Trump’s Tariff Strategy: US can no longer act as the world's economic shock absorber

[stevenl]

2 hours ago, BritScot said:

Trump was quite in his right to reciprocally tax them but he could easily have doubled the tax. Use do realise that he is only hit them with 50% of the tax they hit they issue against American goods? I

Nonsense.

[coolcarer]

3 minutes ago, stevenl said:

Nonsense.

Why?

[Digitalbanana]

3 minutes ago, coolcarer said:

Why?

 

 

.... the biggest policy mistake in 95 years!

[stevenl]

3 minutes ago, coolcarer said:

Why?

Not even close to reciprocal.

[coolcarer]

1 minute ago, stevenl said:

Not even close to reciprocal.

Nonsense. Read the post you responded to. See if you understand it

[norsurin]

China just put 34% on US.Figthing back.

[PuiPuiHarry]

11 hours ago, ChicagoExpat said:

Yes, he's a scam artist.  But why should any country put up with their goods being taxed while they have allowed the other country's exports, tax-free, for decades?

Please show me ONE country, where the EXPORT is taxed. The IMPORT.. yes, many.

 

Every country needs income to pay their State bills. Many countries use income, VAT, company profit etc taxes + some import duty. In Thailand, the source of import duty is very important, as...other taxes are much more difficult to get in.

As far as I now, EXPORT tax is levies very seldon, but IMPORT tax often. So, when US goods to go TH, they are NOT taxed in the US as export, but info Thailand as Import. Same the other way round. When Trump, in is unendness and always 100% correct wisdom, decides to increase the IMPORT tax of Thai goods into the US, he hopes the next day the US is able to replace these import goods with domestic production, if companies have production facilities and -lines ready the next day. If not, the imported products will increase in price, at least the amount of import duty is levied on it, so Thai goods a + 37 % when inside the US.

I am sure, the pineapple etc production will be grown overnight, so for pineapple the US consumer will have not any disadvantage. ( of has to switch to US grown foods, which is already abundant, therefore no food imports ever into the US).

In this example, because Thai pineapple will be a lot more expensive, US consumer will buy less, and Thailand will export less to the US.

His Unendless Lying Wishdom forgets, other nations might react with IMPORT tariffs on US products into their countries. Imagine a 25 % import duty on all US produced commercial palanes... Airbus will thank the Trump-the Lyer administration for over a century

Second: when their income drops because of less exports to the US, they lack the money to pay for US products.

 

And maybe, as Thailand gets less revenues, they will levy a visa-amount , for instance: for every day an US citizen stays into Thailand, has to pay … e.g. a 5000 THB to compensate their use of Thai legal system ( protection against robbery = police, law system), for the use of infrastructure ( roads, trains etc), and a lot more.

[PaoloR]

So many truly deluded people. Once you lose your manufacturing base it is never coming back. How long will it take to re-build manufacturing? Who is going to pay for it? Where is the labor going to come from? How many products are going to be even close to competitive at US labor cost? AI doesn't make things. it is not the solution to this problem as many seem to believe.

Plus - the biggest single con is looking only at consumables and not balancing it against services. For example, is Google tariffed? The money income flow from banking, insurance and so many service industries needs to be balanced against the outflow from purchasing consumables. Looking at only one side of the equation, then jumping on to tariffs as a means of miraculously bringing non-competitive manufacturing back to the U.S. is pie in the sky.

The solution should have been to offshore manufacturing as it became uncompetitive and relocate the machinery and expertise to owned subsidiaries in low-cost countries. It worked for the Japanese and is now working for the Chinese. The USA which suffers badly from short-termism was not able to take the long-term view on offshoring and provide the finance to build elsewhere. It leapt at short-term profit taking and now thinks it can rectify the situation with tariffs.

[PuiPuiHarry]

1 hour ago, coolcarer said:

Why?

Just look into the REAL customs duty/tariffs lists, see for the EU  https://ec.europa.eu/taxation_customs/dds2/taric/taric_consultation.jsp?Lang=en and NOT in the lying list of Trump "grab them by the pussy" president of the USA ( in any normal country you would go in jail. Only in the USA you can be elected to president of the nation.)

[thaibeachlovers]

8 hours ago, uncletiger said:

Economists like to point out that free trade makes everyone better...on average. It's the on average part that is the problem. Because as Trump has told us, 50 years of data clearly show the vast, vast majority of Americans are worse off. Free trade works by pulling wealthy countries down to the same level as impoverished ones, while making a few who control the global supply lines very, very wealthy. In the process, those countries who were desperately poor might experience a slight increase in their standard of living, but again that came at the expense of the US which experienced a much more significant decrease.

Great post, especially the bit about making a few who control the global supply lines very, very wealthy. I had been going to post something similar but you beat me to it.

Globalisation, IMO, is built on BS by the 1% that use it to exploit poor workers in Asia to make inferior products that are sold at a large profit in western countries by the same people that exported all the jobs to exploit the poor overseas.

I suppose it's too much to hope that the 1% will suffer if they lose their exploited workers, but I expect they will simply build automated factories in the US to make inferior products to be sold at a substantial profit- business as usual.

 

IMO Globalisation is corrupt and rotten to the core, and I hope it is burned to the ground ( figuratively ). If Trump is the man to light the fire, kudos to him for that.

[thaibeachlovers]

5 hours ago, PuiPuiHarry said:

Just look into the REAL customs duty/tariffs lists, see for the EU  https://ec.europa.eu/taxation_customs/dds2/taric/taric_consultation.jsp?Lang=en and NOT in the lying list of Trump "grab them by the pussy" president of the USA ( in any normal country you would go in jail. Only in the USA you can be elected to president of the nation.)

Enjoy the next 3 1/2 years- I will.

[thaibeachlovers]

12 hours ago, Dirk Z said:

But when Trump does it, everyone loses their marbles. 😄 

Just like the self-proclaimed economic genius himself.

If every insult leveled at Trump was a brick, we could build a road to the moon!

I suppose insults are all they have now, considering their candidate was so incredibly bad.

[kwilco]

Trump isn't interested in the economics of tariffs - they are a political too. The World may be heading for a “trump slump” – but for Trump, it is a political measure to get businesses and countries to cow tow to him. It’s a power grab where everyone has to negotiate with Tump. He’s already said he’s going to try for a 3rd term – an impoverished world is easier for him to manipulate – or so he thinks

 

However, he seems to have underestimated the ability of the  the world  to ignore him – the's terrified of big economic or poitical blocs, this is why he’s so keen to divide Europe – e.g. Brexit and Putin in Ukraine. People are coming round to new alignments – a Canada EU block, an Asean bloc and Idia, even China.

 

America can’t make all the stuff currently made abroad – it would take decades to set up  (Trump knows and doesn’t care) and then for his smaller market, ( he can't sell it abroad, it will be too dear.  Also the economies of scale would set in and they will flounder. In the meantime other countries in the world are well placed to pick up the slck with US products out of the way. By the midterms the failure will be overly apparent and Trump will invent some “national crisis” followed by a state of emergency and eventually cancel elections at the end of his term.

[impulse]

16 hours ago, thaibeachlovers said:

16 hours ago, newbee2022 said:

Who wouldn't agree? 

However, I can't see the reset button yet. 

Neither can I, sadly. It has ever been so- the 1% rip off the poor, at least till the tumbrils await.

 

FDR hit the reset button when he raised to top marginal tax rate to 90%, claiming (and I'm paraphrasing here...) "You rich people broke the economy, you're going to pay the bill to fix it".  And America had its most prosperous decades, until they lowered that top marginal rate.

 

 

[newbee2022]

19 minutes ago, impulse said:

 

FDR hit the reset button when he raised to top marginal tax rate to 90%, claiming (and I'm paraphrasing here...) "You rich people broke the economy, you're going to pay the bill to fix it".  And America had its most prosperous decades, until they lowered that top marginal rate.

 

 

And you think these prosperous decades will start now?

 

[impulse]

2 minutes ago, newbee2022 said:

And you think these prosperous decades will start now?

 

Doubt it.  JFK's assassination showed what happens when you get between the rich and their money.

 

[CallumWK]

https://finance.yahoo.com/news/the-white-house-cited-these-economists-to-justify-its-tariffs-they-arent-thrilled-193615537.html

 

The White House cited these economists to justify its tariffs. They aren't thrilled.

The researchers took issue with some shortcuts and questionable math by the Trump administration.

 

A few of the notes jokingly congratulated him. But how did he really feel? “Confused,” Soderbery told Yahoo Finance. After all, he said, his study had been written to discourage exactly the kinds of policies Trump was rolling out. Certainly, nobody from the administration had consulted with him.

“I don’t want it to turn into infamy,” Soderbery added, laughing.

Soderbery isn’t the only economist with qualms about how their work was used as part of the White House tariff push. And while the complaints of a few academics might not seem significant compared to, say, the stock market’s panicked stampede this week, they do raise questions about the rigor that went into planning America’s most sweeping import taxes in over a century.

[newbee2022]

3 minutes ago, impulse said:

 

Doubt it.  JFK's assassination showed what happens when you get between the rich and their money.

 

I'm afraid, US will be isolated. Trading bonds between BRICS, EU, MERCOSUR, ASEAN will get stronger. Inflation, unemployment, interest rates rising, and the trust into America as an anchor of freedom will go down the river, democracy only a signboard.

[LarryLEB]

In your last 

17 hours ago, Eric Loh said:

I wondering if Trump know that US has a trade surplus in the service industry. Service industry growth outpaced real GDP growth. Over 1 trillion USD in services are exported. The service sector has been declining with Trump's trade policy uncertainties and now the tariffs will be a hammerblow as recessionary and global growth fears weigh on the sector. Trump is reckless and don't grasp the totality of his tariff war which will drive down the world economy. He is surrounded by sycophants and cowards who are gutless to speak out.  

In your last sentence, the perfect word for those gutless ones:  lickspittles.

[thaibeachlovers]

1 hour ago, newbee2022 said:

the trust into America as an anchor of freedom will go down the river, democracy only a signboard.

America doesn't put much store by democracy when it's other countries. How many dictators has the US supported in my lifetime- quite a lot.

It's used quite a lot to support it's wars though, but only lip service, and that's only till they depart leaving the dead and destruction for someone else to clean up.

[newbee2022]

6 minutes ago, thaibeachlovers said:

America doesn't put much store by democracy when it's other countries. How many dictators has the US supported in my lifetime- quite a lot.

It's used quite a lot to support it's wars though, but only lip service, and that's only till they depart leaving the dead and destruction for someone else to clean up.

You're absolutely right. So the last bit of reputation is going to the bin.

It's sad to see that values, America was standing for are vanishing now.

I'm not sure what answer the surrounding world will have. Probably not clapping hands.

[thaibeachlovers]

17 minutes ago, LarryLEB said:

Trump is reckless and don't grasp the totality of his tariff war which will drive down the world economy.

If the world economy depends so entirely on the US, then something has gone very very wrong in the world order.

Seems that all those economists don't actually know half as much as they claimed to know.

 

IMO it's a rotten construct that was designed to enrich the 1%, and they will be poised to make even more money in the future as they buy up companies at firesale prices.

 

If it's so fragile then it was going to fail sooner or later- it just happens to be now.

 

Given I've always been screwed over by the economy and the grasping IRS, it's not going to be much different for me from normal. Might affect those foolish enough to get themselves into huge debts though.

[BigBilly]

16 hours ago, SunnyinBangrak said:

I'm still confused by the fact that every single countty around the world imposes tariffs on imports and benefits from it. Yet if the USA imposes tariffs like all the other countries it is disastrous for Americans

Do you seriously think those numbers that Trump showed on his silly childish chart were the tariff rates countries charge the US?  

 

Those rates are something Trump made up in his head and were based on the trade deficit, and had nothing to do with the tariff rate countries charge the US.

 

https://taxfoundation.org/blog/trump-reciprocal-tariffs-calculations/

 

[thaibeachlovers]

1 minute ago, newbee2022 said:

You're absolutely right. So the last bit of reputation is going to the bin.

It's sad to see that values, America was standing for are vanishing now.

I'm not sure what answer the surrounding world will have. Probably not clapping hands.

I've come to realise that everything ends sooner or later, and since Vietnam things only get worse. The 50s were the best years for western prosperity, but that's all gone. Now it seems that populist policies to buy votes has resulted in a facade that was covering up a catastrophe in the making- eg the US debt is unsustainable, and the whole rotten farce is going to be exposed.

 

My generation had the best of it, but the party is over. It's been real, but it's going, going and soon to be gone.

 

Perhaps the economists of the future will realise that a proper economy can't be built on BS

[newbee2022]

18 hours ago, BritScot said:

The haters on here really are close to crazy. You all should sit back and digest the bile use all spout. This forum must be so full of billionaires with such business and success portfolios! So, use all support corruption and theft of trillions of tax payers money, tax payer's money being used to pay for terrorists and agitators, countries theft of manufacturing with crazy tariff structures. Trump was quite in his right to reciprocally tax them but he could easily have doubled the tax. Use do realise that he is only hit them with 50% of the tax they hit they issue against American goods? I think he should of hit them with equal tariffs especially China!

Is it nonsense or a joke? Nor even funny or entertaining unfortunately. Only <deleted>

[newbee2022]

3 minutes ago, thaibeachlovers said:

I've come to realise that everything ends sooner or later, and since Vietnam things only get worse. The 50s were the best years for western prosperity, but that's all gone. Now it seems that populist policies to buy votes has resulted in a facade that was covering up a catastrophe in the making- eg the US debt is unsustainable, and the whole rotten farce is going to be exposed.

 

My generation had the best of it, but the party is over. It's been real, but it's going, going and soon to be gone.

 

Perhaps the economists of the future will realise that a proper economy can't be built on BS

Not many will agree with the truth. 👍

[Dan O]

20 hours ago, candide said:

Remind me. Who's the guy who torpedoed the FTA between the EU and the US, because it's been negotiated by the Obama administration! 

Same with the Canadian TA he negotiated last term that now he claims was so badly done. He's truly a moron

[thaibeachlovers]

6 minutes ago, BigBilly said:

Do you seriously think those numbers that Trump showed on his silly childish chart were the tariff rates countries charge the US?  

 

Those rates are something Trump made up in his head and were based on the trade deficit, and had nothing to do with the tariff rate countries charge the US.

 

https://taxfoundation.org/blog/trump-reciprocal-tariffs-calculations/

 

Do you seriously think those numbers on anyone's chart mean diddly squat any more? Short of Trump being removed from power and a traditional BS promoting POTUS installed it's full steam ahead, and where we end up nobody knows.

Don't forget that Trump was elected to burn the old system down ( seems a lot of people didn't take him seriously- their mistake ).

 

I'm somewhat bemused at how fast the old order is collapsing, but that's what happens when the system is built on greed.

 

Seems to me there are only 2 ways ahead- either Trump is removed, the old order re installed to collapse later, or Trump destroys it and something new emerges to take it's place.

OR, the entire "crisis" is just a load of cobblers and we'll be back to business as usual once the 1% get their greedy fingers well and truly into the pie.

[BigBilly]

3 minutes ago, thaibeachlovers said:

Seems to me there are only 2 ways ahead- either Trump is removed, the old order re installed to collapse later, or Trump destroys it and something new emerges to take it's place.

The third option is the Republican sheep in congress could grow a spine and assert their authority.  Under the constitution, a president of any party does not have this much power.  Congress could easily stop this madness if they choose.

 

Which option is more likely, I don't know.

[thaibeachlovers]

8 minutes ago, newbee2022 said:

Not many will agree with the truth. 👍

Given the amount of personal debt that many people have acquired, they can't afford to believe that the party is over. IMO that's where the real pain is going to be- if they lose their jobs because of the decline in world trade, they are seriously up the brown coloured creek without a paddle.

 

Given that my pension is paid to me out of current taxation, I'm also going to be up the brown creek in the same canoe if mass unemployment eventuates. Given China is our main export market, if they fall over, we are probably all going to be up the creek. So I'm just as much at risk as any American if it all goes horribly wrong.