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US Administration announces 34% tariffs on China, 20% on EU

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Re: US Administration announces 34% tariffs on China, 20% on EU

#781

Post by neutronicus »

wat10000 wrote: post #684
lumb63 wrote: post #625

Everyone is quick to deride this move as stupid. I don’t disagree that there are downsides to the approach, but there is a set of very real national problems that this might address. For instance, globalization and offshoring of production has made goods cheaper for consumers, but what about the former domestic producers who could not compete, and do not have the skills or capital to find a new job which pays as well…

Globalization is fine. Wages in this country are quite high overall. Inequality isn't caused by trade, it's caused by low taxes on rich people, weak unions, and weak labor regulation. The terrible state of US production is a myth. The US is the second largest manufacturer in the world. The #1 spot is occupied by a country with over 4x our population. Manufacturing employment is down because our manufacturing producti…

Aren't "weak unions" caused by globalization? Unless the union is global, employers can always respond to stronger unions by pulling the off-shoring lever even more vigorously than they already do.

Re: US Administration announces 34% tariffs on China, 20% on EU

#782

Post by uptownfunk »

What most people don’t see is that we are basically under “shadow austerity” to correct for the not so hyperinflation we saw post COVID.

It is a combination of post WW2 Britain (China is the US in that analogy) - this helps to explain the Canada and Greenland issue; and Volcker era stagflation economics. It will not get any better in the short term, but there is likely to be substantial growth in the long term as a result.

What that means is the fed likely won’t reduce rates, and it may reduce its rate decrease to 1 this year, if even that. It is entirely possible the rate doesn’t come down at all.

Expect Layoffs to come, as the fed doesn’t seem to care about unemployment as its target is on inflation. Many zirp era businesses and funds will fail. Less cereal and eggs for the same dollar.

I am really hoping we don’t start to de-anchor from 2% inflation as a result of all this. I wonder how various US infrastructure projects can and will be financed. Reduction in entitlements. Possibly some type of mandate to hold treasuries.

Re: US Administration announces 34% tariffs on China, 20% on EU

#783

Post by bhouston »

TaurenHunter wrote: post #599

I don't see anyone mentioning that the United States needs to manage its massive national debt, currently in the trillions, by issuing Treasury securities. These securities mature at varying intervals and require continuous "rolling" or refinancing to pay off old debt with new borrowing. Significant rollovers are expected from April through September 2025, with additional short-term maturities due by June. Higher int…

Trump is a wildcard, but I could see the US defaulting on its debt, probably in some way that focuses the default burden on foreign countries holding US debt with some relief for domestic holders. I would definitely not be holding it over the coming few years.

Re: US Administration announces 34% tariffs on China, 20% on EU

#784

Post by [deleted] »

roxolotl wrote: post #479

Aside from everything else one thing what strikes me as particularly insane is how it’s not even defensible as a protective measure. My favorite everyday olive oil comes from Tunisia. They now have a 38% tariff on them. There are no out of work olive farmers in the US. The orange man wanted tariffs, the orange man is going to get tariffs. Now we have to hope the American people aren’t so dumb as to still be convinced…

[deleted]

Re: US Administration announces 34% tariffs on China, 20% on EU

#785

Post by svara »

ajross wrote: post #753
svara wrote: post #750

It's true that free trade is hugely beneficial to the US economy as a whole, particularly with the USD being the reserve currency. The flow of goods is balanced by a flow of US dollars to other countries, which are ultimately cycled back into the US financial system - enabling budget deficits and an abundance of capital to invest in high growth industries. The flip side of this is that it also drives inequality - the…

You're arguing from a steady state. In point of fact the pain of the at-this-point-seemingly-inevitable recession is absolutely going to be concentrated on the working class. Those of us with savings and work flexibility will do just fine. Even someone making a first principles argument for a revision of US trade policy should agree that this is insane.

I think my comment is entirely compatible with what you said, no?

Re: US Administration announces 34% tariffs on China, 20% on EU

#786

Post by SpaceManNabs »

lumb63 wrote: post #625

Everyone is quick to deride this move as stupid. I don’t disagree that there are downsides to the approach, but there is a set of very real national problems that this might address. For instance, globalization and offshoring of production has made goods cheaper for consumers, but what about the former domestic producers who could not compete, and do not have the skills or capital to find a new job which pays as well…

This is a bunch of nonsense that is not driven by data and not even worth a response.

I am tired of people spitting BS just to defend Trump's inane policies and everyone else having to rederive modern economic trade theory in comments in order to counter it.

Physicists used to get a bunch of derision for thinking their high skills in analytical thinking in physics easily carried over to other fields, and now we have CS majors thinking the same.

Regardless I will do some of the countering:

> what about the former domestic producers who could not compete, and do not have the skills or capital to find a new job which pays as well?

We had a candidates that offered job re-training programs. Those candidates weren't selected and those jobs went away even as we tried to put up protectionist domestic policy.

> our society as such is biased heavily toward importing goods rather than exporting goods.

This is fine. Comparative advantages and all. We just need to produce the goods necessary for national security. It worked out well so far. Do we actually want to have other countries do the high value services and us doing the low value manufacturing???? Why are you justifying engaging in a trade war with Cambodia and Vietnam?

> Tariffs accomplish both of those, raising money at the same time as raising cost of goods and weakening the dollar.

This is not backed by any data. Every single economic thinkthank worth a damn, including conservative ones, have detailed how it will raise the national debt.

I am tired of people saying ridiculous arguments just so they can stave off cognitive dissonance.

Tearing down our soft power and throwig out every trade deal we have carefully crafted since WWII is absolutely ridiculous.

Re: US Administration announces 34% tariffs on China, 20% on EU

#787

Post by teovall »

lumb63 wrote: post #625

Everyone is quick to deride this move as stupid. I don’t disagree that there are downsides to the approach, but there is a set of very real national problems that this might address. For instance, globalization and offshoring of production has made goods cheaper for consumers, but what about the former domestic producers who could not compete, and do not have the skills or capital to find a new job which pays as well…

If you really want to onshore production, you don't increase taxes on the import of raw materials, parts, and components, you only do so for finished goods. That isn't what this administration has done though. They say they want to increase domestic manufacturing, but their actions clearly prove that that is not their goal.

Re: US Administration announces 34% tariffs on China, 20% on EU

#788

Post by rtkwe »

jayd16 wrote: post #730
lumb63 wrote: post #625

Everyone is quick to deride this move as stupid. I don’t disagree that there are downsides to the approach, but there is a set of very real national problems that this might address. For instance, globalization and offshoring of production has made goods cheaper for consumers, but what about the former domestic producers who could not compete, and do not have the skills or capital to find a new job which pays as well…

If it's fundamentally a jobs program, you can be a lot smarter about it than tariffs. If companies couldn't compete before, they're now further disincentivized to compete, leaving the rest of us worse off and uncompetitive with the rest of the world. Tariffs are just bad policy.

That's the part I just don't get about the pro tariff as reshoring manufacturing argument. That industry only makes sense and will only be profitable in a world where the tariffs are permanent. The Vietnamese textile factories aren't going to just disappear their exports will shift to other parts of the world and if the tariffs ever disappear they'll shift right back to the US. So you'll have a tiny fragile industry beholden to the government for its continued existence that makes an expensive product only for domestic consumption... Maybe that's the actual goal create a new raft of client industries and workers in that industry who'll support the administration because to not do it will destroy them simply by lifting or easing the tariffs.

Re: US Administration announces 34% tariffs on China, 20% on EU

#790

Post by kacesensitive »

ck2 wrote: post #731
TaurenHunter wrote: post #599

I don't see anyone mentioning that the United States needs to manage its massive national debt, currently in the trillions, by issuing Treasury securities. These securities mature at varying intervals and require continuous "rolling" or refinancing to pay off old debt with new borrowing. Significant rollovers are expected from April through September 2025, with additional short-term maturities due by June. Higher int…

The F-35 jet will cost over $1.5 Trillion, doesn't work and won't be used Cancel it and stop making everyone's daily life absolute hell by doubling the prices of groceries, car payments, etc. every month National Debt is not a problem for a country that will be around for 1000+ years unless you know of something that is going to greatly shorten that. There are nearly 1,000 BILLIONAIRES in the US, the debt is their pr…

A progressive wealth tax starting at 2% on net worth from $50 million to $250 million and increasing to 8% for wealth over $10 billion is projected to raise $4.35 trillion over 10 years.

Seems like a great start to me.

Alas, I'll never understand people who make average wages defending billionaire wealth hoarding.

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