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The Unseen Cost Of Saving Jobs With Tariffs
Investors Business Daily ^ | March 8, 2016 | WALTER E. WILLIAMS

Posted on 03/09/2016 3:43:27 AM PST by expat_panama

...when making laws or economic decisions, it is imperative that we examine not only what is seen but also what is unseen. In other words, examine the whole picture...

...A concrete example was the Bush administration’s 8% to 30% tariffs in 2002 on several types of imported steel. They were levied in an effort to protect jobs in the ailing U.S. steel industry.

Those tariffs caused the domestic price for some steel products, such as hot-rolled steel, to rise by as much as 40%....

...there is no such thing as a free lunch...

...steel-users — such as the U.S. auto industry, its suppliers, heavy construction equipment manufacturers and others — were harmed by higher steel prices.

It is estimated that the steel tariffs caused at least 4,500 job losses in no fewer than 16 states, with more than 19,000 jobs lost in California, 16,000 in Texas and about 10,000 each in Ohio, Michigan and Illinois.

In other words, industries that use steel were forced to pay higher prices...

...back in 2002, the typical hourly wage of a steelworker ranged between $15 and $20, in addition to fringe benefits — so we might be talking about an annual wage package averaging $50,000 to $55,000 — how much sense did it make for American consumers to have to pay $800,000 in higher prices, not to mention lost employment in steel-using industries, to save each job?

It would have been cheaper to tax ourselves and give each of those 1,700 steelworkers a $100,000 annual check...

...When Congress creates a special privilege for some Americans, it must of necessity come at the expense of other Americans...

...Congress ought to get out of the miracle business and leave miracle-making up to God.

(Excerpt) Read more at investors.com ...


TOPICS: Business/Economy; Government; News/Current Events
KEYWORDS: economy; investing; tariffs; walterwilliams
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Comment #201 Removed by Moderator

To: Wpin

I hate to break this to you, but Trump has no “multi-dimensional strategy” at all. He has a series of incoherent, disconnected ideas (depending on the political audience) that would work far better in theory than in practice.


202 posted on 03/10/2016 7:12:04 AM PST by Alberta's Child (Bye bye, William Frawley!)
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To: expat_panama
American workers cost ten times as much per hour as does a worker in Togo, and the reason is that it takes ten hours for the Togon to do what an American can do in one.

Maybe for Togo this is true, but that is not true across the board. If it was, then nobody would ever manufacture something overseas because the productivity differential is proportional but the transportation costs weigh heavily in favor of domestic manufacturing.

More likely, what you have with advanced Asian nations is a scenario where the U.S. worker is 3x more expensive but is only 1.5x more productive. In some cases (and this is getting more common almost by the day), the foreign worker is even MORE productive than the U.S. worker.

203 posted on 03/10/2016 7:15:05 AM PST by Alberta's Child (Bye bye, William Frawley!)
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To: FirstFlaBn

That’s an excellent anecdote. I’m going to “borrow” it for future discussion, if you don’t mind!


204 posted on 03/10/2016 7:16:59 AM PST by Alberta's Child (Bye bye, William Frawley!)
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To: Alberta's Child

“Bill Clinton comes to mind first and foremost”

Al Gore also lied when “he didn’t have to” — all the time. But Cruz makes Clinton and Gore look like pikers when it comes to the lying game.”

Actually he does, but you will never be allowed to see it cause your master does not want you to know the truth. Go on and keep drinking the Cruz kool aid...but, know this...when Cruz says his constant lies they are for you personally...not for me or Trump but for Cruz supporters because more and more are seeing exactly who he is and we find him despicable.


205 posted on 03/10/2016 7:18:53 AM PST by Wpin ("I Have Sworn Upon the Altar of God eternal hostility against every form of tyranny...")
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To: central_va
You can't have a conversation with them because they cannot fathom that protectionism actually works and is a viable form of economic policy, a policy that created the USA's manufacturing base in the first place.

Maybe "protectionism" created the USA's manufacturing base, but what made us the most dominant industrial power in the world was this minor historical event called World War II that decimated all of the other major industrial nations in the world.

Most of what people remember as the height of U.S. manufacturing dominance was nothing more than a historical anomaly tied to these events.

206 posted on 03/10/2016 7:21:52 AM PST by Alberta's Child (Bye bye, William Frawley!)
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To: Alberta's Child
World War II that decimated all of the other major industrial nations in the world.

Another falsehood. The main threat to manufacturing in the USA is from Asia and Mexico. With exception of Japan, India, Indonesia, Vietnam, China, Thailand and Korea were industrial midgets up to 1980. We shipped our factories to them. World War II had nothing to do with it.You're not intelligent enough to rewrite history. That takes a Limbaugh.

207 posted on 03/10/2016 8:05:28 AM PST by central_va (I won't be reconstructed and I do not give a damn.)
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To: Alberta's Child

What a stupid answer. The answer is not every decision in life is made based on economics.


208 posted on 03/10/2016 8:07:26 AM PST by central_va (I won't be reconstructed and I do not give a damn.)
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To: central_va
I don't know what kind of history you've read, but I do know that U.S. manufacturing was already in a steep decline by 1980.

By 1980, the biggest threat to U.S. manufacturing was U.S. manufacturers. The Big Three U.S. companies, for example, were building complete pieces of sh!t by that time. Ford, GM and Chrysler were the best sales force Toyota and Honda could have dreamed of.

In the last 30+ years, much of the growth in manufacturing in places like Indonesia, Korea, Vietnam, and Thailand has been at the expense of other Asian manufacturing centers (Taiwan, Japan and even China).

209 posted on 03/10/2016 8:19:19 AM PST by Alberta's Child (Bye bye, William Frawley!)
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To: central_va

Then why are you so pathologically concerned about U.S. trade policy?


210 posted on 03/10/2016 8:20:04 AM PST by Alberta's Child (Bye bye, William Frawley!)
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To: central_va
It's also worth noting that most of the discussions about trade policy these days involve examples that have no relevance to the underlying points that are being made.

Think of Apple, for example -- a company that is a common "bad guy" in these discussions because they manufacture most of their products in Asia. Apple never moved any U.S. jobs overseas. The products they make today didn't exist even ten years ago. They never manufactured them in the U.S. in the first place.

That's just one example that you can replicate thousands of times in almost every manufacturing sector -- especially in computers, telecommunications and other technology-based products.

211 posted on 03/10/2016 8:25:44 AM PST by Alberta's Child (Bye bye, William Frawley!)
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To: Wpin
It isn’t a matter of defending myself...I don’t need to I am right.

You won't defend your nonsense, or you can't? Like Trump, do you believe that the trade deficit represents lost cash and serves as a deadweight loss on the economy? Trump obviously doesn't know the first thing about the balance of payments. Do you?

It's instructive that you believe that the freedom to trade is responsible for crumbling cities and lost industries rather than lame brained leftist policies focused on onerous regulations, punitive taxation, and trial lawyer run amok. Yeah, freedom killed those cities and industries rather than the ills of liberalism and the creative destruction that is so important to a competitive economy. You sound like a liberal pleading with the public that with just a little more government these wrongs can be righted. This is the same kind of thinking that causes people to believe that government can create a level playing field or fair trade. The only form of fair trade is free trade.

Trump will return America to prosperity

But will he make the trains run on time? What a contrast, your idol worship vs. Reagan telling us that the American people will make America great again. Another eight years of a narcissist/populist. What could possibly go wrong? Will he also heal the planet and stop the seas from rising?

I only hope Trump, along with his acolytes, come to realize at some point that it isn't the freedom to trade that causes the problems you cite, but anti-growth and anti-capitalist policies from government. Trump is clearly flexible on every issue so let's hope he hires and then listens to some people who actually understand economics and that solving the problems requires less government, not more.

212 posted on 03/10/2016 9:17:15 AM PST by Mase (Save me from the people who would save me from myself!)
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To: dennisw

Try not to speak.


213 posted on 03/10/2016 9:19:44 AM PST by Mase (Save me from the people who would save me from myself!)
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To: expat_panama; Wpin; central_va
It's a NYT piece(grain of salt/truth), but kind of related to the thread topic U.S. Imposes Steep Tariffs on Chinese Solar Panels
214 posted on 03/10/2016 9:19:57 AM PST by RckyRaCoCo (Political Correctness is a kool-aid drinking suicide cult)
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To: expat_panama

For later. Thanks


215 posted on 03/10/2016 9:41:16 AM PST by ResisTyr ("Resistance to tyrants is obedience to God " ~Thomas Jefferson)
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To: Mase

“It’s instructive that you believe that the freedom to trade is responsible for crumbling cities and lost industries rather than lame brained leftist policies focused on onerous regulations, punitive taxation, and trial lawyer run amok. “

Here right there above shows how stupid you really are. You just take a one dimensional view of everything because you are not intelligent or experienced enough to view the world as it is. I have stated that this is a multi-dimensional problem you simply agree with one part at a time, except in terms of trade. You dogmatically (support without evidence) that we have free trade when we do not. The other nations are granted free trade...our employers do not enjoy that. Hell yes, the combination of factors have decimated the labor market in the US. Listen dummy, try to actually read up on this subject before writing here. Your ignorance shows...but then again it never ceases to amaze me how proud some are of their ignorance...


216 posted on 03/10/2016 9:58:25 AM PST by Wpin ("I Have Sworn Upon the Altar of God eternal hostility against every form of tyranny...")
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To: Mase

I have you free traitors down as Hillary voters this November.


217 posted on 03/10/2016 10:16:32 AM PST by dennisw (The first principle is to find out who you are then you can achieve anything -- Buddhist monk)
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To: Wpin
Right. I'm stupid but you and Trump think our trade deficit is lost cash to whatever country we have a trade deficit with. I have a huge current account deficit with my grocery store. Is that stupid trade as well, or are you and Trump just stupid? Now, I could save a lot of money by shopping at Wal-Mart but that's an awful experience so I go to Publix, and pay more, instead. Would you and Trump force me to use a supplier of your choice rather than allow me to make my own choices?

If you buy what Trump is selling on trade you're a complete fool and an economic moron. First, Trump's plans are an incoherent mess of half baked ideas and ever changing thought designed to appeal to people who don't know any better. To claim here that he has a strategy for making our trade agreements better is laughable. Second, to pretend that you have some idea of what you're talking about here, when you don't even know the difference between a current account deficit and a capital account surplus, and why that isn't bad for us, makes you uniquely unqualified to be hectoring anyone about the topic.

Yeah, you have a multi-dimensional view of the economy but can't explain how that translates into a strategy for making it so we get tired of winning. Great. I'm sure you're nuanced as well. Trump will make us great again, not the people. Greatness flows from the leader down, not the other way.

Free(r) trade should always be the goal. Mindlessly whining about the need for "fair trade" - whatever the hell that really means to you - is nothing more than wanting government to come in and pick winners and losers. Only someone with no understanding of how a capitalist economy should work would drone on about the need for a level playing field. Pollyannaish nonsense is nice, but it shows a true inability to see the world for what it is. Good luck with that. Hopefully, you work in the public sector where feelings are more important than facts and results.

218 posted on 03/10/2016 10:25:46 AM PST by Mase (Save me from the people who would save me from myself!)
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