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Trump is obviously of the opinion that he can wait out the Chinese and win in the long term.
If you follow the money, here's where I get.
We make products here and sell them here. China makes products and exports them here. China's cost structure is cheaper than our costs. How can that be? Our products should be cheaper here than another country who sends them from halfway across the globe.
So either the costs of our products are too high, or theirs are too low.
Tariffs make the cost of products go up... so with regards to China, it makes their cost more equal to our costs. In that sense - it will cost us more money.
Maybe our costs to make products are too high. Maybe too many regulations? Maybe taxes are too high? Maybe instead of going through tariffs, we should change what we do to make the costs lower and make it more cost efficient for companies to manufacture here. Why not make it more cost efficient to buy American?
There is no way we should have a huge trade deficit with any country - especially over a long period of time.
The American economy can absorb higher prices than China and do it for longer. Trump is using a stronger economy to the US advantage by pressing a deal from a position of relative strength.
It was always going to have short term pain involved, but everyone griping about outsourcing, offshoring, globalization, fair wages, blah blah...on both sides...this is what leveling the playing field was always going to have to look like. There's no painless way to get that economic advantage back on our side of the Pacific, but there is an effective way to do it, and Trump is doing just that.
I don't agree wit either economic nationalism or its resulting tariff slings & arrows, because I think capital should flow where it hits the least resistance an thus does the most good in the most efficient manner, but from an economic competition standpoint of nation v nation and changing around the pecking order, Trump is following the playbook properly to achieve a position of greater dominance for the US.
Anyone thinking this was going to be easy or quick is ignorant or delusional. If you want the field leveld, you need to do the hard work or tearing up the ground, grading, tamping, rolling, etc. Doesn't just level itself on wishes and unicorn dust.
Wouldn't that raise prices world wide?
Soybeans in the US sold for $8/bushel and Trump put a 25% tariff on China, making them $10 there. So if you were the "king of Brazil", how much would you sell your soybeans for?
Ans: Not $8.
Funny how the left hates tariffs but wants to raise taxes on companies.....somehow the think something different will happen to the taxpayer....
Tariffs are costs passed from importers onto consumers. Because of market principles, tax cuts do not get passed along to the consumer. Its simple, really.
Funny how the left hates tariffs but wants to raise taxes on companies.....somehow the think something different will happen to the taxpayer....
Somehow they just twist themselves around so that they can believe if you raise taxes on corporations, then corporations will hire more people....
Beats me..
Trump is obviously of the opinion that he can wait out the Chinese and win in the long term.
If you follow the money, here's where I get.
We make products here and sell them here. China makes products and exports them here. China's cost structure is cheaper than our costs. How can that be? Our products should be cheaper here than another country who sends them from halfway across the globe.
So either the costs of our products are too high, or theirs are too low.
Tariffs make the cost of products go up... so with regards to China, it makes their cost more equal to our costs. In that sense - it will cost us more money.
Maybe our costs to make products are too high. Maybe too many regulations? Maybe taxes are too high? Maybe instead of going through tariffs, we should change what we do to make the costs lower and make it more cost efficient for companies to manufacture here. Why not make it more cost efficient to buy American?
There is no way we should have a huge trade deficit with any country - especially over a long period of time.
with China its a bit more sinister. they manipulate their currency and use that to offset the cost of production. they also subsidize their companies so they make money even while undercutting production costs with their trade partners.
they also control wages artificially low.
Their actions are highly predatory and not based on any free market reality. THat doesn't even begin to deal with what China does in terms of taking intellectual property, stealing technology, demanding companies that do business in China hand over valuable and proprietary information.
If we don't deal with this now, China will destroy our economy eventually. what Trump is doing is dealing with a nation that has been in a Trade war with us for 30 years.
What our liberal friends in this thread are doing is trying to pretend that by not engaging in the trade war with China, we aren't in a trade war.... its a form of insanity.
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