Showing posts with label trade. Show all posts
Showing posts with label trade. Show all posts

Sunday, July 15, 2018

Imposing tariffs is like shooting ourselves in both feet at once

From Senator Lamar Alexander - The administration has imposed tariffs on aluminum and steel and now other products, including soybeans and other products grown and manufactured in our country. In general, these tariffs are a big mistake. I have urged President Trump instead to focus on reciprocity. Tell other countries “do for our country what we do for you.” I've worked for 40 years to bring the auto industry to Tennessee. It has done more than anything to raise our standard of living and to raise family incomes in our state. Tariffs will lower our standard of living and will hurt Tennessee more than almost any other state. 

 I've said to the president as respectfully and as effectively as I can, “Mr. President, we agree on taxes. We agree on regulations. We agree on judges. We're proud of having the best economy in 18 years, the lowest employment rate that anybody else can remember, but these tariffs are a big mistake. They will take us in the wrong direction.” I have not been successful in talking with the president about this, but I intend to keep trying. There are other and better ways to persuade our trading partners to do for us what we do for them instead of shooting ourselves in both feet at once, which is what we do when we impose these tariffs. 

Rod's Comment: I agree. I appreciate Lamar taking a strong position opposing Trumps foolish policy on trade. Congress should reclaim the authority to set tariffs.

Stumble Upon Toolbar
My Zimbio
Top Stories

Sunday, July 08, 2018

Time's Up For Farmers As Trump Trade War Begin

News Channel 5 - Farmers across the State of Tennessee woke up to a new economic reality on Friday morning, multi-billion dollar Chinese tariffs that will likely cripple farmers already on the brink of collapse.  ... For Will Hutchinson, a lifelong farmer in Rutherford County, the tariffs couldn’t have come at a less opportune time. His 70 acres of soybeans are already in the ground.
He estimates the impact of the $34 billion tariff on imported U.S. goods to China, including soybeans, will cost him more than $20,000 this growing season. (For the News Channel 5 video or the text of this story, follow this link.)

Rod's Comment: The Trump Trade War is going to bankrupt farmers as the above story illustrates. It will also add up to $5000 to the cost of new cars and pickup trucks, and increase the price of many things we buy. Even the craft beer brewing industry will be hurt, Craft brewers have to have steel kegs and aluminum cans and with the ban on imported steel and aluminum. steel kegs and aluminum cans will cost more. Small emerging craft brewers operate on a small margin and cannot compete with established firms with these higher prices. Jack Daniel and Harley-Davidson will see a decrease in exports.

While there will be some winners, such as steel workers who may be put back to work, there promises to be many more losers. Losers will include consumers who will pay more for numerous goods. Also, however, will be American workers who will be thrown out of work. Farmers who can't sell their soybeans will be forced into bankruptcy.  With increased prices, some consumer will simply delay or forgo a purchase and those who work in the auto sector, for instance, may face layoffs. For those consumers who don't let the $5000 higher price of a new car deter them, then they will  have $5000 less to spend elsewhere or to save. Money not spend elsewhere means that other producers and sellers of goods are hurt. Money not saved makes borrowing more costly and dries up money available for investment.

It is time for Republicans to stand up to Trump and resist this ill-advised trade war. A tariff is a tax paid not by foreigners who export goods to America, but by the American consumer. The Trump Trade War is likely to undo the good done by the recent tax cut and Trump's regulatory reform. It is time to end this trade war now before it does serious harm.

Stumble Upon Toolbar
My Zimbio
Top Stories

Friday, June 29, 2018

Marsha Blackburn breaks with President Trump over tariffs.

Marsha Blackburn
by Rod Williams - Representative Marsha Blackburn has been one of Trumps staunches supporters. She often appears on national TV defending the President's policies.  I was pleased to see her break with Trump over the issue of tariffs.

Yesterday she said President Donald Trump's administration should reconsider broad tariffs to avoid unintended negative consequences on Tennessee's economy and workers. In a letter to Commerce Secretary Wilbur Ross she said Tennesseans stand to suffer disproportionate and negative consequences under broad tariffs. She said Tennessee industries, including automotive, agriculture and distilled spirits could be hurt by retaliatory tariffs.  The letter was also signed by Republican Reps. Phil Roe, Scott DesJarlais and Chuck Fleischmann.

Senators Bob Corker and Lama Alexander have been outspoken in opposition to Trump's start of a trade way.  I am pleased to see Republicans take a stand for common sense. Trump's trade war could have disastrous consequences and lead to a world-wide economic depression. Even if the trade war does not escalate into a world-wide trade war it could still reverse the recent economic gains resulting from the recently passed tax cuts and cause Republicans to be badly beaten in the mid-term elections.


Stumble Upon Toolbar
My Zimbio
Top Stories

Monday, March 05, 2018

Tariffs Are Taxes

By Larry Kudlow , Arthur B. Laffer & Stephen Moor, National Review - One of the ironies of trade protectionism is that tariffs and import quotas are what we do to ourselves in times of peace and what foreign nations do to u‎s with blockades to keep imports from entering our country in times of war.

Or consider that we impose sanctions on U.S. enemies such as North Korea, Russia, and Iran because we want them to feel the economic pain of being deprived of imports.

But now we are imposing sanctions on our own country, putting up tariffs supposedly to make Americans more prosperous.  If ever there were a crisis of logic, this is it.

Tariffs are really tax hikes. Since so many of the things American consumers buy today are made of steel or aluminum, a 25 percent tariff on these commodities may get passed on to consumers at the cash register. This is a regressive tax on low-income families.

Meanwhile, up to 5 million jobs will be put in harm’s way. And if U.S. steel-and-aluminum-using industries sell less to foreigners, the trade deficit goes up, not down. (keep reading)

Stumble Upon Toolbar
My Zimbio
Top Stories

Saturday, February 17, 2018

Dave Chappelle understands trade better than Donald Trump



In a recent comedy routine, Dave Chappelle summarized President Trump’s position on trade relations with China by saying, “I’m gonna go to China, and I’m gonna get these jobs from China and bring ‘em back to America.” Chappelle then replied, “For what, so iPhones can be $9,000? Leave that job in China where it belongs … I wanna wear Nikes, I don’t wanna make those things. Stop trying to give us Chinese jobs.” Dave Chappelle gets it.

While initially being a "never Trumper," I have warmed to Trump. His appointment of Neil Gorsuch to the Supreme Court and his appointees of other conservatives to the judiciary, the passage of pro-growth tax cuts, the defeat of ISIS, and his slashing of Obama era regulations are the accomplishments which are at the forefront of my reason for warming to Trump. I still have reservations about Trump, however. His demeanor and his lack of ideological commitment to conservative orthodoxy concerns me. While I am beginning to think that Trump's anti-trade rhetoric may be more posturing than real and while I am pleased that he has not started an international trade war, it is dangerous however to spread ignorance about the benefits of trade.

While I am supportive of combating currency manipulators and theft of intellectual property, the benefits of trade should not be ignored and trade should not be demonized. I do not want to grow my own food, and make my own shoes, and build my own house, and make my own car. Trade increases one's standard of living. The same principle that applies to trade in general, also, applies to international trade. If we are better at marketing a product, financing a product, delivering a product and retailing a product than making the product, let people in some other country make it and we will do the rest. To require than products be American-made may cost more jobs than it saves. As an example, if we say all steel used in construction of an American oil pipeline must be made in America, we may be able to build fewer pipelines due to the higher cost of American steel than we could if we imported steel. The few jobs saved by insisted on "American-made" may be fewer than the jobs lost due to the higher construction cost.

A bad thing that has resulted from Trump's anti-trade rhetoric is that many people who think of themselves as conservatives now process an anti-trade mentality.  On the other hand, a good thing resulting from Trump's anti-trade rhetoric is that Democrats, who were the party captured by unionist who always take a  knee-jerk anti-trade position, are so anti-Trump that they now are pro-free trade. Maybe, on balance, the cause of free-trade comes out ahead. In any event it is reassuring to hear a popular figure like Dave Chappelle explain the benefits of free-trade. 

Stumble Upon Toolbar
My Zimbio
Top Stories

Sunday, October 16, 2016

America prospers when we compete globally


From Evan McMullin - American businesses export more than $2.2 trillion per year of goods and services. The demand for American exports supported 11.5 million jobs, an increase of more than 50 percent over the past 20 years. On average, these jobs pay 18 percent more than jobs that are unrelated to exports. For all these reasons, Evan believes that trade is an engine of prosperity and that well-designed trade agreements can help our economy grow even more.

At the same time, we can do more to help American workers adjust and thrive in the 21st century. Since 2000, the U.S. economy has lost 5 million manufacturing jobs, although more than 12 million Americans still work at factories. The main driver of this trend is advanced technology, especially advances in robotics and computing. Today, U.S. automakers produce just as many cars as they did 20 years ago, yet the auto industry employs 300,000 fewer workers, a reduction of almost 25 percent.
Therefore, Evan believes that one of the most important ways to help American workers is to make education more affordable while supporting the growth of technical schools, online education, and work-based training programs. It is essential to support these alternatives to the typical full-time four-year degree program, which may not be a good fit for older students who need to work and support their families while studying. While U.S. factories have cut millions of jobs for those with a high school education or less, hiring of college graduates remains stable, while hiring of those with graduate degrees continues to demonstrate strong growth.

Around the globe—even in China—manufacturing employment is shrinking rapidly as factories rely more and more on advanced technology. Thus, using tariffs to raise the cost of Chinese imports won’t bring those jobs back to the United States. In fact, it will kill American jobs, because China and others will block U.S. exports, which now support more than 11 million jobs.

In addition, raising the cost of imports will force hard-pressed American families to pay hundreds or thousands of dollars more each year for basic necessities, from clothing to pots and pans and diapers. The very same families who may be suffering because of lost manufacturing jobs will now be pushed closer to poverty if Donald Trump pushes through his agenda.

TPP and Other Trade Agreements

Evan supports the Trans-Pacific Partnership (TPP), a trade agreement recently signed by 12 countries, including Japan, Australia, and Vietnam. The TPP will eliminate tariffs for all the countries that sign, but it will not go into effect until ratified by Congress, which must vote ‘yes’ or ‘no’ without making any changes to the agreement.

One of the biggest advantages of the TPP is that reducing tariffs to zero favors American companies. Right now, America has low tariffs, not far above zero. In contrast, other countries’ tariffs will plunge when the TPP goes into effect, opening up their markets to U.S. exports. TPP is still a good deal for those countries, because it gives them better access to the biggest market in the world (ours) and the third biggest (Japan).

TPP also helps create a level playing field between U.S. workers and their counterparts overseas. If foreign companies lower their costs by mistreating workers and polluting the environment, then its puts American companies at an unfair disadvantage. However, TPP has the strongest protections for labor and the environment of any major trade deal. That is one of the reasons that Hillary Clinton described it as the “gold standard” of trade agreements. Although nothing has changed about the deal since Clinton praised it so highly, she has turned against the deal for purely political reasons, again displaying a characteristic lack of integrity.

Donald Trump opposes TPP, yet he has made millions by selling suits made in Mexico and ties made in China. He is a candidate who puts his bank account ahead of his principles, something he also did when used illegal immigrants to build Trump Tower – and cheated them out of their salaries. He is too wealthy and self-interested to have any concern about how a trade war will destroy U.S. jobs or raise the cost of living.

Finally, TPP is important for national security reasons. Our allies in Asia are watching to see whether the U.S. still has the ability to set the rules of the road, or whether their security depends on submitting to China. That is why the secretary of defense has said, “TPP is as important to me as another aircraft carrier.” If the U.S. abandons TPP, China is likely to intensify its campaign of intimidation in the South China Sea. Thus, support for TPP is a win-win proposition; it enhances our security and reinforces the growth of job-creating American export industries.

Stumble Upon Toolbar
My Zimbio
Top Stories

Monday, February 02, 2009

Please Don't "Buy Ameican"

The only thing missing in turning this economic downturn into a full-blown worldwide depression is a good dose of protectionism and a massive trade war. Unfortunately it looks like it is on the way. In casual conversation, in chat groups, blogs, and in songs on country radio the “buy American” sentiment is expressed. Both grassroots liberals and conservatives are calling for requirements that money appropriated in the stimulus bill be restricted to projects that only use only American made products in their spending projects. Protectionist sentiment seems to be growing by leaps and bounds.

If the Democratic super spending bill really was a good economic stimulus bill and was devoid of all the pet projects and pork in the bill, it would still be a bad bill because of the “buy American” provisions in the bill. The last thing we need is a trade war. If we mandate “buy American” we can expect other countries to retaliate. If we stop buying Chinese goods the Chinese very well may decide to stop buying our debt.

Almost all historians agree that a major cause of the Great Depression was protectionism and the trade wars. The Depression began in 1929 with the stock market crash. The depth of the depression however did not occur until 1932. In 1930 Congress passed the Smoot Hawley Tariff Act, which raised tariffs on over 20,000 imported goods. This act was thought to be a job creation bill, the reasoning being that if we did not purchase all of those goods from foreign countries that Americans would be put to work producing those goods. As soon as the bill was passed foreign countries began boycotting American goods and passing retaliatory tariffs on imports. American farmers could no longer export their goods. We did not pull out of the depression until 1939 with the outbreak of World War II.

In addition to causing other countries to retaliate against American goods, “buy American” also creates other inefficiencies that cause job losses. Writing in an op-ed piece in the New York Times, Douglas Irwin offers an example to demonstrate why this is so:

In rebuilding the San Francisco-Oakland Bay Bridge in the 1990s, the California transit authority complied with state rules mandating the use of domestic steel unless it was at least 25 percent more expensive than imported steel. A domestic bid came in at 23 percent above the foreign bid, and so the more expensive American steel had to be used. Because of the large amount of steel used in the project, California taxpayers had to pay a whopping $400 million more for the bridge. While this is a windfall for a lucky steel company, steel production is capital intensive, and the rule makes less money available for other construction projects that can employ many more workers. (If We Buy American, No One Else Will)
I know it sounds patriotic and rational to “buy American.” It is not. The world is much more interdependent now than it was in 1930. If we start a massive trade war, it is guaranteed to push us into a full-blown Depression that may last for a very long time. I hope that the wiser heads in Congress and the Obama administration resist the growing public demand for protectionism. Please don’t get caught up in the “buy American” feeding frenzy. It is economic suicide.

Stumble Upon Toolbar
My Zimbio
Top Stories

Tuesday, July 15, 2008

Budweiser Sold to Belgian Company

And I Don't Care.

Stumble Upon Toolbar
My Zimbio
Top Stories

Saturday, August 04, 2007

Only Trade Can Solve Global Poverty

By Peter Lilley
Telegraph Co. UK.
July 24, 2007

"Even if the rich countries fulfil their pledges to increase aid, the total amount will still be inadequate to finance all the health, education, nutrition, water and sanitation that people living on the edge of survival need.
Above all, they need economic growth to boost their incomes. And trade is the great dynamo of growth."
"When millions of children go to bed hungry and we can do something about it, we cannot pass by on the other side of the world. And poverty affects our security and prosperity as well as our humanity." (to continue: Only Trade...)

In this article, Peter Lilley who chairs the Conservatives' globalisation and global poverty policy group, ask us to face the truth about the massive corruption and inefficiency in many third world countries and argues that foreign aid alone will never be sufficient to make a significant difference in world poverty.

Unfortunately, it is often those who profess to care the most about the world's poor that advocate policies guaranteed to keep them poor. The opponents of globalization would rather let the poor of the world starve than see them participate in the world economy. The truth is that greed and enlightened self-interest will lift more people out of poverty than all the philanthropy in the world. Rod

Stumble Upon Toolbar
My Zimbio
Top Stories