act, a paralysis made worse because their leader died on the eve of the Depression and they couldn’t decide what to do. So they stood pat as thousands of banks failed with a resulting collapse of the money supply.
One third of American banks failed 1930-33 and one third of the money supply simply evaporated. Depositors were wiped out too because we had no FDIC at that time; Friedman called the creation of the FDIC the most important legislation to come out of the Depression.
Bernanke was a student of Friedman and Schwartz’s study of “The Great Contraction” and was worried that the collapse of the housing bubble could take the banking system down with it, in a replay of the 1930s. TARP and some other policies were intended to keep banks from going bankrupt as mortgage paper defaulted.
“In 1970—still a Democrat—Kudlow joined Joseph Duffey’s “New Politics” senatorial campaign in Connecticut. Duffey was a leading anti-war politician during the Vietnam war era. Kudlow, working with Yale University student Bill Clinton as well as many other rising young Democratic students, was known as a “brilliant” district coordinator.
“Kudlow worked on the U.S. Senate campaign of Joseph Duffey, along with Bill Clinton, John Podesta, and Michael Medved, another future conservative, and in 1976 he worked on the U.S. Senate campaign of Daniel Patrick Moynihan, along with Tim Russert, against Conservative Party incumbent James L. Buckley, brother of William F. Buckley, Jr.”
https://en.wikipedia.org/wiki/Lawrence_Kudlow
Putting aside Fair Tax for a minute, I can’t see trading with enemy countries, like Red China.
However, I’m not against Free Trade with FREE countries.
there are always outlier cases....and any reasonable person is open to that...like Reagan, but he was clearly in favor of free and open trade in general.
Name one.
That would make Trump a Marxist. Not very likely.
Get in touch with your economic-totalitarian side and call them “enemies of the state.” Then send them off to the Gulag.
Most people critical of Trump haven’t spent the time listening to the words coming directly out of his mouth.
The POTUS does not write actual legislation, he can propose it but some lonely Congressman most take up the cause when it comes to spending money on new things and if no one in Congress does then the POTUS can stand around and complain but that is about it unless he can get his goal accomplished by ordering a FEDERAL AGENCY to do the deed.
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