Economic, taxes, and tariffs discussion

[cardboardbox]

I wish a Trump or tariff supporter could explain the thinking behind the tariffs. I have yet to see a real explanation of what it will achieve and why is it fair to our allies. We had a lot of tariffs already, why it is that these new tariffs have upset the status quo so much? Why didnt Turdeau take the offer of no tariffs on either side? If Trump wants to protect domestic steel and aluminum, couldnt we just subsidize them? Isnt that what europe has long done with Airbus? Maybe chancellor could explain this because I'm really interested in the <del>conservative</del> Trumpian viewpoint. Obviously the media has given me plenty of the liberal viewpoint already...

[TranaGreg]

isn't the theory that by taxing imports it's supposed create a stimulus for domestic manufacturing, and all those shuttered steel plants (and other manufacturing plants) across the mid-west will become economically viable again?

[Pauly]

as far as tariffs on China, it is simply leveling the playing field. China has been imposing huge tariffs on American-made products for decades and we all know how China tends to come up with knockoff versions of American made products by stealing intellectual property.

I can see why some think tariffs on all steel, for example, will stimulate both the manufacture and purchase of US steel. The problem is that there simply isnt enough of it right now. I think the idea is to go thru some growing pains while that manufacturing increases.

[B-Fly]

You're asking for the conservative position on tariffs, trade and subsidies. As I understand it, the conservative position is pretty much the exact opposite of the Trump Administration's policies.

https://www.dailywire.com/news/31933/economist-milton-friedman-explains-why-tariffs-are-frank-camp

True conservative economic policy would say that government intervention in the form of tariffs and/or subsidies are anti-free-market and that anti-free-market is ultimately bad.

If I understand the Trump position correctly, giving it its most favorable sheen from a conservative free market perspective, he's basically saying that our trading partners are engaged in interventions including tariffs and subsidies that have been hurting the US, and that his tariffs are retaliatory and aimed at forcing them to deal with us and remove the barriers they've placed on free trade to our detriment. If that is, in fact, Trump's game, then presumably all of the tariffs he's imposing are just temporary leverage to compel our trading partners to drop their interventions, at which time we'd presumably drop ours as well, restoring equitable free trade.

Ultimately, however, I'm not sure I believe Trump has any real intention of promoting free trade and free markets. I think he's looking to shore up support with blue collar American workers who feel like they've been hurt by free trade. Promoting tariffs and/or subsidies in an effort to sustain American businesses and American jobs isn't remotely conservative economic policy in any historical sense, but Trump has decided that it's good politics for him in connection with his grand unifying political ethos - rabid nationalism. Before Bill Clinton, the things Trump is doing on trade would have been associated with the Democratic Party and its promotion of issues on behalf of organized labor, farm subsidies, etc. Bernie Sanders brought skepticism of free trade to his 2016 campaign as well, although with a different tone than Trump's nationalism (America First; we don't win anymore; other countries are laughing at us for letting them take advantage of us)

[cardboardbox]

You're asking for the conservative position on tariffs, trade and subsidies. As I understand it, the conservative position is pretty much the exact opposite of the Trump Administration's policies.

https://www.dailywire.com/news/31933/economist-milton-friedman-explains-why-tariffs-are-frank-camp

True conservative economic policy would say that government intervention in the form of tariffs and/or subsidies are anti-free-market and that anti-free-market is ultimately bad.

If I understand the Trump position correctly, giving it its most favorable sheen from a conservative free market perspective, he's basically saying that our trading partners are engaged in interventions including tariffs and subsidies that have been hurting the US, and that his tariffs are retaliatory and aimed at forcing them to deal with us and remove the barriers they've placed on free trade to our detriment. If that is, in fact, Trump's game, then presumably all of the tariffs he's imposing are just temporary leverage to compel our trading partners to drop their interventions, at which time we'd presumably drop ours as well, restoring equitable free trade.

Ultimately, however, I'm not sure I believe Trump has any real intention of promoting free trade and free markets. I think he's looking to shore up support with blue collar American workers who feel like they've been hurt by free trade. Promoting tariffs and/or subsidies in an effort to sustain American businesses and American jobs isn't remotely conservative economic policy in any historical sense, but Trump has decided that it's good politics for him in connection with his grand unifying political ethos - rabid nationalism. Before Bill Clinton, the things Trump is doing on trade would have been associated with the Democratic Party and its promotion of issues on behalf of organized labor, farm subsidies, etc. Bernie Sanders brought skepticism of free trade to his 2016 campaign as well, although with a different tone than Trump's nationalism (America First; we don't win anymore; other countries are laughing at us for letting them take advantage of us)

you are right, I'm not asking for the conservative position, will edit my post to clarify.

Thanks for trying to explain the Trump position. Do you know if tariffs between us and Canada and our EU allies was about even before Trump? If they had more tariffs than we had then I dont see how they could complain.

[senorsheep]

You're asking for the conservative position on tariffs, trade and subsidies. As I understand it, the conservative position is pretty much the exact opposite of the Trump Administration's policies.

https://www.dailywire.com/news/31933/economist-milton-friedman-explains-why-tariffs-are-frank-camp

True conservative economic policy would say that government intervention in the form of tariffs and/or subsidies are anti-free-market and that anti-free-market is ultimately bad.

If I understand the Trump position correctly, giving it its most favorable sheen from a conservative free market perspective, he's basically saying that our trading partners are engaged in interventions including tariffs and subsidies that have been hurting the US, and that his tariffs are retaliatory and aimed at forcing them to deal with us and remove the barriers they've placed on free trade to our detriment. If that is, in fact, Trump's game, then presumably all of the tariffs he's imposing are just temporary leverage to compel our trading partners to drop their interventions, at which time we'd presumably drop ours as well, restoring equitable free trade.

Ultimately, however, I'm not sure I believe Trump has any real intention of promoting free trade and free markets. I think he's looking to shore up support with blue collar American workers who feel like they've been hurt by free trade. Promoting tariffs and/or subsidies in an effort to sustain American businesses and American jobs isn't remotely conservative economic policy in any historical sense, but Trump has decided that it's good politics for him in connection with his grand unifying political ethos - rabid nationalism. Before Bill Clinton, the things Trump is doing on trade would have been associated with the Democratic Party and its promotion of issues on behalf of organized labor, farm subsidies, etc. Bernie Sanders brought skepticism of free trade to his 2016 campaign as well, although with a different tone than Trump's nationalism (America First; we don't win anymore; other countries are laughing at us for letting them take advantage of us)

I agree with all of this. I don't think he has significant support for this from any quarter, including his own party. As such, I'm guessing he'll wrangle some insignificant concessions from our trade partners, declare victory, and then back off of this very bad idea. At least I hope so - that's the best possible outcome at this point.

[cardboardbox]

I agree with all of this. I don't think he has significant support for this from any quarter, including his own party. As such, I'm guessing he'll wrangle some insignificant concessions from our trade partners, declare victory, and then back off of this very bad idea. At least I hope so - that's the best possible outcome at this point.

when has Trump ever backed off anything? But yes, this would be one of the better outcomes.

Even better would be congress maybe doing something for once and taking away tariff power from the president.

[senorsheep]

when has Trump ever backed off anything? But yes, this would be one of the better outcomes.

Separating families at the border, most recently. I think he can be swayed from his positions when his own party turns on him, and I don't think Republicans are going to have much patience for this as more American businesses get caught in the crossfire.

[In the Corn]

My neighbor works in the steel industry, and I was talking with him over the weekend. He has talking about the tariffs and what it has created in his business. His territory includes Canada. He told me that his Canadian clients are clamoring for order to be filled before the tariff starts in July. His America clients are also after him for steel. He's told the Canadian clients that they are backlogged in supply by about 3 months, so there is little chance to meet the inventory needs before the tariff starts in July.

He said, "I went into my boss and said, 'You might as well call the CEO in right now and have him make a statement about how we're going to handle this. Because we are going to take in the shorts if we can't meet the Canadian demand. We're gonna wind up paying the tariff ourselves to keep the client."

[cardboardbox]

Separating families at the border, most recently. I think he can be swayed from his positions when his own party turns on him, and I don't think Republicans are going to have much patience for this as more American businesses get caught in the crossfire.

I feel like the separating families issue is a bit different but cant figure out exactly how to put it into words at the moment. Trade imbalance and protecting our industry was a campaign promise that I dont think he will back down from. Separating families was a mistake made as he was trying to fulfill the illegal immigration campaign promise. I believe Trump will regroup and take another pass at immigration later. I guess I'm trying to say I dont think he backs down easily from what he really believes in and I dont think he really wanted to separate families.

ugh, its too early to be trying to figure out what goes on in Trump's head. I'm probably not making much sense.

[cardboardbox]

My neighbor works in the steel industry, and I was talking with him over the weekend. He has talking about the tariffs and what it has created in his business. His territory includes Canada. He told me that his Canadian clients are clamoring for order to be filled before the tariff starts in July. His America clients are also after him for steel. He's told the Canadian clients that they are backlogged in supply by about 3 months, so there is little chance to meet the inventory needs before the tariff starts in July.

He said, "I went into my boss and said, 'You might as well call the CEO in right now and have him make a statement about how we're going to handle this. Because we are going to take in the shorts if we can't meet the Canadian demand. We're gonna wind up paying the tariff ourselves to keep the client."

so is it a good idea to protect our steel industry? Is there a better way to do it than tariffs? Trump wants domestic steel just in case we cant get it from countries that dont like us much, like China. I dont see how that applies to Canada though.

[nullnor]

how does lowering the corporate tax rate affect any of this, if it does? i mean if all these businesses left america and have their headquarters in europe, can't we just be saying, 'look you left citing high wages and taxes, now it's going to cost you more unless you come back and make it and sell it here'.

also, isn't the whole thing about Harley Davidson that they are an American company. isn't that the selling point? so if they move to europe we can put tariffs on their product, americans wouldn't want to buy from them anymore anyways.

shouldn't the lower corporate tax rate offset the tariffs?

[nullnor]

i am pretty anti-business and capitalism, but what was it Winston Churchill who said democracy and capitalism sucks but it's better than what everyone else has. ..even though both have done so much for me, so i admit i'm just a bitch.

[senorsheep]

I feel like the separating families issue is a bit different but cant figure out exactly how to put it into words at the moment. Trade imbalance and protecting our industry was a campaign promise that I dont think he will back down from. Separating families was a mistake made as he was trying to fulfill the illegal immigration campaign promise. I believe Trump will regroup and take another pass at immigration later. I guess I'm trying to say I dont think he backs down easily from what he really believes in and I dont think he really wanted to separate families.

ugh, its too early to be trying to figure out what goes on in Trump's head. I'm probably not making much sense.

It's hard to nail down a guy who routinely lies, exaggerates, bullsh!ts, bluffs, and operates from no ideological economic foundation. I really have no idea what he'll do, either.

[TranaGreg]

...Thanks for trying to explain the Trump position. Do you know if tariffs between us and Canada and our EU allies was about even before Trump? If they had more tariffs than we had then I dont see how they could complain.

my sense is that there is more "complaining" coming from American companies. Most companies will not - can not - change their supply channels in a short period of time. As a result, if a manufacturer in Ohio is paying 25% more for steel, that will just get passed on to the consumer. of course, depending on the competition some companies may not be able to survive that.

George Mason University runs a good site on trade ... link here. From that site ...

June 25: W.H. Bagshaw Company, based in Nashua, New Hampshire, may be forced to temporarily shut down due to steel and aluminum tariffs. The tariffs, according to co-owner and vice president Adria Bagshaw, have left the company without the basic materials necessary to manufacture their product. Other New Hampshire manufacturers, like Tidland Corporation, have expressed concern that retaliatory tariffs could further harm their business
...
The vast majority of American manufacturing firms are small- or medium-sized businesses with razor-thin margins. These businesses must now reprice their entire product lines and grapple with how much of the cost increase they can pass onto consumers before they start losing too much business. That’s what LOOK Trailers of Indiana is doing, as it struggles to absorb the 25 and 35 percent cost increases in steel and aluminum, two of the company’s key inputs of its manufacturing process.
...