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I can't believe I'm going to say this - - but is Trump smart enough to be like Bush and abandon the tariffs when they start harming Americans?
The problem is many voters will like the idea of protecting US steel and jobs when in fact in reality more US jobs may be lost.
The EU plays it's games as well, and you can see from the list of tariffs which include iconic American brands as well as a lot of agricultural produce. These tariffs are going to be designed to hit Trump seats, with tariffs on Orange Juice, , Peanut Butter, Bourbon etc designed to target the Southern red states, whilst a Cranberry tariff will hit agriculture in the rural North of the US. Whilst tariffs on iconic brands such as Harley Davidson, Levi Jeans, Jack Daniels, Jim Beam etc are also designed to send a message to Trump.
The trouble for Trump is the EU and other countries will respond to everyone of his tariffs with a tariff that will hit an area of the US that is a marginal key states or a Trump heartland. People in the cities are often far more liberal, and Trump's heartlands include area that rely heavily on agriculture, and China will also be aware of this in relation to the US Soy Crop, with China being the main customer when it comes to US Soybeans.
Bush was not exactly the smartest US President ever but even he realised that the targeting of oranges by the EU was going to cause him problems when it came to the vote, as Florida a key election state is one of the main orange and orange juice producers.
Trump hasn't quite twigged on as to what the outcome of all of this will be, but he will eventually.
Last edited by Brave New World; 03-09-2018 at 10:42 AM..
There may be a few cars imported from China. But to me the bigger point is that free trade is good for everyone.
But we don't have free trade. What you are saying is you are fine with China putting tariffs on whatever they choose but if we put tariffs on steel and aluminum we are the ones that are wrong.
Just go to walmart and looks where almost everything is made and tell me this is free trade.
There may be a few cars imported from China. But to me the bigger point is that free trade is good for everyone. Take cars as an example:
I remember the 1980's, when Japanese car makers started really taking market share in the US. It was a huge threat to the US Big 3 auto companies. We could have slapped huge tariffs on the Japanese in order to protect US products.
But look where we are today. Most of the Japanese cars sold in the US are assembled here, providing millions of American jobs. The quality of these products is excellent, and the challenge caused American manufacturers to greatly improve the quality of their own products. Win/Win.
Huge tariffs were slapped on the Japanese. It forced the Japanese to relocate their production.
The problem is many voters will like the idea of protecting US steel and jobs when in fact in reality more US jobs may be lost.
Trump hasn't quite twigged on as to what the outcome of all of this will be, but he will eventually.
Here is what I think is going to happen. Trump carved out Canada, and Mexico, our #2, #3 largest trading partners. The other big ones are China, and the EU. He made it clear that each country's tariff would be negotiated INDIVIDUALLY. Many of these countries have taken advantage of the U.S. with high tariffs for decades, that is why our trade deficit is so large. Trumps goal is to get them lowered to a more "fair" level. If they lower there's, our tariffs will go back down. He is just using the carrot, and stick approach.
Equilibrium will eventually prevail. There will be no "trade war".
There may be a few cars imported from China. But to me the bigger point is that free trade is good for everyone. Take cars as an example:
I remember the 1980's, when Japanese car makers started really taking market share in the US. It was a huge threat to the US Big 3 auto companies. We could have slapped huge tariffs on the Japanese in order to protect US products.
But look where we are today. Most of the Japanese cars sold in the US are assembled here, providing millions of American jobs. The quality of these products is excellent, and the challenge caused American manufacturers to greatly improve the quality of their own products. Win/Win.
true, and just look at how awful and unreliable American cars are, still.
Being able to buy Japanese cars is a HUGE benefit to American consumers.
A bit of Deja vu about all of this or do you not recall when the US steel tariffs of 2002 which led to the loss of 200,000 jobs and $4 Billion in wages, before they were quitely abandoned.
A tariff only intended to last a few years will do no good. No one is going to invest in a factory and hire workers only to have to face foreign competition when the tariff expires.
Here is what I think is going to happen. Trump carved out Canada, and Mexico, our #2, #3 largest trading partners. The other big ones are China, and the EU. He made it clear that each country's tariff would be negotiated INDIVIDUALLY. Many of these countries have taken advantage of the U.S. with high tariffs for decades, that is why our trade deficit is so large. Trumps goal is to get them lowered to a more "fair" level. If they lower there's, our tariffs will go back down. He is just using the carrot, and stick approach.
Equilibrium will eventually prevail. There will be no "trade war".
The trade deficit is not large and it is not a problem. Countries with trade deficits are not any poorer or richer than countries with a trade surplus. Its a complete red herring.
true, and just look at how awful and unreliable American cars are, still.
Being able to buy Japanese cars is a HUGE benefit to American consumers.
...and Japanese workers.
American cars now are just as reliable as Japanese cars and were so at various times in the past. And Japanese cars were crappy at various times in the past. If a closed market is bad for reliability, how do you explain that Japanese cars are reliable, considering Japan is a fairly closed market to foreign cars?
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