Legaltitan

Trade War - how is that working out?

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With all these tariffs, and their harmful effects, the good news is at least they have dramatically decreased our trade deficit.

 

Oh wait actually the opposite of that has happened:

 

https://www.reuters.com/article/us-usa-economy-trade/u-s-trade-deficit-jumps-to-10-year-high-in-2018-idUSKCN1QN1M4

Quote

The Commerce Department said Wednesday that -- despite more than two years of President Trump’s “America First” policies -- the United States last year posted a $891.2 billion merchandise trade deficit, the largest in the nation’s 243-year history.

The trade gap with China also hit a record $419 billion, underscoring the stakes for the president’s bid to reach a deal with Chinese President Xi Jinping as soon as this month.

The department’s final 2018 trade report, which was delayed by the government shutdown, showed that the U.S. bought far more in foreign goods than it sold to customers in Europe, Asia, North America and Africa. The goods shortfall topped the 2006 record of $838.3 billion, set as the housing bubble was peaking, and marked the third consecutive year of rising deficits.

A broader measure of the nation’s trade performance, which includes the services sector, showed a narrower, but still large $621 billion deficit. That reflected a deterioration of more than $100 billion from the figure that Trump inherited from President Barack Obama.

 

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So let me get this right.  Trump puts a tariff on some other countries stuff.  The imports from that country go up (we buy more anyway).  Doesn't that mean the US is getting additional tariff revenue?  Socialist dream.... right.  Or doesn't that also mean the economy is so damn good compared to a couple of years ago Americans are buying more goods both here and aboard (prices abroad might still be favorable even with the tariff).  What Trump "inherited" from Obama was poverty, high unemployment (especially for minorities), people on food stamps, and limited economic activity.  As if Obama was somehow orchestrating the great economy and trade numbers we had.  Obama couldn't run a gas station profitably.   

 

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I don't like tariffs.  As in when another country applies them to our products it pisses me off.  Now the mentally deranged view is thinking we have free trade even when tariffs are being applied to us.  As in we should just bend over and take it like a good American.  Level the playing field and have true free trade is the objective.  That seems to be the game plan.  Now if we were in a recession and unemployment was high it wouldn't be as opportune to go after some of these trade agreements.  But right now we can throw dollar values out there but the truth is we have low unemployment and positive growth. 

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12 minutes ago, Soxcat said:

So let me get this right.  Trump puts a tariff on some other countries stuff.  The imports from that country go up (we buy more anyway).  Doesn't that mean the US is getting additional tariff revenue?  Socialist dream.... right.  Or doesn't that also mean the economy is so damn good compared to a couple of years ago Americans are buying more goods both here and aboard (prices abroad might still be favorable even with the tariff)

 

It means businesses that rely on these imports are paying higher taxes.  The opposite of conservative "thought"....right? 

 

14 minutes ago, Soxcat said:

What Trump "inherited" from Obama was poverty, high unemployment (especially for minorities), people on food stamps, and limited economic activity.  As if Obama was somehow orchestrating the great economy and trade numbers we had.  Obama couldn't run a gas station profitably.   

 

A denial of reality, a staple of conservative "thought". 

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It means despite the "higher" tariffs the economy is so good we aren't being hurt right now.  Again, the game plan isn't to make this a permanent thing. 

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3 minutes ago, Soxcat said:

It means despite the "higher" tariffs the economy is so good we aren't being hurt right now.  Again, the game plan isn't to make this a permanent thing. 

Who isn’t being hurt? The farmers are definitely being hurt. The businesses who use aluminum and steel are being hurt. 

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By the way, I wonder if high inflation in the US has been stymied by this combination of trade imbalances and deficit spending. If the US had a trade surplus (or net-zero)  I wonder if we'd actually see devaluation of the dollar. We're basically exporting excess cash that the federal is spending.

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The fx rate of the strong dollar (resulting from interest rate increases throughout 2018) has also blunted the impact of the tariffs.

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Sox I certainly think it is reasonable to conclude that the record trade deficit despite tariffs shows the economy is doing very well.

 

But we can also conclude that the tariffs are not working. The stated reason for the tariffs was to decrease the trade deficit. That has not happened. In fact, it has increased.

 

And I hope you acknowledge that all this money flowing into government coffers is due to a tax on Americans. A tariff is, of course, a tax. And when we impose tariffs, it is Americans, not Chinese or anyone else, who pays these tariffs. 

 

And you are right - increasing taxes to fund the government and at the same time protect domestic industry is indeed a socialist dream.

 

I just want to make sure I'm clear when raising taxes on Americans is good, and when it is bad. When you answered the question about whether you like the tariffs, you were cagey in your response and implied you only dislike them when other countries do it, while leaving yourself wiggle room.

 

So, is it ever a good idea to raise taxes on goods 15-25%? 

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2 minutes ago, Legaltitan said:

So, is it ever a good idea to raise taxes on goods 15-25%? 

OT: I'd argue that's good for legal goods/services that result in a disproportionate negative impact on societal costs, especially healthcare costs -- ie: sin taxes as we see on cigarettes, liquor, even a proposed controversial 'simple sugar' tax on grocery consumables.

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I know farmers in Iowa are getting crushed by this, and more and more starting to turn on this administration.

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28 minutes ago, Omar said:

I know farmers in Iowa are getting crushed by this, and more and more starting to turn on this administration.

This is no joke.  China really played hardball here and in many cases (ex: soybeans) punitively looked to start sourcing from suppliers in other countries rather than just slap reciprocal tariffs on US farm goods.  Trump even made it a point to ask China for relief last week,... to a trade war he started, because they are easy to win,...  Weak.

 

President Donald Trump asked China in a tweet Friday to lift all of its tariffs on American agricultural products, pointing to his decision to delay a second round of tariffs and to improving trade relations with China.

 

"I have asked China to immediately remove all Tariffs on our agricultural products (including beef, pork, etc.) based on the fact that we are moving along nicely with Trade discussions," he tweeted Friday, adding, "and I did not increase their second traunch of Tariffs to 25% on March 1st. This is very important for our great farmers - and me!"

 

Trump had announced the decision to delay the tariffs, as well as a planned summit to wrap up the trade agreement with Chinese President Xi Jinping at Mar-a-Lago, in a tweet Sunday. The tariffs had been set to go into effect Friday if no trade deal were reached. China is the United States' second largest agricultural market, according to data from the Office of the US Trade Representative. US agricultural exports to China hit $20 billion in 2017, with soybeans, the largest sole export, accounting for $12 billion.

 

https://www.cnn.com/2019/03/01/politics/trump-tweets-china-tariffs/index.html

 

Edited by begooode

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