Originally Posted by Maurice Clark
Hi Rod,
Got to agree. dickie dodgeball is just parroting right-wing spin. And you do have to wonder if he really does have any investments in stocks. Stockmarkets around the world took a massive hit yesterday. Here is an excerpt from yesterday's editorial of that bastion of left-wing pinko conspiracies The Economist:-
"Almost everything Mr. Trump said this week—on history, economics and the technicalities of trade—was utterly deluded. His reading of history is upside down. He has long glorified the high-tariff, low-income-tax era of the late-19th century. In fact, the best scholarship shows that tariffs impeded the economy back then. He has now added the bizarre claim that lifting tariffs caused the Depression of the 1930s and that the Smoot-Hawley tariffs were too late to rescue the situation. The reality is that tariffs made the Depression much worse, just as they will harm all economies today. It was the painstaking rounds of trade talks in the subsequent 80 years that lowered tariffs and helped increase prosperity.
On economics Mr. Trump's assertions are flat-out nonsense. The president says tariffs are needed to close America's trade deficit, which he sees as a transfer of wealth to foreigners. Yet as any of the president's economists could have told him, this overall deficit arises because Americans choose to save less than their country invests—and, crucially, this long-running reality has not stopped its economy from outpacing the rest of the G7 for over three decades. There is no reason why his extra tariffs should eliminate the deficit. Insisting on balanced trade with every trading partner individually is bonkers—like suggesting that Texas would be richer if it insisted on balanced trade with each of the other 49 states, or asking a company to ensure that each of its suppliers is also a customer."
They also denounced Trump's trade war as "the most profound, harmful and unnecessary economic error in the modern era."
What he's doing is entirely bonkers. It will not bring back manufacturing to the US or lower prices. These reciprocal tariffs are also equally insane. We must import stuff because we don't make it or have enough of it. Coffee from Central and South America and lumber from Canada come to mind. Even if we opened every national park for logging, we could never produce enough lumber to sustain our building and construction commerce. So, imposing tariffs there merely because you see a trade deficit is simple-minded and naive. Every case of trade needs to be examined and considered on its merit. The tariffs are not even "reciprocal." Instead, they are being imposed simply because there is a trade deficit, regardless of whether or not that trade imbalance is logical or benefits us. A trade imbalance does not inherently mean the other country cheats us. This policy is reckless and careless and will cause unnecessary pain.
Several things can happen now. One is that they can soon realize what a mistake they have made and roll back or not implement these tariffs. They will probably try to spin it as, "We had to roll them back because the American people weren't willing to take one for the team." Another is they can double down, drive us into a recession with high inflation, and then when the economy does finally recover, they can claim, "See, we told you it would work!" Lastly, they could do something in between with various amounts of spin and gaslighting regarding how they knew what they were doing or that the outcome was not their fault. Even if you agree with their objectives, even a bit of common sense should tell you this is an awful way to achieve them.
