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AFL-CIO President Backs Trump's Tariffs, Calls for More Bailouts for Businesses Hurt by Them

It could cost $39 billion to cover the damage caused by Trump's trade war.

MIKE SEGAR/REUTERS/NewscomMIKE SEGAR/REUTERS/NewscomWhile weathering criticism from Republican lawmakers and traditionally Republican special interests over his anti-trade policies, President Donald Trump has one somewhat unlikely ally: the head of America's largest union.

Richard Trumka, president of the AFL-CIO, told Inside Trade his union and its members are "generally supportive" of the president's approach so far, including the prospect of additional tariffs on Chinese imports. "Sometimes what's good for the country may be bad for Joe or Jane in the short term," he said, "but in the long term if it's good for the country it's good for everyone."

Even if that were true, it might be a tough sell to Joe or Jane. But the consequences of the tariffs are more significant than Trumka suggests, sounding a lot like Trump administration officials who have likened reports of tariff-inflicted economic pain to "hiccups." Trumka seems to realize that. Otherwise he would not have told Inside Trade that the federal government should commit to subsidizing industries that stand to lose as a result of Trump's trade policy.

The White House has already outlined plans to spend $12 billion through a New Deal-era crop insurance program to subsidize the losses of farmers who may see lower prices for products such as soy beans because of the retaliatory tariffs China has imposed on American farm products. Covering all the losses—not just those affecting farms, but those affecting all industries, as Trumka suggests—could require as much as $39 billion, according to an analysis that the U.S. Chamber of Commerce published this week.

"Offering a bailout to any single industry is a slippery—and costly—slope," the report warns. "The best way to protect American industries from the damaging consequences of a trade war is to avoid entering into a trade war in the first place."

Trumka's some-pain-now-for-gain-later argument would carry more weight if Trump had clear, achievable goals. So far all Trump has to show for his trade war is a handshake deal with Europe promising not to escalate things farther. There are no planned negotiations with China, and Chinese officials recently told Politico they don't even know what Trump's goals are. The two sides are now getting farther apart, not closer, on trade. Canada is refusing to participate in this week's conference on the North American Free Trade Agreement, and talks with Mexico don't seem to be going well.

But at least Trump can claim he's following through on his promise to shake up Washington. How many other Republican presidents would have Richard Trumka applauding?

Photo Credit: MIKE SEGAR/REUTERS/Newscom

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  • John||

    Meanwhile...

    57,000 jobs were added last month.

    The unemployment rate fell to 3.9 percent, from 4 percent.

    Average hourly earnings rose by 7 cents to $27.05. The year-over-year gain is unchanged at 2.7 percent.

    http://www.nytimes.com/2018/08.....-2018.html

    At what point do the facts on the ground contradict the narrative enough to force you to reconsider it?

  • sarcasmic||

  • John||

    The facts are what they are. At some point, you can't just dismiss them. I am not saying that the facts mean that we should go full on isolationist. But every day the economy continues to do this well, is further evidence that the sweeping claims about trade and the predictions of doom made by free trade advocates are not true. Maybe both sides of the issue have valid points and the truth is somewhere in the middle and like all truth not as clear as the ideologues of any sort claim it is.

  • sarcasmic||

    Broken windows create jobs too.

  • Last of the Shitlords||

    Non-sequiter. Try again Sarc.

  • sarcasmic||

    Tariffs can create jobs. That's true. But it negates comparative advantage. These are jobs producing things that others can produce more cheaply. It employs people who could be employed in something where we have a comparative advantage. So it actually makes society poorer because resources are being used less efficiently.

    Seen and unseen.

  • JesseAz||

    We dont' live in a perfect free market. Other countries already have tariffs. You can be a libertarian without having to ignore reality.

  • sarcasmic||

    What does that have to do with what I said?

  • loveconstitution1789||

    You can be Libertarian and want free trade or as close to free trade as you can get.

    You can also be Libertarian and want to work a business deal with foreign nations to move toward free trade. You can use leverage and still be Libertarian.

    You can play hardball in business and still be Libertarian.

    You can play hardball in foreign affairs relating to trade and still be Libertarian.

  • Nardz||

    "Free" trade
    But the argument behind the tariffs is to get freer trade.
    So one may argue strategy, but the goal of both tariffs and no tariffs here is Free trade.
    I see some arguments, pro and con re tariffs, made here that want free trade.
    But the bulk of criticism I see tends to be little more than a demand for the status quo ante Trump.
    Would not expect libertarians to be so protective of that status quo.

  • sarcasmic||

    But the bulk of criticism I see tends to be little more than a demand for the status quo ante Trump.

    That is a straw man. Opposition to new tariffs doesn't equate to support of the old tariffs.

  • JesseAz||

    Except nobody makes a concerted effort to ever analyze the base state of pre-trump tariff policies to see if they were equal in nature. SO it isn't a strawman.

  • sarcasmic||

    Why must they be equal?

  • sarcasmic||

    Just as some of us who opposed the redefining of marriage by the government didn't necessarily support traditional marriage. We wanted government out of the marriage business entirely.

    Opposition to Trump's tariffs can mean opposition to all tariffs, not support of pre-Trump tariffs.

  • loveconstitution1789||

    Sarcasmic, its clear you want free trade. I want free trade.

    We just disagree on how to get free trade.

    I am willing to let Trump wheel and deal for 12 months to pressure China and the EU. I definitely dont want permanent trade restrictions that were higher than pre-Trump.

    Some of us think its worth the risk and short term pain.

    Freedom isnt free and neither is free trade.

  • sarcasmic||

    Some of us think its worth the risk and short term pain.

    Doesn't seem very libertarian to me to impose your will upon others, even if you have good intentions.

  • Baron Von Weinermobile||

    Actually, free trade is free. We simply unilaterally remove all of our own trade barriers. Simple as that. Why you are so dead set on saving China's economy, I have no idea. Saying you want free trade is obviously false on its face. You don't understand what it is. If you did, you wouldn't be thinking that it is something that requires both sides to institute. Furthermore, who are you to make me pay higher prices and higher taxes, simply because you want to save China's economy? If you want free trade we don't need 12 months of destroying U.S. businesses and consumer buying power. We can do it today and it will cost us nothing. But you don't understand this because you, like Trump, ascribe to a marxist labor-theory of value.

  • sarcasmic||

    Actually, free trade is free. We simply unilaterally remove all of our own trade barriers.

    Yep. The problem with that is that producers who howl loudest, and they can lobby the government. Consumers who get screwed by tariffs have no voice.

    The benefits of protectionism are concentrated (seen), while the costs are dispersed (unseen). The costs far outweigh the benefits, but because they are unseen they are ignored.

    People like lc1789 think that free trade must be bilateral. They are wrong. Unilateral free trade still benefits society much more than protectionism. But like I said, it's matter of the seen vs the unseen.

    Unilateral free trade isn't perfect, but it's better than a trade war.

  • loveconstitution1789||

    Sarcasmic, unilateral trade is pushing your will onto American businessmen who want to trade with the country that you are buying from.

    Luckily, the USA is a Constitutional Democratic Republic and as such, the Constitution gives the power to Congress and the President to do trade deals or create the environment for free trade.

    Like it or not, trade with China is through their government. Unless you are doing black market and you might your Chinese business partner missing one day.

  • loveconstitution1789||

    Thats not free trade, its unilateral trade.

  • BYODB||


    Actually, free trade is free. We simply unilaterally remove all of our own trade barriers. Simple as that.

    That's adorable. Yes, because Lockheed Martin should be able to sell F-35's to China. That'll work out well.

    And now, having been shown that there are reasonable exceptions to free trade, I'm sure you'll make a point that addresses something other than a blatantly utopian pipe dream.

    I'd be a lot happier with trade with China if they weren't pirating our technology and would operate in some kind of good faith. For some reason, free trade absolutists love to pretend the rest of the planet doesn't exist, which is why so many of them are libertarians. Because libertarians also like to pretend the rest of the world doesn't exist.

  • Nardz||

    It's only a straw man if you'd argue the pros and cons of strategy toward freer trade.
    Most of what I see is just bitching about tariffs, with little to no consideration for how otherwise to get to freer trade.
    It's not all "but Trump!", which is why I say most, but it has appeared as demands for status quo ante.

  • vek||

    Yup!

    What all you people miss is that we will NEVER get actual free trade without twisting arms. So as usual dogmatic libertarians have a goal that is good... And no clue how to get there in the real world.

    China presently has a system which manipulates things in their favor... Why would they give that up??? Where we fucked up was not demanding they drop all trade barriers day one to gain access to the American market. That was past politicians being idiots. Essentially doing what you guys are advocating, dropping our barriers and not expecting the same in return.

    All this has done is obliterated our manufacturing base, and contrary to popular belief manufacturing is still a massively important industry world wide. Us and the UK have the smallest number of workers in manufacturing of ANY industrialized nation.

    If we had demanded China open up, THEY WOULD HAVE. Now we're so intertangled it's going to be a mess to fix it, but it can be done, and will be well worth it if we do. Laying down and taking it in the ass IS NOT the way to get real free trade, which we all agree is the best end goal.

  • sarcasmic||

    vek, you talk as if trade barriers only hurt the exporters. They hurt Americans as well. Even unilateral free trade is good because it allows us to use comparative advantage in our favor. We import stuff that can be produced more cheaply abroad, and that frees resources to be used to for the things we can produce more cheaply. Trade barriers necessitate self sufficiency. Show me a country that is self sufficient, and I'll show you grinding poverty.

  • chemjeff radical individualist||

    All this has done is obliterated our manufacturing base

    Manufacturing output, as a percentage of real GDP, has stayed about constant for decades now.

    Manufacturing EMPLOYMENT has declined.

    http://www.stlouisfed.org/on-t.....-declining

    And that is GOOD! A line worker doesn't need an expensive American public education for repetitive rote manufacturing jobs. Why should taxpayers - or anyone, really - pay for an expensive Western-style liberal education for a person who is only destined to put cogs on widgets repetitively for the rest of his life? It is stupid.

    The decline in manufacturing employment means that the human capital in this country is being put to more productive use. More people are taking that expensive education and doing something with it that actually uses that education in some substantive way.

    So the manufacturing base that we have now, is more automated and employs fewer people in these dead-end type jobs, freeing up the human capital to explore their potential in better ways.

    We should all be celebrating this, not condemning it or romanticizing some nostalgic golden age of manufacturing that never really existed.

  • sarcasmic||

    Manufacturing EMPLOYMENT has declined.

    And that is GOOD!

    We used to be a nation of farmers. Then we became a nation of factory workers. Now we're a service oriented economy.

    But that doesn't mean we don't produce food. We produce more food than ever! We do it with fewer workers.

    That doesn't mean we don't have factories. We manufacture more goods than ever! We do it with fewer workers.

    If protectionists had their way we'd still all be farmers. After all, we can't lose those jobs.

  • Juice||

    redefining of marriage by the government

    Oh, for the love of Christ.

  • Robert||

    I opposed redefining marriage too, but didn't want gov't out of "the marriage business" unless it completely got out of the "law & courts" business. I oppose gov't regul'n of marriage, but not having courts take cases on the matter of whether X is married. Marriage should not be licensed, but it should be ruled on according to its meaning in common law.

  • vek||

    See my other post in this thread. The problem is we threw it under the bus, without having something better to replace it. You are believing in the way it is supposed to work in theory... But it hasn't. We replaced $20 an hour manufacturing jobs with $10 an hour barista jobs. Free trade theory is a THEORY, and it has not worked out IRL as it was supposed to.

    A large part of this is obvious in the way you're talking about it. You're imagining some factory worker from 15 years ago is going on to become an MD or engineer... You forget that the Bell Curve exists, and the majority of these lower IQ people are incapable of moving up into truly high value jobs. So if you remove the mid tier job, and they can't move up to being a high value worker, the only direction you can go is down. And this is what has happened in objective reality.

    I understand free trade theory as well as anybody, but when observed reality differs from predicted outcomes made by a theory, you need to adjust the theory. Free trade theory simply doesn't include enough real world variables to be completely accurate... ESPECIALLY when it's not bilateral free trade, which I think WOULD come quite close to the theorized results.

  • chemjeff radical individualist||

    But the argument behind the tariffs is to get freer trade.

    That is the rationalization put forward by some of Trump's sycophants to justify what Trump is doing.

    Some form of mercantilist protectionism is actually the one thing Trump has been consistent on for a number of years now.

    Take his 'deal' with EU. That was about forcing open European markets to American soybeans and LNG. That is mercantilism, not free trade.

    So no I don't believe the end goal here is "freer trade". I think the end goal here is mercantilism, with the rest of the world being cajoled into accepting a dominant American world order.

  • JesseAz||

    Trump already outlayed his policy of no trade barriers on either side for the EU. The EU rejected it. When one side of the trade market basically notes it will always have a base barrier to entry or trade, then the other players in the markets should equalize to those barriers. You may not like it, but giving one player an extra advantage to everyone else is not free trade. It's more of a prisoners dilemma situation than an argument for pure and free markets.

    You don't have to be ignorant to reality to be a libertarian. You can prefer liberty but recognize the reality of current situations.

  • chemjeff radical individualist||

    Trump already outlayed his policy of no trade barriers on either side for the EU.

    He did? Oh wait, he had one off-hand remark reported second-hand at a G7 summit, Is that what constitutes official policy now? I thought we weren't supposed to listen to his off-hand, spur-of-the-moment remarks. Otherwise I suppose it's his "official policy" to incinerate North Korea in nuclear war, and to fire all of the kneeling NFL players.

    Show me where he has actually laid out any sane comprehensive policy that isn't some random off-hand remark. Because I don't think the end goal here is free trade. I think it is American-dominated mercantilism, akin to the 19th century and the British Empire.

  • Nardz||

    "He did? Oh wait, he had one off-hand remark reported second-hand at a G7 summit, Is that what constitutes official policy now? I thought we weren't supposed to listen to his off-hand, spur-of-the-moment remarks. Otherwise I suppose it's his "official policy" to incinerate North Korea in nuclear war, and to fire all of the kneeling NFL players."

    Fact: Trump offered free trade, EU declined. Whatever conditionals you want to place on it, that happened. If they thought he was bluffing, if they were open to free trade, they could have agreed. They did not.

    And
    if NK starts a war, fires off nukes - yes, US policy will be to incinerate them. Letting that be known decreases the chances that NK provokes it.
    The US government doesn't employ any active NFL players (shout to Peanut Tillman, FBI agent). Trump cannot fire them, thus it cannot be policy. Trump stated his opinion as a hypothetical.
    Dishonest and hysterical reactions don't lend credibility, but are quintessentially progressive.

  • chemjeff radical individualist||

    When one side of the trade market basically notes it will always have a base barrier to entry or trade, then the other players in the markets should equalize to those barriers.

    "When one nation punishes its own citizens, then the US should punish its citizens in equal measure! It's only fair!"

  • Nardz||

    I think your end goal is feudalism, but, like all Progressives and internationalists, at least you have "good" intentions

  • chemjeff radical individualist||

    So, libertarian free trade equals feudalism? This sounds more like an argument that a progressive might make.

  • Nardz||

    Libertarian free trade doesn't exist.
    The status quo ante is akin to colonialism in the wrong direction.
    You advocate destruction of blue collar jobs and unlimited importation of people and manufactured goods so that government and the largest multinationals can continue increasing their share of the US economy.
    That which you advocate for leads to greater resource imbalance so that larger proportions of Americans become dependant on "lords".
    Aka internationalist feudalism

  • Last of the Shitlords||

    Jeff, you're not a libertarian.

  • Scarecrow Repair & Chippering||

    Let's all dig holes with spoons, shall we? Them's facts. Them's jobs. Satisfied, dipshit?

  • JesseAz||

    The people making sweeping claims about Trump starting a trade war with tariffs belies a complete ignorance on those people. We've had tariffs being passed for decades. Trump didn't start the war, the war has been ongoing since countries existed. You can claim he elevated it, but without a comparison to the tariffs other countries impose on american goods, the comment is useless. If you notice, most of those with the histrionics on trade barriers and tariffs never mention the already existing policies that currently exist in the other countries. It's just the height of ignorance to claim trade wars aren't wars if only one side is participating.

  • chemjeff radical individualist||

    The reality, is that over the past 60+ years, the entire world has been slowly and fitfully moving in the direction of lower tariffs and lower trade barriers. That is what GATT, WTO, NAFTA, TPP, etc., are all about, in admittedly very imperfect ways. They represent movement in that direction. Trump comes in and then declares that this status quo is unacceptable because it forces America to compete on a *more equal* footing with the rest of the world. That is the trade war that is the fault of Trump. Of course we did not exist in a state of pure free trade pre-Trump. Of course agreements like NAFTA are not pure free trade. Of course nations still have tariffs and barriers that they use on each other. But the consensus *had been* to slowly move *away* from that sort of thinking. Trump rejects that consensus. That is the problem.

  • jay||

    well yes and I mostly agree with you, except if you want to maintain the moral upper hand, then when someone offers you what you claim to have wanted, its your job to take it, regardless of the sincerity of the person, since it is what you claimed to have wanted. The fact that the rest of the world said nothing about the no tariffs offer from trump makes the trade war more than just trumps responsibility, and indicates that much of the world is in fact, not on board with the movement towards pure free trade. More likely, there was a given point in time where the direction changed in favour of more free trade and has moved back again towards less, sometimes before trump, hence the crickets. As usual trump is more a symptom than the cause.

  • loveconstitution1789||

    But not lower trade restrictions. Tariffs are but one part of trade restrictions.

  • Sometimes a Great Notion||

    Well my company put a freeze on hiring and new equipment orders. We are in wait and see mode. Material costs have soared for construction. If this continues we will have layoffs.

  • loveconstitution1789||

    And companies had layoffs when the managed trade plan had costs for materials too high too.

    This is why managed trade sucks. Trump offered free trade and our trading partners refused.

    We're at war buddy. Haven't you heard? This is Trump's trade war!

  • loveconstitution1789||

    More votes for Trump in 2020!

  • Bubba Jones||

    Won't subsidies trigger a new round of tariffs from our "partners"?

  • Just Say'n||

    We should be subsidizing Jessica Alba movies where she's in a bathing suit during the entire film. Not enough of those have been produced in quite some time. Subsidize that ass!

  • Nardz||

    That movie was so, so bad...
    But worth it for her

  • Nardz||

    *worth watching it

  • Last of the Shitlords||

    Or films where Jessica Alba is showering or taking a bath for the entire movie.

  • JesseAz||

    Not necessarily. The US has often backed down when China or the EU put tariffs on American goods. So far we have only seen the threat of reciprocity from most of the players. EU for example has agreed to discuss new terms.

  • Just Say'n||

    Well now we know that an article titled "The Hidden Racist History of (Private Sector) Labor Unions" is in the works at Vox

  • Just Say'n||

    "Why Samuel Gompers Was the Equivalent to the Grand Wizard of the KKK"

    - Slate

  • Just Say'n||

    "The Problematic History of the Knights of Labor"

    - Salon

  • Just Say'n||

    "Alt-Right Teamsters Are At Odds With Righteous AFSCME"

    - NYT

  • Just Say'n||

    It just writes itself

  • John||

    The Unions are just responding to racist trolls. This is satire Just Say'n.

  • John||

    "The Long History of Racism in the Union Movement"

    -NYT

  • loveconstitution1789||

    Trumka's some-pain-now-for-gain-later argument would carry more weight if Trump had clear, achievable goals.

    He offered free trade with trading partners that ended trade restrictions. They refused. Next he said that tariffs would be implemented by a date. Tariffs were implemented. Within 5 weeks, the EU cracked and discussed lowering trade restrictions.

    Maybe if the media was not burdened by so much TDS, they could ask for Trump's plan. As everyone knows, Trump revealing his plan would be stupid since the media would undermine it even if it was good and the EU and CHina would know the plan and simply hold out.

  • loveconstitution1789||

    Seems like a plan is in motion.

  • Nardz||

    "the media would undermine it even if it was good and the EU and CHina would know the plan and simply hold out."

    And that is exactly what Reason, the Kochs with their commercials, and press at large are doing.
    Seems counter productive to undercut tariffs once in place and it's become obvious this is the game plan no matter the bitching.
    But perhaps the Kochs and other multinationals, internationalists, reap uneven benefits from the status quo.
    So they will keep signaling to the EU, but more importantly China, to just hold out as long as possible.
    China's relying on US domestic pressure to win out as their ally, even as their economy continues to falter and more dissidents need to be shut down.
    One might ask if tariffs would've already gotten freer trade if not for the enthusiastic undercutting of US strategy from within.
    North Vietnam also knew America's Achilles heel, and planned accordingly. Tet was a tactical disaster for the communists, but turned the strategic tide.

  • Baron Von Weinermobile||

    Free trade is not something you offer other countries. That is like saying "I will give Americans the right to free speech only if China agrees to give free speech to its citizens." And you are defending him by implying this is all a gambit to get speech barriers lowered across the board and somehow we should support it. It is idiotic.

  • vek||

    It is nothing like free speech dude. Slanted trade agreements, like all government manipulations of the market, can have MASSIVE ripple effects throughout the economy. We have about half the number of people working in manufacturing as Germany, Japan, and even fewer than backwards ass Italy for fucks sake! ITALY has a stronger manufacturing sector than the USA. It's a joke.

    It is no surprise that wages are stagnant IN THE EXACT DEMOGRAPHICS that work in the industries that have been obliterated. This shit has had real repercussions for real people, and they've not been good. We have adults working at McDonalds because we subbed out a ton of mid tier work to third world countries, but had no industries of comparable value, or superior value, to replace them. There just isn't enough IT work to go around buddy, despite all the nonsense people spew. And even if there were many of the displaced factory workers literally don't have the IQ to do it. If you can't move up, the only direction you can go is down... And that's exactly what has happened to millions and millions of people.

    Free trade theory is a THEORY. In reality it has not come even close to panning out as it is "supposed to," mostly due to the slanted nature of a lot of the trade IMO. It is simply missing too many real world variables. When a theory doesn't jive with objective reality perhaps it is time to revisit the theory and adjust it a bit?

  • chemjeff radical individualist||

    So tariffs are a form of welfare for low-IQ factory workers who can't get jobs doing something else.

    Is this really what you are arguing for?

  • JesseAz||

    If you were able to comprehend basic logic at a 3rd grade level you wouldn't have hit the reply button Jeff. No that's not what he is arguing for.

  • chemjeff radical individualist||

    Sure seems like it. We need tariffs in order to save manufacturing jobs for low-IQ people who would otherwise be displaced in the absence of tariffs. Right?

  • loveconstitution1789||

    China and the EU need tariffs. They also need the best market in the World- the USA.

  • vek||

    I'm simply observing that INTELLIGENCE is a real world factor, and one of many reasons free trade theory falls down from predicting real world outcomes accurately.

    As far as things go, anybody who doesn't pay at least SOME attention to the mob is a fool. If 75% of the low IQ people have no chances at any form of employment in 30 years, you think that isn't going to be a major problem??? They'll be burning cities for fucks sake. So like it or not you MUST pay attention to these things, and try to have policies that are decent-ish and take these things into account.

    As far as macro economic stuff goes, if you are looking for a stronger economy overall, swapping $20 an hour jobs for $10 an hour jobs is NOT producing a stronger economy. If you want to argue for free trade on straight up freedom grounds, that is a legit argument. But I think if you want to argue for it on pragmatic grounds, AKA it makes a stronger/wealthier economy, then such things matter. Not all trade is created equal, and IMO sometimes you can have a net negative in the real world.

  • Robert||

    jibe

  • JesseAz||

    Baron,... are you really this naive?

  • Baron Von Weinermobile||

    Trade deficits are actually a good thing and countries should be trying to achieve them. It is a sign of health and strength. Having a trade surplus means you are someone else's bitch.

    So, for those of you defending tariffs...why do you want America to be everyone else's bitch?

  • vek||

    Except you completely ignore the concept of "assets" and "net worth" genius.

    A nation that does more work than it needs to for basic survival is accumulating a higher net worth. This net worth gives them a surplus they can in turn invest to create still further future wealth.

    You have to balance life, you can't be too much of a miser... But you also shouldn't be too much of a spendthrift. We've been overspending as a nations for decades, we need to tilt things back the other direction a bit.

    What you are advocating is living not only hand to mouth, like poor, uneducated, morons do on the individual level... But rather you are advocating spending MORE than you make, because it makes you feel "wealthy."

    That is VERY short sighted thinking, and something very common with purist libertarians on trade. You can't just ignore WHO owns all the assets and whether or not they stay in the domestic economy or shoot abroad.

  • sarcasmic||

    In your own household, which would be better? To import more than you export, or to export more than you import? If you export more than you import, pretty soon you won't have much stuff. Sure you'll have more money, but money is not wealth. If you import more than you export, then you get more stuff. You become more wealthy.

    Money is not wealth. It is a means of exchange, and of acquiring wealth. But until it is exchanged for something, it's pretty much worthless.

    If you think money is wealth, and that exports are better than imports, then I've got a plan for you:

    Sell everything you own except the clothes on your back and a suitcase. Put all your money into the suitcase. Now go sleep on a park bench. Fuck stuff. It's just stuff. You've got money! You're rich!

  • Nardz||

    You completely ignore production here.
    What if he is an artist producing paintings?
    Should he import more and more paintings and cease production instead of selling his own?
    What if he does so, then ten years down the road wants/needs to paint more but has lost the skill to do so?

    What happens down the road when you become completely dependant on imports because you've lost the ability to produce?

  • vek||

    Well you clearly have a very middle class/lower class mentality.

    As I said, BALANCE is key. Duh. But, your way of doing things will lead to somebody having a bunch of depreciating "assets," whereas my way will leave somebody with a steadily increasing net worth, eventually allowing them to retire early, buy a yacht, and sit on the beach all day... Meanwhile you are living hand to mouth at 80 depending on your social security.

    If you're producing more value, not selling assets you already have, but producing more NEW value... That is what everybody strives for. Because the other way you are BK before too long. You don't need to be a miser, but producing a bit more than you consume makes you wealthy over time, in fact allowing you to own EVEN MORE things than the person who never invests. Consuming even a bit more than you produce leaves you in perpetually poverty, and eventually bankrupt.

    You can't really be so fucking retarded you don't understand this do you? I'm a business owner and am always amazed by how dumb some middle class employee types can be on this front...

  • vek||

    Building up long term assets and net worth is a very good thing for a person OR a nation. The USA used to own trillions in foreign assets more than foreigners owned of US based assets. That meant we had hundreds of billions a year flowing into US citizens hands from our foreign investments. Now that is reversed and foreigners own trillions more in US based assets, and they pull several hundreds billion dollars a year out of the US economy in the form of profits from their US based assets.

    If Americans still owned those assets that money would be staying here, and being spent here, and make the US a richer country. Do you get it genius?

    As I said above you don't want to be too much of a miser, but living beyond your means for long periods of time is NOT sound financial advice. The only argument for this on a national level is if we plan to intentionally inflate away our foreign debts, etc and screw everybody on purpose... But I would argue the long term repercussions of such an act would be so damaging to the USA, its people, and our economy that it's still a better more to just live within our means and not try to defraud the world just because we have the reserve currency!

  • turco||

    Vek : "money would be staying here, "

    Yup. Vek is a mercantilist.

    The point of the economy is consumption, not money accumulation.

  • vek||

    Are you really this dumb?

    It's about BALANCE. You can't consume EVERYTHING you make, AND MORE forever. An individual needs to save and invest for retirement. If you spend everything on booze, cars, blow, and hookers you will always be broke. Even just investing 10% of what you produce leaves you sitting pretty when you want to retire.

    As a nation we are reducing our future net worth via over consumption. You want to balance present consumption and future wealth, otherwise you end up penniless and beholden to those that hold your debt.

  • vek||

    "The best way to protect American industries from the damaging consequences of a trade war is to avoid entering into a trade war in the first place."

    The problem is we've been in a trade war since the day this country was founded! EVERYBODY is always in a trade war. The thing is our genius politicians decided to unilaterally disarm ourselves over the last couple decades, while allowing our competitors to maintain their armaments. It is equivalent to us giving up all our nukes after the Cuban missile crisis in the hopes that it would encourage the USSR to do the same... In other words it was a horrible idea.

    Also, anybody who doesn't understand the concept of short term pain for long term gain is an idiot. It is a basic tenent of the human species. We don't eat ALL our corn after it is grown, so we can save some to plant next season, even if it was a lean year and that means going hungry. It is NOT buying a new car now, so you can invest that money and have more when you retire. etc.

    I don't know that he is going about it awesome, it's surely not how I would do it... But at least he's trying. And if he decides to really push the issue we can't lose because we have the upper hand. Period. The only thing I want is an even more hard core and ALSO coherent policy targeting China and others... Because we can win, and it will be well worth whatever short term issues come up.

  • chemjeff radical individualist||

    The thing is our genius politicians decided to unilaterally disarm ourselves over the last couple decades, while allowing our competitors to maintain their armaments.

    This is completely not true. It's a cute Trumpian talking point but not true. Just ask the Mexicans what they think of the American agriculture sector displacing their own domestic industry as a result of NAFTA.

  • vek||

    NAFTA hasn't been even close to the worst of it. But it is pretty easy to look at tons of developing countries that have HUGE barriers to entry, where we have none. The WTO in fact intentionally allows developing nations to have more protectionism than 1st world nations. This is a fact.

    That said, as the biggest consumer market we had the chance to force open some of these markets. Those that would have cut deals with us would have got tons of business exporting, and those that didn't wouldn't have got all that industry. We are too big a prize to pass up, which is why they would have opened up a lot more than they did... IF we had forced the issue. But we didn't.

  • Robert||

    tenet

  • sarcasmic||

    Trade war: when governments compete over which one can best screw over their own people.

  • I'm Not Sure||

    And have the people ask for more.

  • Nardz||

    So US government hasn't been screwing its people over?
    That's your assessment of status quo ante?

  • loveconstitution1789||

    Sarcasmic is fine with the ISA losing and never adjusting its trade positions.

  • No Longer Amused||

    It can't be a good thing when the head of a criminal cartel endorses you.

  • loveconstitution1789||

    Its not a full endorsement, as the Democratic Party still has his wallet in lock down.

  • Mark22||

    Trumka's some-pain-now-for-gain-later argument would carry more weight if Trump had clear, achievable goals

    Reduction of Chinese and European trade barriers and government subsidies, and a reduction of the US trade deficit seem both clear and achievable to me.

  • MWG||

    By US trade deficit, I assume you mean capital surplus, right?

  • vek||

    You mean the thing where we sell off valuable long tern value assets to foreign owners in exchange for consumables that mostly lose their value the second you take them out of the store?

    The one where trillions in assets more are now owned by foreigners than US citizens own abroad? Even though we used to be the one that owned the trillions in foreign assets? Yeah. Net worth matters in the long term. Anybody who doesn't get that you can't consumer everything you produce AND MORE forever is a moron. You at least need to balance you production with consumption, or else you will go broke sooner or later. If you want to really build wealth you produce more value than you consume and invest the difference.

  • mondo_cane||

    I agree with your points. But how does the US "free market" compete with the European countries and others that are subsidized by their governments to the fullest extent possible?

  • BYODB||

    In other news, Dog Bites Man.

  • mondo_cane||

    Maintaining a balance among business, working men, and consumer prices is a very difficult thing. Tariffs are one of the more familiar ways of slowing trade between countries, or ultimately, stopping it.

    Domestic interstate tariffs charged by the individual States were one of the earliest forms of tax on domestic commerce and were partly responsible for creating the rift between the Northern States and the Southern States and consequently were a cause of our so-called civil war.

    Since the Southern States were agrarian there was a need for the trade of hard goods from the industrialized North. Raising the tariffs for export/import to the Northern States sealed the fate of the nation.

    While I believe Trump is doing many good things for America, tariffs are not helping America's businesses, and retaliatory measures taken by other countries (Europe for example) are straining our relations with them (see mention of this in the article.)

    This is not a good thing.

  • Enemy of the State||

    Agree - if Trump was a true pro-free trade and open immigration POTUS along with his pro-liberty views on taxes & regulation and his solid judicial agenda, the Reps would be cruising to an easy November and he'd be a shoe-in for a second term...

  • No Yards Penalty||

    When did these comments threads get over-taken by Trump's cock-gobblers?
    Is sarcasmic that last actual libertarian left around here?

  • Enemy of the State||

    I'm here - tariffs suck and Trump is an economic idiot...

  • loveconstitution1789||

    No sarcasmic is an anarchist.

    He wouldnt know libertarianism if bastiat was swinging a free market bat of unicorn hooves.

  • Enemy of the State||

    Incoherent pro-tariff babble from a union goon...

  • loveconstitution1789||

    Unions and Trump are not friends.

  • B Wilds||

    Trade policy has massive long-term ramifications on the strength of a nation's economy. Often people fail to note the difference between free and fair trade. In many ways, the global economy has become an ill-regulated business model tilted to favor big business and giant conglomerates. We should not lose sight of the fact that while free trade is important, fair trade is far more so and should be the main issue.

    Developing a long-term sustainable economic system that is balanced would contribute to both global cohesion and the world economy. The article below is in response to a slew of comments from my recent article titled, "Higher Prices On Import Goods A Fair Cost For Jobs". Today many people supporting past trade agreements mistakenly use low consumer prices as a battle flag around which to rally.

    http://brucewilds.blogspot.com.....e-are.html

  • librich||

    I was personally involved with two businesses that were irreparably harmed by unfair trade practices by China and France. Fair trade is a two-way street. Trump seems sincere in his attempts to remove unfair tariffs. Reason's Chicken Little response to his negotiating tactics are not resonating with me, and I see a lot of other folks are having the same reaction.

  • librich||

    Most of the negative response to Trump's attempts to negotiate fairer trade deals probably comes from people who have no experience with international trade.

  • alfachemistry22||

    The US Government sets the trade policy.

    The Chinese Communist Party sets the trade policy.

    The EU Committees set the trade policy.

    Trump at least wants free trade where the TOP MEN dont decide every facet of trade.

    http://www.cheapjcsuits.com/

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