DaleB
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Ignorance is bliss, I suppose. Have a great day.
China 25% tariffs
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James331
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James331
Lol, yeah, China is great and all the naysayers are fools, so when are you moving over there?
paflyer
Final Approach
Tell that to the Chinese.
denverpilot
Tied Down
Which is a great dinner table and high school and college classroom discussion that helps maintain the illusion that they’re actually used that way, when they rarely are. Politicians don’t enact them for true fairness. Ever. That doesn’t meet their personal goals.
midwestpa24
Final Approach
Without delving into too much of a political conversation and getting this thread locked, politicians have the ability to corrupt any and every system and tool at their disposal. Is it a perfect system, no, but its all we have for now. Best we can do is vote the bastards out!
After the 1929 crash and depression they passed Smoot-Hawley bill, signed by republican Herbert Hoover, which was a bunch of tariffs to "save jobs". It backfired and made the depression worse. If you want to make people poorer, pass more tariffs. As for the USA being "taken" by other countries, consider that the USA is the wealthiest nation on earth by GDP and Net Worth. The USA also has the almighty DOLLAR, which benefits the USA greatly because it is demand by other countries.
Do a google on "Smoot-Hawley wiki"
These tariffs are mostly special interest, hot air, vote getting, ****ing contests. But if we get a lot of them, they can really matter.
Do a google on "Smoot-Hawley wiki"
These tariffs are mostly special interest, hot air, vote getting, ****ing contests. But if we get a lot of them, they can really matter.
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Gary
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If it were only that simple. Of course for your example to work, you need millions of people to consciously decide to pay more money for the exact same car to potentially save thousands of jobs. Given a choice, the vast majority of people won't do that.
What really decimated auto workers isn't trade deals but poor quality (particularly in the 1970's), and automation.
How have we "forced" companies to move? We are manufacturing more than ever, different things perhaps, manufactured in different ways (see pictures), but the fact remains we have prospered more as whole than we would with restrictive import laws. Capital ALWAYS follows return. Unless we also put restrictions on how we invest our money, other countries that can produce a better return on investment will win out.
Completely free trade is a misnomer, it doesn't truly exist anywhere, that is why there are trade agreements. Unless the government wants to pick and choose winners and losers (and I do agree they have in the past), the most competitive businesses will win out,whether in the US or abroad. Trade agreements are not utopia but reality.
If tariffs saved jobs, then why not BAN all foreign trade?
DaleB
Final Approach
It was, at its root, ****-poor and unbelievably short-sighted management. US auto manufacturers (among many others) completely failed to see the rising quantity and quality of foreign car manufacturers, especially Japan. Japanese cars had always been pretty much a joke, along with nearly everything else Japanese made. The writing was on the wall as the quality of Japanese manufactured goods improved by leaps and bounds, and they started to innovate rather than simply mimic. US management ignored it, believing that the Japanese could never compete with them... much as as some ill-informed and naive members here still believe the same thing about another Asian nation long renowned for producing cheap garbage. The only driver for US auto manufacturing was short term profit. Cost reduction above all, sell the stuff as quickly as you can unload it and to hell with quality or innovation.
We hear people saying ridiculous things today, like China not producing anything of value. Those people are apparently unaware that most of the electronics we use are produced in Chinese factories - even the high end expensive stuff. Or that China has the world's largest automotive production, producing more cars than the US, Japan AND Germany - combined. I'm not saying we should all love China, I'm saying that to write the country off as nothing more than a source of cheap shoddy junk is just as short-sighted and stupid as the top executives of GM, Ford and Chrysler were in the 70s.
But it's an education problem. As long as you have a large portion of our population failing to see what's coming, we're pretty much screwed. Tariffs won't soften the blow one bit.
Chip Sylverne
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Quit with the negative waves, man.
And here is the other side of your answer. You've imposed huge societal costs that will find heir way into other industries, you've limited any growth to the domestic market, which also puts those jobs in jeopardy since management will have even greater incentive to cut costs with automation or cheaper materials. And you'll probably be producing an inferior product do to lack of lower priced competition. It's been said that Honda and Toyota import quality and price competition were what saved the US auto industry.
I don't think anyone is saying mistakes haven't been made in trade policy. Protective tariffs will only compound them.
denverpilot
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Hmm. Without going too deeply into that, voting out “bastards” doesn’t work when there’s a 100 person deep line of bastards waiting to take the first bastard’s place. LOL. That one is a fairy tale we tell schoolkids, too.
We'll just print it. Fed prints it, gives it to the govt, who then gives the "bond" to the Fed who buys it. Ever hear of Quantitative easing?
I wouldn't say China is great. It is a nice place to visit, and all, but they work 6 days a week and work very hard. However, they are very well educated. In the pharmaceutical and chemical industry, many Chinese came here, got advanced degrees, work visas, and worked here. Some of them went home and started their own companies, and used their contacts here to get contracts. First it was intermediate compounds, the building blocks of drugs. These don't need to be pure since they are used in subsequent reactions to make the final product. Next it was drug discovery and library synthesis. All that work used to be done here. WuXi Biotech contracted with all the large pharma companies for this work. Now they are doing drug discovery on their own. For now, they buy the equipment manufactured by my employer and sometimes I go there to train them how to use it well.
We created out own competition.
Too true. We have 2 parties, and they made barriers to keep it that way.Hmm. Without going too deeply into that, voting out “bastards” doesn’t work when there’s a 100 person deep line of bastards waiting to take the first bastard’s place. LOL. That one is a fairy tale we tell schoolkids, too.
James331
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James331
I don't think it's competition, IMO China is a third world country with a great hype job
They are good chemists & computer scientists. I work with them often. We lost enough chemistry jobs to them that the American Chemical Society had to open "local" sections over there. Please see the links below, especially the last one.
Thousands of chemist jobs have been lost to China and, to a lesser extent, India. I don't know what industry you work within, so maybe they truly aren't competition to your employer. I was lucky enough bail from big pharma before all the cutbacks. Like I said, WuXi has their own drug discovery efforts, they pass all the FDA inspections for pharmaceutical manufacturing, and they are bigger than Merck. They'll be here. They are also working in crop science, so they will be going after Bayer Crop Science and Monsanto (although they will be the same company soon).
See: https://www.acs.org/content/acs/en/global/international/chapters/south-western-china.html
https://www.acs.org/content/acs/en/global/international/chapters/shanghai.html
And please see this page: https://www.acs.org/content/acs/en/membership-and-networks/acs/china-community.html
luvflyin
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No. Is it about creating inflation so the bonds are being paid off with a buck that's worth a lot less than the buck that was used to buy the bond?
paflyer
Final Approach
Every been to Hong Kong? Shanghai? Shenzhen?
Dav8or
Final Approach
Yes it is likely to happen one day and what it'll be like is when Germany dictated the austerity measures to Greece, or how we like to dictate to Puerto Rico now, only it will be on a much more massive scale and China will be doing the dictating and we will be doing the suffering.
Of course that is true. But it is more complicated, and all the wealthy that leverage their credit to buy fancy things also pay back with cheaper dollars.
The real problem will be when the Chinese currency replaces the dollar as the reserve currency of the world. Our dollar is backed by nothing.
As per the Bretton Woods agreement, in part, all oil is transacted in dollars, that certainly helps to prop up the dollar.
Dav8or
Final Approach
...and other bastards in.
I truly believe that nearly all politicians start off their careers with very good intensions, but power and money corrupts and the system they have to work with makes it very, very hard to effect change.
denverpilot
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That agreement only affects five countries. All sorts of oil trades are done (via computers) in all sorts of currencies all over the world.
I would have to say that it doesn’t prop up the dollar as much as one might think. Crude oil traders speculated as much as any other commodity trading done at CBOE or any other marketplace back when I was working in offices with crude trading going on in the rooms down the hall, and I doubt that’s gotten anything but more computerized and automated in both good and bad ways since back then.
They were doing it on IBM mainframes back then. They had just started to move it to other systems. When my family members left the biz and retired they’d spent about a decade moving crap like that into SAP. And then explaining that the company didn’t need to pay money to AUDIT things the computer did for them anymore.
Oil companies are slow to change behavior. But trading wasn’t slow in 1990-1993 when I was at one.
Bad trades were often fixed at the monthly inter-company golf matches. “Hey, I bought XXXXX barrels and shoved it into tanks at Cushing and our refinery can’t run it now. Want to buy it and I’ll buy that stuff you have in California in tanks that we can get to Long Beach that you can’t run, and fix both of our problems?”
Always deals going down on the golf course. I hate golf. I went for the beer cart and the food.
I was working on scheduling tankers and they were a lot less messy since our tankers went to our ports. Mostly only the weather screwed us up. Three tankers sitting off shore in bad weather who couldn’t offload would screw us up for a month to straighten that crap out.
Mmmm. Tanker scheduling. AmiPro and Lotus 1-2-3 making 3D spreadsheets that automated who’d be in port, when, and what they’d be offloading... yup... we were an IBM shop! (See: Mainframe...) hahaha. Tasty printouts on the fancy green bar dot matrix that was double wide! LOL. Ugh.
jspilot
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I like a lot of your post but, as someone like myself currently teaching g high school economics, I'd like to add that trade does benefit the wealthier country as well. A great deal of the American economy is based on consumer goods. If those same goods were made in America, the price per good would go up and the American people would have to spend more of their money to get goods we want. Essentially the wealthiest country benefits from cheaper cost of goods thus also expanding it's wealth. Tariffs level the playing field but, we must remain aware that, consumer spending is on a micro level( meaning each person decides what he or she can afford-- not the government) and tariffs are on a Macro level( meaning, governments care about trade balance, the average citizen just wants well made goods at the cheapest price.) If we weave President Trump into the discussion, he keeps talking that the tariffs will help raise the GDP, which in theory, could happen.
The issue I can forsee becoming a potential problem is if the cost of goods begins to rise steadily, American's, as a whole, will struggle to maintain their current living standards and will either go further into debt( which is already at all time highs right now) or begin to stop buying goods-- this second scenario leading to even more peril for the overall health of the United States economy. American's have not seen real wage growth in our country since the 1970's and, most of our nations wealth is centered on the concept of "cheap goods and cheap money." Well if cheap goods go away and we are left with only expensive goods, the United States is in for a tougher time and American's won't be as willing to spend. Look to Apple's iPhone X as reference to how even fairly desirable products with useful technology, don't do as well if the price is high. When spending decreases, it may not be long before our consumer based economy really struggles.
I have no issue with Tariffs as a concept and they have a role in balanced trade. The US just has to be careful about not creating an inflationary wave. Let's be truthful though, it is in neither countries best interest to see the other struggle. Give the other country and little pain in the purse, ok. Neither China nor the United States wants the their country to enter a recession over this!
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jsstevens
Hmm. Without going too deeply into that, voting out “bastards” doesn’t work when there’s a 100 person deep line of bastards waiting to take the first bastard’s place. LOL. That one is a fairy tale we tell schoolkids, too.
Boss Tweed (Tammany Hall political boss, https://en.wikipedia.org/wiki/William_M._Tweed) said "I don't care who votes as long as I do the nominating."
James331
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James331
I went to a bodies exhibit, that's about enough china for me.
BigBadLou
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Lou
Right, or China can sell through another country. Duh. This was a very "smart" tariff.
And I don't see manual jobs coming back. They ran away for a good reason. Nobody wants to pay inflated prices due to union greed. Hourly wages for unskilled uneducated high-school-dropout labor in triple digits? Not sustainable. Unions were a good idea at first but then they turned into greedy bastards and killed the industry in this country.
I think Amazon will quickly shift to buy stuff from India, Vietnam and Taiwan now.
Fearless Tower
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Shanghai IS a third world country with a (shoddy) first world veneer.
And yes, I’ve been there.
overdrive148
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PaulS
Touchdown! Greaser!
Lol, China is screwed without the US economy and it knows it, this "trade war" will hurt China the most if they allow it to happen. It's long overdue in my opinion.
Clip4
Touchdown! Greaser!
I find it amazing we trade with the commies in China and Vietnam, but won’t trade with the commies in Cuba.
Clip4
Touchdown! Greaser!
In the 1929 market crash, 729 banks failed and the govt did nothing. In the 2008 market crash, 538 banks failed. Had the govt done nothing there would have been more than in the Great Depreesion
Credit Bush, Obama, and othe world leaders who did the equivalent of flying over their countries and throwing money out of helicopters that prevented a second Great Depression.
Tariffs had nothing to do with the Great Depression. It is a fable that keeps being repeated without any basis in fact.
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Chip Sylverne
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Quit with the negative waves, man.
The argument isn't that Smoot caused the great depression. The argument is that, in it's attempt to protect the domestic market and create jobs, Smoot was abject failure and helped to prolong the economic pain, and in that, there is truth. Export markets retaliated, and farmers were unable to export commodities like tobacco, cotton and other important crops. Foreign debtors were unable to pay financial obligations, putting even more pressure on banks. The cost of living increased due to the increased price of goods.
As a farmer I keep an eye on some of the ag message boards. It's telling, and some of the growers were pointing to the "success" of the sugar tariffs that have been placed on imported sugar for a number of years. What they seem to forget is that where there were once hundreds of large confection manufactures in the US, employing tens of thousands, there are now only a handful, and many of those are struggling to resist offshore manufacturing. Almost 90% of the sweets sold this Valentines day were Hecho en Mexico, and not due to labor cost.
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Aztec Flyer
People see pictures of shiny office towers and freeways in Shanghai, or Dubai, and they think this is representative of the country or region as a whole. Shanghai is not China, and Dubai is not the Arab Middle East. When I lived in the Persian Gulf I used to think they were 2-1/2 world countries.
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Aztec Flyer
Its the same thing with the steel tariffs. There's a comparatively small number of steel manufacturing workers that will benefit, and a larger number of US companies with a much larger number of employees that use steel and are going to see their input cost rise. So how do they offset this? Three choices: Raise prices, offshore all or part of the production, lower costs with automation (or some combination of these).
What many people don't realize is the USA is already one of the most self-sufficient economies in the world. It is the major world economy that is least dependent on imports or exports; far less so than China, Japan, or Germany, the other large economies people point to as "successful", all of which continue to pursue forms of mercantilism.
This Administration is leaning towards a form of American isolationism: Made in America, bring the troops home, withdraw from multinational organizations like the UN, and multinational trade agreements like NAFTA. Tariffs are just a small part of it. Some call it a Fortress America strategy. Nothing wrong with controlling ones own destiny...as long as nobody swallows the political ******** that its all benefit and no cost.
It's the vote getting "never trust a foreigner" strategy.
Chip Sylverne
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Quit with the negative waves, man.
And while we threaten a trade war, the Chinese invest in infrastructure for a new "one belt silk road" to distribute their goods all across the Asian and African continents.
Dav8or
Final Approach
Agreed. Politics are strange animal with little rationale. Perhaps if we were to also trade with the Commies in North Korea, there might not be so much tension there.
denverpilot
Tied Down
That’s the official story they want you to believe, anyway.
Some of the sleaziest banks in the land who were politically connected, survived. Some very good banks who weren’t, were liquidated.
Cough, Wells Fargo, cough, giving bonuses for stealing from their own customers... and people continue to do business with them... oblivious and in the belief that they changed their culture.
Wells should have gone under with AIG in the first housing bubble. Scum then, and still scum twenty years later.
And they’re just one example. We could spend a week on BoA.
Full disclosure: I have a safety deposit box with Wells. I figure they can’t screw that up. It’s because the slime bags bought the building it was in which used to be another bank. A much better bank.