Free Traders Case For Tariffs

RocksInMyHead said:

How many times must it be pointed out that these are NOT TARIFFS. They have nothing to do with tariffs. They are purely related to trade deficits - which is an incredibly simplistic and dumb way to assess trade relationships.

Words have meanings.

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But, if you are to tow the hyper partisan line, you MUST declare these as reciprocal tariffs and you MUST declare that these countries that Trump is slopping large tariffs onto are doing the dirty on USA and are fully deserving these new Tariffs and are probably deserving more. MAGA forever!

Vambram said:

Can you prove this?

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Yes. The formula has no input for tariffs. Just trade imbalance.

Vambram said:

Yes. I do. But do you understand that China's economy is the second most powerful in the world and the nation of China is the second most powerful and influential nation in the world?

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I understand Americans chose to consume a LOT of Chinese products. Let's see what happens when the 32% tariff (if actually implemented) hits the shelves of Walmart and the Dollar stores...

essentialsaltes said:

Yes. The formula has no input for tariffs. Just trade imbalance.

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And the values for elasticity and passthrough were set constant at 4 and 0.25, meaning that they cancel each other out.

Vambram said:

How big was the trade deficits with China during the Obama years?

International Trade

www.census.gov

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Explain how a trade deficit is a problem.
Everything balances out. China sells goods of value to you and you give money of equal value back to them.
It's not like the old days of Bater where you would pay for something by giving another product of value, e.g. I want to by some bacon, but I only have plastic trinkets, would you be willing to exchange?

Thankfully people invented money to overcome the awkwardness of these situations.

stevil said:

You are certainly taking the terms "global citizenship" and the term "globalisation" to extremes. Probably based on fear and paranoia.
No one is proposing to do away with countries. Being a global citizen merely means being respectful of people and countries, working/living together as brothers and sisters. Just being nice to each other really. It doesn't mean we should do away with countries and borders. That is a very extreme interpretation. Paranoia to the max!

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A great sequence I took from an economics text is a pyramid that follows these steps.
1, Free trade area
2. Customs union
3. Common Market - Common Currency and free labor mobility,
4. Economic and Political Integration.

The EU has gotten the furthest, but this is the pathway for every nation. Politically, the US could not offer free labor mobility so instead it purposely allowed illegal immigration. The pathway is still there but Trump sort of blew this up. Trump is more of a nationalist. So he has some properties in other nations. He still puts America first. It looks like his tariffs will set nationalism back so far that many if not most Americans will fixate on free trade. I would say Trump is a free trade advocate worldwide, but instead he is mercantilist and seeks to accumulate an advantage to America. Regardless, if this experiment in tariffs fails the pendulum will swing to greater integration. Environmentalists generally seek global solutions, there are some calling for international taxes, and the special drawing right (SDR) is just one pathway to a currency that assimilates other national currencies.

In the court system, the US Supreme Court in 2005 sided with international law in Roper vs Simmons. This ruling was to forbid the USA from executing a juvenile criminal.

The best evidence I can cite is a survey taken around the world that asked people about global governance. Here is a quote from the abstract. Source:https://academic.oup.com/isq/article/68/3/sqae105/7732859

"Specifications as democratic and/or focused on global issues like climate change significantly increase public support and lead overwhelming majorities worldwide to favor a global government. Support is even stronger in more populous, less free, less powerful, and/or less developed countries. The only exception is the United States, where no global government specification receives majoritarian public approval. Overall, our findings show significant international support for fundamental transformations of global governance, and thus indicate to activists and policymakers that relevant reform efforts can build on widespread public endorsement."

You can believe what you want but the world is nearer and nearer to a more global system. Sure there can be borders and nation states, but the push is on for a universal set of human rights, greater precedence of international law, and more centralized power.

If USA really wants to address Trade deficits with each and every country that they trade with, the USA should put their focus into producing goods that would appeal to people in those countries,, and should produce those goods at favourably competitive prices and of favourable quality.

If people aren't buying your stuff, make your stuff better. Don't destroy the functioning market place. Go back home, have a long hard think about why your stuff isn't selling, perhaps do some market research, adapt, come back to the market place with better stuff, more appealing stuff. People aren't buying your stuff because you are producing overpriced junk.

Richard T said:

The EU has gotten the furthest, but this is the pathway for every nation.

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The way I look at EU, is much like the USSR and USA.
A group of countries or states got together and created a favourable arrangement, where internally they do many things to create favourable and equitable free market trade. The Eu, USSR and USA had free markets internally, had a common currency. This benefited all members of the group, created a thriving economy and gave more leverage for doing deals with others outside this group.

Many USA states are big enough to be countries. Perhaps an anti globalist should want borders between each USA state, should want different laws, different currencies. Perhaps USA should split up and become 50 separate countries in order to fight against this evil notion of globalism.

The CEO of HarperCollins Christian Publishing, which describes itself as the U.S.’s largest commercial Bible and Christian book publisher, told The Wall Street Journal that it had been “all hands on deck,” after the president announced the tariffs on Wednesday.

Bibles are typically printed on thin paper stock and with presses that are largely located outside the U.S., according to The Journal.

Hammster said:

ICYMI: The Free Trader's Case for Trump's Reciprocal Tariffs

Today is Trump's much-heralded "Liberation Day". He may do more for free trade than all others before him.

open.substack.com

Donald Trump’s announcement of reciprocal tariffs, scheduled to take effect April 2, predictably flummoxed globalists and free traders alike. Yet in fact, both groups should be thrilled. The real question is why they didn’t think of it first.
(And yes, there’s an answer to that.)

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They did. They thought "Tarriffs are stupid. Let us not use them to try to intimidate people" and moved on to other strategies.

RocksInMyHead said:

Not that much higher. India's current tariffs on US goods average about 12% (vs 2% from the US pre-Trump), with actual values ranging from 38% on agricultural products to 2% on oil. I don't see how that justifies a blanket 27% tariff on them.

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Since Indians don't buy a lot of US-made products (relatively speaking), a reduction in their tariffs on US goods is unlikely to significantly impact the day-to-day costs there.

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???
The reciprocal tariffs are NOT based on the tariff rates of foreign countries. The extra tariff (above the 10%) is based on the trade deficit with that country.

mark46 said:

???
The reciprocal tariffs are NOT based on the tariff rates of foreign countries. The extra tariff (above the 10%) is based on the trade deficit with that country.

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I know - I've been harping on that fact for the past two days. I was replying to the claim about India's tariffs being "much higher than ours" with information on India's actual tariffs (which, for the most part, are somewhat higher than ours, but not to the levels claimed).

Vambram said:

Can you prove this?

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prove

Try ONE example. Go to google, bing or whoever and ask about the tariffs of Vietnam and see whether the average tax is really 92%. Trump gives them a bargain and only charges them 46%.

Another country may give you a hint, Israel offered to eliminate ALL tariffs on US goods, giving than a ZERO % tax rate. This certainly help Trump people to decide that Israel will pay 17% on its goods.

[Host] asked [Veep] Vance what he could tell Americans who “just can’t afford an extra three dollars here and there” and how the government will help those people. “Will cost go up at some point?” Jones asked. “Will this just be temporary? Are we talking three months or six months?”

“What I’d ask folks to appreciate here is that we are not going to fix things overnight,” Vance added. “Joe Biden left us—this is not an exaggeration, Lawrence—with the largest peacetime debt and deficit in the history of the United States of America, with sky-high interest rates. You don’t fix that stuff overnight.”

Vance did not explain how he thinks igniting a global trade war would “fix” those issues, saying only that the Trump administration believes “that if we pursue the right deregulation, we pursue those energy cost reducing policies, yes, people are going to see it in their pocketbook.”

RocksInMyHead said:

I know - I've been harping on that fact for the past two days. I was replying to the claim about India's tariffs being "much higher than ours" with information on India's actual tariffs (which, for the most part, are somewhat higher than ours, but not to the levels claimed).

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I think that India is a poor example. They put a tax of 100% on our autos, 50% on our apples, and 80% on our rice. The issue with countries like Idia is indeed the need for reciprocal tariffs, not ones based on their trade deficit and not based on their average tax rates.

There should be methods for dealing with the fact that we have no meaningful access to sell certain of our products in India, Sout Korea and Japan.
For example, if we shouldn't put the same auto tax on various countries. These should indeed be reciprocal.

Honestly, I think it's hiliarious that ChatGPT provided the EXACT same tarrif numbers as the Trump administration.

I feel like there is a "chicken and the egg" situation there maybe.

Vambram said:

Can you prove this?

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I showed it using a Tweet in post 137, where there are four countries that are in a South African Customs Union and all have identical tariffs (which are set by the Union). Yet, the US has applied different tariffs to each of those countries: Lesotho gets a 50% tariff, South Africa is getting 30%, Namibia 21%, Botswana 37% and Eswatini just 10%, the lowest rate possible among all countries."

If the US tariffs were actually based on what tariffs the foreign countries were charging, Lesotho, South Africa, Namibia, Botswana, and Eswatini would all have the same US tariff imposed on them; instead, one gets the highest tariff (50%) while another country with the same tariffs is only getting a 10% tariff (the lowest Trump is applying to other countries). As this example shows (as well as plenty of others) Trump is not basing things on the tariffs other countries are charging us.

Trump imposes tariffs on uninhabited Heard and McDonald Islands near Antarctica

Anti-penguin.

Finally the US is winning. The way Charlie Sheen was winning in 2011

Tariff breakdown from a non-Trump supporter
https://www.tiktok.com/video/7489058205834923310

Canuckster said:

Tariff breakdown from a non-Trump supporter
https://www.tiktok.com/video/7489058205834923310

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Yeah...it's pretty hard to find videos of idiot randos talking on the internet.


You've made a very salient argument.