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Nearly all ideologically conservative economists and publications disagree with Trump on trade and protectionism.
Here is Scott Lincicome from the Federalist.
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There really is no sugarcoating it: almost everything that Donald Trump has proposed on U.S.-China trade—for example, during last Thursday night’s GOP debate, in a recent the New York Times interview, and on his website—is wrong.
The staunchly conservative Cato Institute disagrees with Trump.
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So the argument seems to be this: There are good trade agreements that lead to trade surpluses and bad trade agreements that lead to trade deficits. A good negotiator can get you an agreement with a surplus; with bad negotiators, you will end up with a deficit. In reality, this is complete nonsense.
But Trump’s advisers don’t realize that, probably because they don’t really know much about the substantive details of trade agreement. They are simply looking at U.S. trade deficits or surpluses that arise after the fact, which generally matter very little (as my colleague Dan Ikenson has explained), and certainly don’t matter much at all in the context of trade between the U.S. and individual countries.
The Heritage Foundation, a deeply conservative think tank and free market economy champion, responded this way to Mr. Trump’s attacks on Reagan’s NAFTA initiative:
“On average, citizens of the U.S. have been better off with the North American Free Trade Agreement (NAFTA) than they would have been if the trade rules for the U.S., Canada, and Mexico prior to NAFTA had remained in place.”
“One hundred percent of the economists who had an opinion agreed that citizens of the U.S. have been better off with NAFTA than we would have been without it.”
Here is the National Review on "The Economic Stupidity of the Carrier Bailout"
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But the math is the math is the math. Trump and Pence are trying to sell you a free lunch, the same way the Keynesians and their magical spending multiplier do when they promise that government stimulus programs (Trump is pushing one of those, too) will somehow magically pay for themselves. There is no magical revenue fairy. And, as a budgetary matter, targeted tax benefits are identical to spending, both for the government and for the beneficiary. This is not a question of ethics but a question of accounting. Somebody always has to pay the bill, eventually. It probably won’t be the pop-con on the radio telling you that we can make money by giving it away, so long as we give it away to the right sort of people: Solyndra bad, Carrier good. Conservatives have a hard enough time of it as it is without inflicting needless stupidity on themselves.
As for the TPP, he claimed it would be the death blow for American manufacturing. Here, he is summoning his best Bernie Sanders populist scare-mongering rhetoric. In fact, failure to ratify the TPP would benefit one country only- China, his other bogeyman. The TPP represents the greatest potential economic weapon the US has in Asia- the largest emerging market. If we trade more on a more even playing field (the TPP abolishes over 18,000 tariffs on US goods), then it benefits American manufacturers and their workers.
Tough question. We certainly need and want trade. For example, in Arizona we heavily trade with Sonora, Mexico and are in the midst of creating our own economic region, Trump's brand of isolationism would actually hurt a lot of that. For example, we just landed a car manufacturer that wants to compete with Tesla. The menial work comes from Mexico and the Design and Manufacturing comes to Arizona.
On the other hand an economy that only services and doesn't produce is subject to boom/bust cycles and subjects a large chunk of the population to low wages or no wages. One of the reasons Greece collapsed in the EU is because they don't create anything and after being subjected to the Euro they were unable to manipulate their own currency to deal with economical cycles.
So like all things, it's all about striking a balance.
The painful truth, painful most to those of us who really wish it were otherwise, is that conservatives (small government, free traders, not nutball religious warriors) are right about many things including this.
On the other hand an economy that only services and doesn't produce is subject to boom/bust cycles and subjects a large chunk of the population to low wages or no wages. One of the reasons Greece collapsed in the EU is because they don't create anything and after being subjected to the Euro they were unable to manipulate their own currency to deal with economical cycles.
Manufacturing employment has a higher share in Greece than it does in the U.S. Only 8% of American workers are employed in the manufacturing sector.
The U.S. obviously weathered the global recession better than the manufacturing-based economies of the developing world.
And manufacturing output is actually up in the U.S. We simply need fewer workers to make more stuff.
Manufacturing employment has a higher share in Greece than it does in the U.S. Only 8% of American workers are employed in the manufacturing sector.
The U.S. obviously weathered the global recession better than the manufacturing-based economies of the developing world.
And manufacturing output is actually up in the U.S. We simply need fewer workers to make more stuff.
Right...
We have our own currency we can manipulate, they did not. In fact we did just that and they could not. When they felt a bust cycle they could not do anything about it. We did the opposite.
You sure like misreading my posts there Baja. Whatever this spat is you have you just gotta get over it.
We need more protectionism. Unless trade/visa agreements are bilateral, current trade agreements tend to favor the foreigners, because they gain more access to the pool of jobs in the US. Meanwhile, Americans almost never reap the same advantages in other countries, because they actually care about prioritizing their own citizens when it comes to jobs.
Honestly, it shouldn't even be labelled "protectionism", because everywhere else, it's simply considered common sense.
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