Trade Wars and Tariffs

#1,352
#1,352
lawgator1 said:
Interesting question, have to think about it. But I get your larger point that corporate tax rates can be manipulated to incentivize corporations to move or base elsewhere.

One initial point I'd make is that a corporate headquarters is not necessarily where manufacturing is -- in fact I'd go so far as to say the larger ones are never in the same place.
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That’s not entirely my point. But it is related. More so my point is that a global corporate tax also gets passed on to the consumer in the form of inflation the same way as tariffs.

So if you oppose tariffs due to inflation, it would be logical to oppose corporate taxes also. Especially on a global scale.
 
#1,357
#1,357
hog88 said:
You should take your own advice, start here.

NAFTA’s Impact on the U.S. Economy: What Are the Facts?.
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Am I missing something here, Juicebox?

Per your article:

“While conceding that many U.S. high-wage manufacturing jobs were relocated to Mexico, China and other foreign locations as a result of NAFTA, Morris Cohen, Wharton professor of operations and information management, argues that NAFTA has, on balance, been a good thing for the U.S. economy and U.S. corporations. “The sucking sound that Ross Perot predicted did not occur; many jobs were created in Canada and Mexico, and [the resulting] economic activity created a somewhat seamless supply chain — a North American supply chain that allowed North American auto companies to be more profitable and more competitive.”
 
#1,360
#1,360
lawgator1 said:
Right, and yes, if anything wages will rise.

Fact is, the World is such that the US benefits greatly form cheap labor and costs of production worldwide. The fact that we are now a service oriented economy is inescapably true.

I lament that fact all the time, but the fix is not to belligerently torpedo the US and world economies out of frustration or resentment.

Reagan:

President Ronald Reagan, who held office from 1981 to 1989, was a young man during the Great Depression.

Reagan spoke about how, at first, tariffs seem like a good idea, then said:

“For a while it works, but only for a short time.

“What eventually occurs is homegrown industries start relying on government protection in the form of high tariffs.

“They stop competing and stop making the innovative management and technological changes they need to succeed in world markets.


“Then, while all this is going on, something even worse occurs.

“High tariffs inevitably lead to retaliation by foreign country and the triggering of fierce trade wars.

“The result is more and more tariffs. Higher and higher trade barriers and less and less competition.

“So, soon, because of the prices made artificially high by tariffs, that subsidize inefficiencies and poor management, people stop buying.

“Then, the worst happens, markets shrink and collapse, businesses and industries shut down and millions of people lose their jobs.
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The issue with all of that is that there is a proven system of tariffs that worked. It was the USA Economy from 1790s until 1880s. Alexander Hamilton, one of the Founding Fathers, spearheaded a tariff system that helped develop the local US Economy.

I can agree that Trump has gone overboard with it but to say Tariffs have no grounds in history of working is incorrect. (Not sure if you are saying that but a lot are in this thread).

To me, our tariffs should only be directed at the low labor nations (mainly China). I also don't think it will work unless we can invite friends to join us and follow the same process. I don't think that we have unfair advantages against Canada, the EU, Australia, Japan, etc. There is no need to tariff those nations.
 
#1,362
#1,362
lawgator1 said:
Right, and yes, if anything wages will rise.

Fact is, the World is such that the US benefits greatly form cheap labor and costs of production worldwide. The fact that we are now a service oriented economy is inescapably true.

I lament that fact all the time, but the fix is not to belligerently torpedo the US and world economies out of frustration or resentment.

Reagan:

President Ronald Reagan, who held office from 1981 to 1989, was a young man during the Great Depression.

Reagan spoke about how, at first, tariffs seem like a good idea, then said:

“For a while it works, but only for a short time.

“What eventually occurs is homegrown industries start relying on government protection in the form of high tariffs.

“They stop competing and stop making the innovative management and technological changes they need to succeed in world markets.


“Then, while all this is going on, something even worse occurs.

“High tariffs inevitably lead to retaliation by foreign country and the triggering of fierce trade wars.

“The result is more and more tariffs. Higher and higher trade barriers and less and less competition.

“So, soon, because of the prices made artificially high by tariffs, that subsidize inefficiencies and poor management, people stop buying.

“Then, the worst happens, markets shrink and collapse, businesses and industries shut down and millions of people lose their jobs.
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So progressives...like Reaganonomics now?

I can't figure out what either team is for at this point. I saw a great tweet earlier today that said that the rioters at the Battle of Seattle never would have thought that what they were calling for would come to fruition in the fashion that it has - lol
 
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#1,363
#1,363
MontyPython said:
Am I missing something here, Juicebox?

Per your article:

“While conceding that many U.S. high-wage manufacturing jobs were relocated to Mexico, China and other foreign locations as a result of NAFTA, Morris Cohen, Wharton professor of operations and information management, argues that NAFTA has, on balance, been a good thing for the U.S. economy and U.S. corporations. “The sucking sound that Ross Perot predicted did not occur; many jobs were created in Canada and Mexico, and [the resulting] economic activity created a somewhat seamless supply chain — a North American supply chain that allowed North American auto companies to be more profitable and more competitive.”
Click to expand...

You didn't continue reading after that did you?
 
#1,364
#1,364
volbound1700 said:
The issue with all of that is that there is a proven system of tariffs that worked. It was the USA Economy from 1790s until 1880s. Alexander Hamilton, one of the Founding Fathers, spearheaded a tariff system that helped develop the local US Economy.

I can agree that Trump has gone overboard with it but to say Tariffs have no grounds in history of working is incorrect. (Not sure if you are saying that but a lot are in this thread).

To me, our tariffs should only be directed at the low labor nations (mainly China). I also don't think it will work unless we can invite friends to join us and follow the same process. I don't think that we have unfair advantages against Canada, the EU, Australia, Japan, etc. There is no need to tariff those nations.
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Tariffs in those days were mostly a funding mechanism for the government since there was no income tax. The point of the current tariffs isn't really to raise money for the government - it's to achieve a desired ideological outcome. Which is a bad idea no matter who does it.
 
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#1,365
#1,365
05_never_again said:
Tariffs in those days were mostly a funding mechanism for the government since there was no income tax. The point of the current tariffs isn't really to raise money for the government - it's to achieve a desired ideological outcome. Which is a bad idea no matter who does it.
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It was primarily used to prevent low-cost British goods (yes I said that) from flooding US Market until they could develop their own industry. You can read about it here:

Tariff of 1790 - Wikipedia

en.wikipedia.org en.wikipedia.org

The Act Laying Duties on Imports was communicated by Alexander Hamilton to the United States House of Representatives on April 23, 1790. In order to promote manufacturing in the United States, Hamilton proposed that imported goods be more expensive, which would force Americans to buy more homemade products.
 
#1,368
#1,368
volbound1700 said:
It was primarily used to prevent low-cost British goods (yes I said that) from flooding US Market until they could develop their own industry. You can read about it here:

Tariff of 1790 - Wikipedia

en.wikipedia.org en.wikipedia.org

The Act Laying Duties on Imports was communicated by Alexander Hamilton to the United States House of Representatives on April 23, 1790. In order to promote manufacturing in the United States, Hamilton proposed that imported goods be more expensive, which would force Americans to buy more homemade products.
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I'm sure that's how it was sold to the public, since the public doesn't like taxes, but tariffs were one of the very few ways the federal government raised money in those days.

The text of the act itself leads with "An Act making further provisions for the payment of the debts of the United States." It was to raise money.
 
#1,369
#1,369
05_never_again said:
I'm sure that's how it was sold to the public, since the public doesn't like taxes, but tariffs were one of the very few ways the federal government raised money in those days.

The text of the act itself leads with "An Act making further provisions for the payment of the debts of the United States." It was to raise money.
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No, history records it as being for protectionism and it was pretty much held into place during the entirety of the Nineteenth Century. Now it was more targeted and not blanket like what Trump is doing.

If people want to argue how Trump is going about it and the scale, I can agree. However, don't get me wrong, I think that without tariffing China, we are selling away our future as our greedy executives would move all manufacturing to China and put all of us out of work. Once everyone is out of work, no one has the money to go out and eat or buy things (Service Industry is gone as well).
 
#1,374
#1,374
bamawriter said:
For anyone who thinks this is even remotely a good idea:

Please explain the reasoning behind the 10% tariff on Costa Rica. The two primary imports from Costa Rica are bananas and coffee. The US produces negligible amounts of both. This is not something that can be cured by "bringing production back to the US." Hawaii is the only state in which either can be grown on a commercial scale, and bringing products from Hawaii to the continent is usually more expensive that importing them from Central America. Please tell me how this tariff makes any sense whatsoever.
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It’s all so fkn retarded.
 
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#1,375
#1,375
05_never_again said:
Tariffs in those days were mostly a funding mechanism for the government since there was no income tax. The point of the current tariffs isn't really to raise money for the government - it's to achieve a desired ideological outcome. Which is a bad idea no matter who does it.
Click to expand...

Well, the truth is the admin has given us a bunch of different reasons for using the tariffs, and one of them is specifically for raising funds:

- to fight fentanyl
- to correct unfair trade
- to replace income tax (how do we arrive at free trade agreements when the plan is also to get so much tariff revenue that we replace income tax?)
- to return manufacturing jobs
 
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