Trump's Tariffs

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I have taken an interest in US President Trump’s tariffs, first on solar panels and large washing machines, and now on steel and aluminum.  A tariff is defined as a tax or duty on a particular class of imports or exports. The Wall Street Journal and the New York Times are in a dither, and I’m confused about Trump’s motives and methods, too.  The newspapers make the assumption that these are protective tariffs, in reaction to the large trade deficit with China. They fear retaliation by trade partners, and indeed, both Canada and Mexico have begun retaliating with tariffs of their own. Also, the European Union is preparing a list of reciprocal tariffs, supposedly aimed at industries in states that support Trump.  The Trump Administration justifies the duties by claiming the 25 percent import tax on steel and the 10 percent one on aluminum promote “national security.”

 

While this all may be true, I wonder if this is only a partial explanation.  Tariffs have a long history in the United States, starting with the Hamilton Tariff Act of 1789.  The purpose was to raise federal revenue and to favor northern industries, including iron and textiles, over British imports. President George Washington made tariffs a national security issue.  In his 1790 State of the Union address, he claimed protective tariffs, especially for military supplies, was crucial for US independence.

 

For most of its history, the United States relied on tariffs and excise taxes for the bulk of federal revenues.  The 1789 tariff was the second piece of legislation passed by the fledgling US Congress.  Two years later, excise taxes on whiskey, run, snuff, and refined sugar were initiated.  The purpose of both types of taxes, according to the first Treasury Secretary, Alexander Hamilton, was to pay Revolutionary war debt, allow the government to function, redeem at full value federal debts, and the pay the debts of states.  Since then, well over thirty acts affecting tariffs have been passed. Then, the US became a participant in the World Trade Organization when it was formed in 1994.  President George W. Bush attempted a tariff on steel in 2002, but it was declared illegal by the WTO a year later.

 

When the income tax was instituted in 1913, under Woodrow Wilson’s administration, tariffs were reduced at the same time, but they were raised again in 1922 to help pay World War I debts.  In 1930 the Smoot-Hawley Tariff raised tariffs on over 20,000 imported goods and is sometimes blamed for exacerbating, if not causing, the Great Depression.  Far from our supposed “free trade” stance, the US now collects duties on over 12,000 items.

 

However, as of 2017, tariffs comprised only a small portion of federal revenues.  Individual income taxes (41%), payroll taxes (40%), and corporate income taxes (9%) made up the bulk of federal income, with excise taxes adding another three percent, according to government data.  But, with the combined effects of federal, individual, and corporate income tax cuts in 2017, as well as the increase in federal spending, I have to wonder it the Trump tariffs of 2018 are partly designed to raise needed federal revenues.

 

The president claims he wants to stimulate the domestic economy, but manufacturers whose supply chains depend on imported steel and aluminum products say, if the New York Times is to be believed, that increased prices will force them to cut back on employment, expansion, and production.  Uncertainty abounds, for good reason.  The initial proclamation included Canada, Mexico, and the European Union, but then a month’s moratorium was granted.  The moratorium ended on May 31.  Australia, Argentina, Brazil, and South Korea have been granted exemptions.  Canada has declared reciprocal tariffs to begin on July 1, and Mexico has instituted tariffs, too.  The EU is drawing up its own list.  The backlog of specific exemption requests is expected to take months to process.

 

Since so many others are speculating about how this will play out, I figure I can speculate, too, but I take a different tack from the hand-wringers in New York.  I hope it will reduce consumerism.  All taxes are ultimately paid by the individual, and tariffs are taxes on consumption rather than income. The only beneficiaries of tariffs are governments and protectionist industrialists like US Commerce Secretary Wilbur Ross.

 

Now, this is an interesting little side story in the Trump tariff saga.  Secretary Ross made a hefty little profit on the Bush tariff of 2002, if the Wall Street Journal of March 10-11, 2018 is to be believed.  He took full advantage of that tariff to scarf up struggling steel enterprises, including Bethlehem Steel, restructure them to unload debt and pension obligations, and sell in 2004 to London-based Mittal, where he became a board member until joining Trump’s team and selling his Mittal shares.  Now, the new tariffs apparently include EU imports and companies like Mittal?  Hmmmmm.

 

This evolving tariff drama also leads me to speculate about whether it will stimulate metals recycling operations in the US and elsewhere.  If the price goes up for steel and aluminum-based products, will it reduce demand, strengthen the dollar, or lead to higher quality?

 

Is the president throwing angered trading partners China’s way, in direct opposition to his stated intentions?  Where will the EU go for its steel and aluminum if US prices suddenly exceed those of subsidized producers like those in China?  The US has less than half the iron ore reserves of Russia and China, says the WSJ, because we have been going through ours so fast. 

 

I commiserate with those directly affected by the president’s erratic course, and suspect it will hurt “the economy” in the short term, if only to make China more competitive than ever.  In the longer term, I believe it may be good for the US to slow down, withdraw somewhat from the world stage, and to allow others the space to grow and prosper.

 

 

 

 

 

 

 

 

Comments

Tubularsock Added Jun 10, 2018 - 11:29am
Well done Katharine. Even attempting to explain a Trump motive is a gargantuan task indeed!
 
He seems to be prone to “mood swings” so the entire mess may not be over yet.
 
The ONLY thing one can count on is that the “little guy” will be the looser and Trump And His Swamp will walkaway with the bacon!
Ryan Messano Added Jun 10, 2018 - 11:33am
I agree with Trumps tarriffs, though I am a fan of free trade.  It’s no free trade when China’s slave labor is undercutting U.S. prices.  Until China gets rid of communism, which it shows no signs of doing, she must be treated warily and cautiously.
 
Also, Americans need to wean themselves of this consumerism that is destroying our self respect and our prosperity simultaneously.
 
Behind all of these economic  problems, are the moral problems.  The breakdown of the family that began when America was sabotaged by the Kinsey Report in 1948, has wiped out 200 million American babies via contraception and abortion since a rogue SCOTUS legalized contraception illicitly in 1965. Making sex outside of marriage common, along with avoiding children has created a nation of selfish people, rich and poor.  Selfish people don’t do as well economically as selfless people do.
 
People are trying to find the pleasure they once found in family, children and church elsewhere, and are finding out that promiscuous sex, gambling, drugs, cars, houses, vacations, money, and prestige don’t ultimately satisfy.  Some never figure it out.
Katharine Otto Added Jun 10, 2018 - 11:40am
Tubularsock,
He does seem to be flailing, striking out at everything and everyone at once, and mostly hitting himself.  Stay out of his way, if you can.  A trade war is better, in my opinion, than a nuclear war.  The "little guy" may suffer the least.
Ryan Messano Added Jun 10, 2018 - 11:47am
Tubularsock, you seem to have a bad case of TDRS (Trump Derangement Reluctance Syndrome).  You have poisoning and hardening of the attitudes caused by ingestion of too much fake news.  
 
There is a cure though. Read seven conservative news sites for the first two months of your entire life, or you can read Messanonews.com for a month, and you should be healed, and no longer will be a pawn and a thrall of the puppetmasters.
Bill H. Added Jun 10, 2018 - 12:17pm
Katharine - I suspect Trump's tariffs are essentially gifts to his contributors. Obviously, solar technology represents a threat to oil industry profits who have been fighting tooth and nail to slow the implementation of alternative energy sources for years.
Steel tariffs can relate directly to rewarding VP Pence's home state of Indiana, the largest producer of steel left in the US. As far as aluminum, the US only ranks as #9 in aluminum production.
If Trump somehow thinks that any of the above industries will shell-out the capital required to allow a considerable increase in production of any of these commodities, I believe he is mistaken. It would take a totally different mindset for many US companies to return from staff reductions, importing and outsourcing  back to reinvesting in new infrastructure and hiring more US workers. To do so would deflect from their present priorities of buying back company stocks and inflating the salaries of CEO's.
 
Messano - Don't you have anything better to do than insult and demean people?
 
Tubularsock Added Jun 10, 2018 - 12:32pm
Ryan Messano, Tubularsock thanks you for your advice and is rather pleased that you, in your caring way, is so concerned about Tubularsock’s well being.
 
Tubularsock is not in disagreement with all conservative views but only with the totally inane conservative views that pollute the body politic.
 
Even you Ryan, would have to admit that Orange-Tweet isn’t the brightest turd in the toilet. But hey, he does have his fun side and keeps Tubularsock laughing.
 
Tubularsock is going to take a look at Messanonews.com and read your work to see how far you have fallen down the rabbit hole.
 
You may EVEN find it interesting to jump to the wild side and read www.tubularsock.com for a little base line truth.
 
And remember Ryan, you’ll have to bring your own blue pill because Tubularsock is only handing out RED pills in offering truth. It is Tubularsock’s “free-trade” position.
 
Cheers.
Ryan Messano Added Jun 10, 2018 - 12:40pm
Bill, you’re wrong, as usual. Subsidizing green energy is a domain that totally isn’t the governments job, and green energy has been shown to be extraordinarily mediocre in many instances. I.e. wind energy.  It was a big Tom Steyer hoax, where you delude simpleton American taxpayers into thinking fossil fuels are bad, green e edgy good, and then you sucker the taxpayers out of their money.  You fell for it.   
Tubularsock Added Jun 10, 2018 - 1:02pm
Ryan, don't look now but who is it that is currently subsidizing the fossil fuel industry and has for years?
 
Oh come on Ryan, Mr. Free Trader, one wild guess.
George N Romey Added Jun 10, 2018 - 1:17pm
I think we miss the big picture. Companies are building new factories that will employ fewer workers whether here, China or anywhere else. We are running out of the ability to keep Americans employed in decent jobs, including professional support jobs. It’s what we are also missing with the minimum wage and college degree arguments.
 
We need a total reset on the idea of “work.” Trump is nothing more than a distraction from real problems.
 
Its like focusing on the fact that your grass needs cutting while your house is burning down.
Tubularsock Added Jun 10, 2018 - 1:28pm
George, an EXCELLENT point. We, as a world, needs to focus on a totally new reset even as the house is burning!
 
As for the grass, Tubularsock just smokes it ......... whatever, bro.
Ryan Messano Added Jun 10, 2018 - 1:47pm
At the bottom of the problem, George, is not the government, or the economy.  It's not jobs.  It's people.  Corrupt habits breed societal dysfunction.  Many who had hedonistic young years simply cannot grasp that it is their epicurean attitudes that are the problem.  Hard work and virtue is always rewarded with material and spiritual prosperity long term. 
 
The problems we face today are no different from what Ben Franklin discussed in 1758.  The solutions are the same too. 
 
Americans are lazy, apathetic, uninformed, and corrupt.  That is the problem.  But you can't get elected saying that, because people like you get bitter and resentful at getting told the truth and try to crucify the truth teller. 
 
This is why Trump was elected.  While he was a million times better than any Democrat, he is far from ideal.  The voters who have little moral compass and think money matters more than morals are the ones who propelled him to victory over Cruz, who was a far better short term and long term candidate.  America will suffer for her stupidity in selecting Trump over Cruz. 
Ryan Messano Added Jun 10, 2018 - 1:58pm
Very prolific, Tubularsock.  While I strongly disagree with many of your assessments, I'm pretty sure I can put my finger on the root of why your judgement is off.  However, if I do so,  you will likely be severely offended.  I already have Michka on the warpath, and he explodes on a daily basis.  While it doesn't bother me at all, and I expect it, it's best to tell the truth to those who want to hear it.  Those who don't, will hate you for telling them the truth. 
 
Well, Tubularsocks, guess where our military would be if we let our fossil fuel dominance slip?  Did you guess inferior?  As Wilbur said to Orville, you are Wright!!!
 
Despite the lefts hatred of the military and fossil fuels, the absence of both would make us the red headed step child of the world's tyrants. It's too bad the weak kneed cowards on the left don't grasp this.  I once was one, and was a Conscientious Objector from the Navy.  But, I'm older and wiser now.  Reagan was right, "It's a time for choosing".   Reagan was also right about the Democrat PlatformOnly the virtuous understand strength and power, the libertines can't. 
George N Romey Added Jun 10, 2018 - 3:26pm
No Ryan it’s not people. It’s the garbage you believe handed to you by the .01%. What’s even more sad you worship these people that would look down you on every way possible. I’ve been around them. They treat the religious right as morons easily fooled. As evidenced by their public behavior (think Harvey Weinstein) many of them are immoral and repugnant as possible.
 
For a man supposedly of God your ignorance is shocking. Who exactly did Jesus throw out of the temple?
 
Instead of obsessing about porn instead go ask people involved in faith based charities what they are witnessing. Unlike you I have. Even in the most affluent communities they are being pressed by those in need that once were contributors to society.
 
I may not be religious but I try to live my life as Jesus so described, not always living up to his teachings. You on the other hand want to play Jesus. Big difference.
Ryan Messano Added Jun 10, 2018 - 4:14pm
It’s people, George.  Good and evil are common to the rich and poor alike.  While being rich and powerful involves a special set of temptations that today’s rich are not equipped to deal with, having been taught “survival of the fittest” in school,  the poor have issues too.  One of the biggest sins of the rich is the neglect of the poor, but, helping the poor doesn’t mean giving the money, food, cloths and housing always.  Carnegie gave away 2,500 libraries, and any poor person can learn anything they want to to get anywhere they want in life.  While taxes and regulations stifle mobility between classes, that’s a Democrat innovation mostly.
 
My beliefs are given me by the immutable laws of history, that never change.   I look for news based on its being aligned with history.  If it’s not, it may well be popular now, but it will never prosper long term. 
 
Im well aware of the snobbishness of the rich and elite.  I live in a town full of them.  But, most of them
used hard work and diligence to gain their wealth and envy and jealousy of their success isn’t helping the rich or the poor. To begrudge a man his wealth because he misuses it isn’t right either.  Wealthy liberals like Weinstein and the rest of the elite Democrats are the scum of the earth.  Maxine Waters, Kamala Harris, Hillary, Obama, the Congressional Black Caucus, Tom Steyer, Bill Gates, Jeff Bezos, Nancy Pelosi, Chuck Schumer, The liberal tech titans, and many others fall in this category and they are worse than Vidkun Quisling and Benedict Arnold.  
 
Christ threw those using the church for a piggybank out of the temple.  Most churches have money hungry preachers who could care less about preaching the unpopular truths of the gospel because the collection on Sunday would be affected. They teach a watered down, sugar coated gospel that isn’t getting anyone to heaven.  
 
Eliminate the corrupting habits of porn, drugs, and helllvision, while encouraging broad and deep reading of meaningful history, and our crime and poverty problems would take care of themselves.
 
Jesus said, “Man does not live by bread alone, but by every word that proceeds from the mouth of God”.  That means man needs truth, not food to live. 
 
 
 
 
Bill H. Added Jun 10, 2018 - 4:39pm
 
Ryan - You know damn well that I am spot on, but would never admit that I (or anyone else you assume is a "liberal") is correct on this point.
George pretty much summed it up stating "What’s even more sad you worship these people that would look down you on every way possible".
If you look back, This has been the case with both parties over about the last 20 years. Rather than simply ingest what you are fed by your heroes, look at reality.
 
Ryan Messano Added Jun 10, 2018 - 4:43pm
Bill, exactly where did I sing the praises of any contemporary person because they had money?  
 
Both you and George are off on that accusation.  While labor is virtuous and often leads to wealth, I’m well aware of the selfish nature of the rich and poor.  Poor people often waste their time, Rich people their wealth, and both are bad.
 
 
Even A Broken Clock Added Jun 10, 2018 - 8:44pm
Katharine - in terms of depth of thought going into the tariffs, there was none - nada. Except for the knowledge that the base would take these tariffs as evidence that the man was doing something good for the working man. Most folks do not have the intellectual curiosity to seek out a subject in depth, and therefore are seriously undereducated when it comes to economics.  Good post. Thanks.
Jeffry Gilbert Added Jun 10, 2018 - 8:44pm
Katherine you didn't address the tariffs on DUHmerican goods such as Canada's 270% tariff on DUHmerican dairy. Just one example of the bad deals previous administrations have allowed. The Chinese have backed away from their threats on high tariffs on DUHmerican goods as well.
Dave Volek Added Jun 10, 2018 - 9:27pm
Katherine
You have taken a few interesting angles with this Trump decision. This shows you are a thinker that can think past the first set of ramifications. 
 
Yes, it is not the end of the world. We will adjust somehow, although some working people are bound to be hurt. 
 
Mr. Trump just insulted the Canadian prime minister today. Even Mr. Trudeau's political opponents won't stoop that low. Maybe that is another straw for impeachment proceedings after November. 
Mustafa Kemal Added Jun 10, 2018 - 9:36pm
Katharine, thanks for sharing. It is too bad some feel the need to sidetrack the thread off topic, so that upon reading through the thread one asks "what were we talking about?"
 
I have only one question, When you state
"and tariffs are taxes on consumption rather than income."
my first thought was that is a really good thing, of course, if the taxes on income are reduced as much,
but then that conflicts with your assertion
"The only beneficiaries of tariffs are governments and protectionist industrialists like US Commerce Secretary Wilbur Ross."
unless, of course, you are speaking of if the income tax is not reduced and tariffs simply added, in that case I agree.
 
 
When I watch these debates, what I see is that few realize that whatever realignments will occur, that those of us at the bottom are going to get screwed. If the  trade deficit is adjusted so that the adjustment goes into the pockets of the corporations, then Trumps supporters get to feel good that the deficit is reduced while their (and the rest) pockets get picked.
 
Part of me feels that the aluminum and steel tariffs is not about economics at all.  It is war preparations. We cant buy China steel if we are at war with them. (well I suppose Rockafellar could have) 
 
Mustafa
Ryan Messano Added Jun 10, 2018 - 9:40pm
Canada has a 270% tariff on American dairy products and traitorous Dave here has an issue with Trumps manners.  Haha.  Didn’t know you were in comedy Dave.
Ryan Messano Added Jun 10, 2018 - 9:45pm
Kind of like how you always get off topic with fake news about America’s past, and barely know the real news, Mustafa.  
 
And no, Mustafa, your own bad habits and being uninformed “screw” you way worse than taxes or tariffs ever could.  
 
Yes, it is war preparations.  China is gearing up for it, and we are doing her just as we did Japan in 1941.  She doesn’t seem to be learning. These godless secular cultures rarely do.
Jeffry Gilbert Added Jun 10, 2018 - 9:56pm
Dave here has an issue with Trumps manners
 
And is totally ignoring the bad manners of soy boy's stabbing Trump in the back and waiting until Trump was airborne to do it.
 
I'm no Trump fan by a long shot but soy boy Trudeau has risen to his level of incompetence.
 
MEFOBILLS Added Jun 10, 2018 - 9:57pm
First of all, sometimes Tariffs are good and sometimes bad.
 
The U.S. got rich behind Tariff Walls.  The American System of Peshine Smith and Henry Clay was similar to List's Industrial Capitalism used by the Kaiser in Germany.
 
In other words, it is a highly successful economic model, which can be summarized "Low Internal Tariffs and High External Tariffs."  
 
In the Industrial Capitalism model, bank credit channels toward Industry.  Note:  China uses the Industrial Capitalism model of Smith and List.  So, any crying by China about Tariffs are crocodile tears.  China vectors credit from its state banks into targeted industry.  Yes, it is so.  
 
Usually industry gas-lights government politicians.  There is general hypnosis that tariffs are bad if the industry wants to invade foreign lands and take. There is more hypnosis if a domestic industry is monopolized and trying to take rents through prices.
 
In other words, if a monopoly situation arises then TARIFFS bad. The idea is to import lower priced goods to offset the internal monopoly.
 
If a built out domestic industry is using its power to be adventurous overseas, then any claims about a foreign power using tariffs to protect itself are bogus.  It is legitimate and right for a country to protect its national interests from predators.
 
With regards to steel, and steel tariffs - China has built up too much capacity with its state run industry.  
 
Also, with the advent of electric-arc furnaces, RECYCLED steel is more cost advantageous than using Ore.  
 
Usually, one sees trains full of shredded metal heading West to the Pacific Ports, while finished goods like cars are heading from West to East.
 
This mercantilism and Industrial Capitalism of China is doing great economic damage to the U.S., so tariffs are more than warranted.
 
The better way to do it would be a Bancor System, but that is probably over the heads of most politicians.  
 
Bill H. Added Jun 10, 2018 - 10:58pm
But to impose strict tariffs on what's left of our allies will most likely prove to be a big mistake. I don't care who does it.
Tubularsock Added Jun 10, 2018 - 11:13pm
Ryan, you don’t have to worry about severely offending Tubularsock due to the fact that Tubularsock ALWAYS considers the source from which the information comes. But thanks for your concern.
 
You may want to review your younger “Conscientious Objector” self because Tubularsock would say your were more awake to reality as a youth. And now as an “older” individual you are tossing out quotes from Alzheimer-riddled-Reagan in the belief that that imbecile had anything of value to say. He just carried “Death Valley Days” into the White House.
 
As for the military, if WE weren’t creating continuous wars we wouldn’t need much of a military. And fossil fuel dominance would be a thing of the past. But hey, that’s where the money is made and as long as the poor and stupid join as cannon fodder the American terrorist activities will continue.
 
But don’t you worry, Ryan. It’s ok with Tubularsock because Tubularsock’s major investment portfolio is well positioned in Body-Bags.
 
Cheers.
Ryan Messano Added Jun 10, 2018 - 11:29pm
Speaking of oneself in the third person is nearly always a mark of humility.
 
Would Tubularsock Be so kind as to reveal what five biographies of his nations Founders he has read, outside of school?   Would he also be kind enough to list seven conservative news sites hehas read for only two months of his life?
 
If he has not, then may I suggest Tubularsock should put a figurative sock in it and take his happy behind to the library, park it in a seat, and commence reading? 
Flying Junior Added Jun 11, 2018 - 2:36am
The tariff on solar panels came as no surprise.  A predictable attack on California, the West and renewable energy.  Of course it hurts Arizona, Nevada, Colorado and Texas just as much
 
The tariffs on steel and aluminum were far more incomprehensible.  Why mount a devastating attack on the U.S. manufacturing sector?  As many as 3,000 U.S. manufacturers of steel and aluminum products, including makers of finely machined tools have petitioned Donald Corleone hat in hand for that prayed-for exemption to the destructive tariffs.  Even the handful of companies that thought they might benefit from this misguided policy have already seen their steel prices climb.  Everybody loses.  It’s not clear just how the monster himself can make any money from these policies?
 
I consider it a mania bordering on dementia.  Maybe something in his tiny intellect zapped forty years ago when Japanese automobiles became competitive.  Remember, Trump was not even aware of Toyota and Nissan manufacturing plants in Kentucky and Tennessee.  Every day it’s the mantra.  Unfair trade practices.
 
How many nations might wish to be the big dog with healthy trade deficits with every other major manufacturing nation in the world.  They’re all working for us.  Explain to me how that is bad.
 
Even more perplexing is the rush to sell off our precious natural gas and oil resources.  Scorched Earth.
Dr. Rupert Green Added Jun 11, 2018 - 4:43am
Thanks for a good and enlightening read, Otto.
Bill Kamps Added Jun 11, 2018 - 7:47am
Tariffs are a complicated matter, there are thousands of them in place with every country  we trade with.  This includes the members of NAFTA despite the political speak of its name. 
 
It is difficult to look at tariffs individually because most have been negotiated as a package with the countries we deal with.  In the perfect world there would be no tariffs, but for that to work, all the countries would have to agree on the same EPA, OSHA, minimum wage, inspection rules, and other laws so the playing field would be more or less level.  It is very much  not level at the moment. 
 
Everyone preaches free trade, but in fact is no one practices it.
 
Trump has put tariffs in the news, but in fact he really hasnt changed them very  much given that we have thousands of them in place.  Even with the steel and aluminum ones  mentioned, they only affect a tiny percentage of the goods we import. 
Bill Kamps Added Jun 11, 2018 - 7:52am
George: We need a total reset on the idea of “work.”
 
George you continue to show that you dont understand why jobs exist.  Jobs exist because the employer believes if they hire someone, that someone will make money for the employer.  They dont always get it right, but that is the motivation for creating jobs.
 
Employers dont create jobs to improve the standard of living of the employees.  Governments dont create private sector jobs. 
 
It is impossible to create jobs without benefiting the owners of the companies. 
 
By the way it is very likely that you are a member of the top one percent in the world, since that is a pretty low threshold. 
George N Romey Added Jun 11, 2018 - 8:22am
Bill at the beginning of the 20th century the standard workday was about 12 hours. In the 1930s it was reduced to 8 eights part by legislation part by the automated factory line. Are you telling me we still operate with the same technology from 85 years ago and therefore can’t reduce the standard workday from 8 hours?
Bill Kamps Added Jun 11, 2018 - 9:21am
George, you can legislate a shorter work week, but this just shows how you think.  Besides the French tried this I think. 
 
If you cut the work week to 30 hours, then I have to hire two more people.  That did not increase my sales, so therefore the amount I pay for salaries has to stay the same.  I must cut the salaries for the people who now work 30 hours instead of 40 by 25%.  What was accomplished? 
 
In fact, because of the benefits I have to pay the new employees, I am actually worse off, and have to cut salaries more that 25% to break even. 
 
If you say I cant cut salaries, then I have to shut down the company, and everyone loses their job, because my margins are not big enough to support more workers.   Now you can say the new rules only apply to big companies, and they cant cut  salaries. but this will just accelerate automation or outsourcing. 
 
If you make workers cost more, companies will find a way for there to be fewer of them.  Once again, companies only hire workers, if it makes money for the company.  Change the math for what  a worker makes, and you change the calculation of when to hire, and where to hire.
 
In your plan more people become employed, but the ones who were employed before now make less money.  I dont see how that is progress.  
 
 
 
 
 
Dino Manalis Added Jun 11, 2018 - 9:48am
 Tariffs make matters worse and products become more expensive for consumers.  I hope it's a negotiating tactic to force countries to import more American goods.  China has already promised to do so, but quickly added only if the U.S. didn't impose tariffs.  It's a slow gradual process and Trump may not be willing to wait.
Thomas Sutrina Added Jun 11, 2018 - 10:27am
First of all in Washington's time INCOME TAX DIDN'T EXIST.  In fact the founders disproved of income tax.  Tariffs was the primary source of income for the Federal government.  And the federal government was the smaller then state governments.   Tariffs was an one of the means governments used to obtain money to operate.  America was a nation that survived on trade so other methods of taxing would effect exports more.
 
No one mentioned that our exports face tariffs to enter the markets of Canada, Mexico, and the EU that provide money to those nations far greater then the tariffs we impose on Canada, Mexico, and the EU even after Trump's tariffs are applied.   This is why Trump has always said that the trade agreements are UNFAIR.   
 
I believe that Trump is getting rid of the agreement that international corporations have used as a club against nations.  When a law in a nation changes the situation of a foreign produced product imported the producer can claim injury and receive compensation.   This I believe is in all those trade deals.  Who is harmed?  The citizens are harmed while the corporations get rich.
 
So if a nation used DDT to kill bugs and learned the harmful effects of DDT and chose to tighten or limit the use then the company sales are harmed by the law change.  The cost often is so high that the law never goes into effect.   
 
Back to tariffs.   So how do you get someone to even listen?   I can not think of anyone that will even hear arguments to end a lopsided agreement by the person that gains from it.  That is the position of Canada, Mexico, and the EU.   You get them to listen only by making the lopsided agreement far less lopsided to even.  
 
So as Teddy Roosevelt would say  "speak softly and carry a big stick." Roosevelt described his style of foreign policy as "the exercise of intelligent forethought and of decisive action sufficiently far in advance of any likely crisis." Wikipedia (wanted to get the saying accurate)  The tariffs are the big stick in response to the unwillingness of those to listen.   
 
Tariffs  is a tax paid by the purchaser but it is loss of jobs by the producing nation.   Who's economies have higher unemployment and pay for welfare to those unemployed, American or Canada, Mexico, and the EU.   
 
If the Europeans drop their tariffs to America that exist before Trump then who gains.  The economy of Canada, Mexico, and EU will start producing more goods and need employees.  Unemployment will decrease and income from the workers and producers will increase.  
 
The problem is that socialist do not want to loosen their grip on the economy.  They want us to believe that the economy is better when they control it.   This is a myth that has been put forward for a century with no and I repeat absolutely not evidence to back it up. 
 
Some will point to the Great Depression but that was not a capitalist failure.   It was a government and crony capitalist failure.  Crony capitalist got the government to place tariffs to limit the recovery of Europe after WWI.  Why because America feed Europe and now they could feed themselves.   Crony capitalist created the Federal Reserve with a promise to be the bank that would end runs of banks.   They let three waves of runs of banks that only supported farmers that could export enough to pay for the new equipment.  The Government prevented bank diversity so that alternative was closed and the Reserve failed to prevent the runs.
 
There is spotty comparisons of FDR's recovery to others because less data was collected and similar data has to be compared.  But it is a general understanding that compared to Europe America's recovery was much slower.  
 
Here are some articles that show the myth that Socialism economics works better then others.
http://dailysignal.com/2015/05/03/how-obamas-recovery-compares-to-reagans-recovery/
President Obama Is The Second FDR, Not The Second Carter http://www.forbes.com/sites/markhendrickson/2012/11/08/president-obama-is-the-second-fdr-not-the-sdecond-carter 
 
 
Originally published on Fox News: How Obama’s Recovery Compares to Reagan’s Recovery  Stephen Moore / Joel Griffith / May 03, 2015
 
 
http://www.differencebetween.net/business
Thomas Sutrina Added Jun 11, 2018 - 10:30am
 
Here are some articles that show the myth that Socialism economics works better then others.
http://dailysignal.com/2015/05/03/how-obamas-recovery-compares-to-reagans-recovery/
President Obama Is The Second FDR, Not The Second Carter http://www.forbes.com/sites/markhendrickson/2012/11/08/president-obama-is-the-second-fdr-not-the-sdecond-carter 
 
 
Originally published on Fox News: How Obama’s Recovery Compares to Reagan’s Recovery  Stephen Moore / Joel Griffith / May 03, 2015
 
 
http://www.differencebetween.net/business/difference-between-fdr-and-obama/
 
 
How new a deal? | The Economist http://www.economist.com/node/12637053/print
 
Carpe Noctem: New Deal vs. Reaganomics vs. Obamanomics http://toseizethenight.blogspot.com/2011/06/new-deal-vs-reaganomics-vs-obamanomics
 
 
http://angrybearblog.com/2008/11/unemployment-rate-under-reagan-vs-fdr.html
 
 
Reaganomics Vs. Obamanomics: Facts And Figures
http://onforb.es/qH5Dq7
Mike Haluska Added Jun 11, 2018 - 2:33pm
Go back to basics and use your common sense.  Whether it's the North American Free Trade Agreement, The Pacific Free Trade Agreement, etc. the one thing that ALL "Free Trade Agreements" have in common is that they have NOTHING TO DO WITH "FREE TRADE"!  
 
Here's where your common sense should step in:  NAFTA (like all trade agreements) is thousands of pages long.  If it were truly a "free trade" agreement (elimination of tariffs/barriers/subsidies) then WHY WOULD THE AGREEMENT NEED TO BE THOUSANDS OF PAGES?????
 
I mean, how many pages does it take to list NO tariffs, subsidies, barriers???  
Dave Volek Added Jun 11, 2018 - 3:17pm
Mike
 
I like your ideal world. Unfortunately, it is not realistic.
 
I followed the original FTA and Nafta when they were created (back in my days of being a political junkie). Because there were tariffs, subsidies, barriers, etc. already in place between Canada and the USA, all these had to be negotiated away. Here are a few issues that I recall:
 
1) Canada could not cut back its oil exports to the USA in a time of an energy crisis.
2) The supply economics of the Canadian dairy and poultry industries were left in place.
3) The Americans put Canada's public health care system on the negotiation block, but later took it down.
4) The Americans were allowed to subsidize their farmers in any way they saw fit. Actually both sides were, but Canadian farmers haven't received much subsidies for a long time.
 
I had a friend who was in the tool repair business. Before the FTA, he had a difficult time getting parts from US-based manufactures. After FTA, it was much easier. And he was able to pass some cost savings to this customers, who then could justify repairing other tools rather than junking them.
 
So I'm for all your ideal world. I'm afraid we need to break one stick at a time. It seems the current president is going to unravel 30 years of trade negotiations in a very short time.
 
 
Katharine Otto Added Jun 11, 2018 - 4:37pm
I knew I could count on the WriterBeat community to expand and deepen my thinking on Trump's tariffs.  Thank you all for your comments.  You have added many interesting and informative perspectives.
 
Ryan,
We agree that consumerism has gone too far.  I happen to like green technology but not government subsidies or mandates.  There is no industry more heavily subsidized than the automobile industry, especially if you count all the highways the various levels of government have built to "serve" the public.  If the railroad infrastructure was also owned by the public, passenger rail would would be more competitive with freight, and the private auto wouldn't have become necessary for the masses.
 
You mentioned Andrew Carnegie.  I am reading a biography of him now, by David Nasaw.  Steel magnate Carnegie took advantage of an 1870 $28/ton tariff on steel to make many of his millions.  The tariff was in effect for 30 years, or most of Carnegie's career.  Also, Carnegie was not religious.  While he claimed to be a socialist, he also allowed his overseer to push workers to the utmost, lowering wages several times when the price of steel went down, and re-instituting the 12-hour workday.  When prices went back up, wages were increased only slightly, but workers had to strike to return to the 8-hour day.  
===========================================
Tubularsock,
Thanks, as always, for your superb wit and insight.  I didn't have the space to cite all the ways the fossil fuel industry is subsidized.  I will reiterate, however, that the Department of Offense is the biggest consumer of fossil fuels, and it probably doesn't pay all the excise and sales taxes the rest of us do.
 
The import-export shipping industry is also a big oil drinker, I suspect.  
 
===========================================
Bill H.,
I didn't know about Pence or Indiana.  Something else I read suggested the domestic steel industry doesn't even need the tariffs, because they are at capacity, what with the destruction by hurricanes and floods in Miami and Houston.  In fact, spokespeople for both steel and aluminum have urged against the tariffs.  That's partly why I wonder if they are meant more to raise revenues than fight trade wars.  What concerns me more is the jerk-around approach that must be exasperating for those who can't depend on any price stability as long as the Trump administration is jerking them around.
===========================================
George,
Agreed that we need new approaches to work, as well as leisure.  If people reduce consumerism, for instance, they may choose to work less and enjoy life more, for free.  That's why I mentioned recycling metals.  As Mefobills says, the US exports a lot of scrap metal.  The tariffs could stimulate more efforts to recycle here and generate jobs that way.  Just one example.
===========================================
Clock,
Thanks for the compliment.  I love researching topics that interest me, as you also seem to do.  It's shocking that the major media outlets take such superficial views, all of them.  I blame it on young, inexperienced, reporters who are trying to meet deadlines.  The copycat reporting reinforces the standard lines and tunnel-vision approaches.  There are people who would like to know more--as the responses here show--but they often don't know where to look.  I don't profess to have answers, but I have lots of questions, and the time to explore.
===========================================
Jeffry,
I thought about mentioning some of the tariffs the US places on other imported goods, but didn't want to make the article too long.  As for other countries' tariffs on US goods, you are right that they are extensive.  I didn't know about the 270% on US dairy.  thanks for mentioning it.  Bottom line is there is no such thing as "free trade," even if you have so-called "free trade agreements," like NAFTA.
===========================================
Dave,
I heard about Trump's behavior at G-7 on NPR today but didn't get the whole story.  It does sound as though he's getting more and more irrational.  I guess Trudeau has decided to impose reciprocal tariffs on July 1.  I commend him and hope other trading partners do so, too.  Maybe the little guy will be hurt in the short term, but maybe the extent of government overreach by all parties will become more apparent.  Nobody agrees with me (yet), but I continue to maintain that governments exist to fund themselves.  Tariffs are some of the oldest mechanisms used.
===========================================
Mustafa,
I'm sorry if I confus
Dave Volek Added Jun 11, 2018 - 5:07pm
Katherine
Mr. Trudeau did not say anything different at the G7 than he has been saying for the past month. Canada is not going to roll over to Trump's demands. The response should have not been a surprise.
 
One Canadian analyst said it was the North Korea summit was the motivater. By not publicly capitulating, Mr. Trudeau makes Mr. Trump look weak.
 
John Minehan Added Jun 11, 2018 - 6:21pm
There is no economic rationale to this.  This is an international pecker contest.
Tubularsock Added Jun 11, 2018 - 6:35pm
Ryan Messano, “Speaking of oneself in the third person is nearly always a mark of humility”.
 
Thanks Ryan. Tubularsock could not have said it better himself and the fact that you have recognized Tubularsock’s humility is a surprise and rather charming.
 
And now you want Tubularsock to provide a reading list for you?
 
Well, your first request, five biographies of this nations Founders, shows a lack of understanding of historical truth.
 
A biography is a “secondary-interpretive-source” and it’s great if you want light manipulated reading but if you want to KNOW your Founding Fathers the only chance you have, Ryan, is “primary-source-materials” that way you are reading their own words and their own thoughts of their time.
 
Now Tubularsock has always been a fan of reading and hard cover books are a delight for Tubularsock.
 
Benjamin Franklin and Thomas Jefferson, are two of Tubularsock’s favorite guys.
 
And you, Ryan, may be interested in reading The Papers Of Benjamin Franklin published by Yale University Press. It has been a hobby of Tubularsock to read all of them over the years and Tubularsock just finished Volume 38 in January of this year.
 
Volume 43 will be published in 2019 so Tubularsock is a little behind.
 
As goes for Ben goes for Tom. Tubularsock read through Tom’s The Papers of Thomas Jefferson Princeton University Press but only to Volume 19 ending there due to research that Tubularsock was doing. This reading is all post school.
 
But realizing that you are a conservative dude you may want to stick with Lynne Cheney’s patriotic children books because the fantasy of America is preserved and you won’t be challenged by any thought at all.
 
Or Lynne’s 1981 lesbian novel Sisters. Tubularsock is pretty sure that when it comes to pent-up sexual desires conservatives are running high with patriotic hard ons!
 
But another favorite read of Tubularsock is the four volume work, Selected Works of Mao Tse-Tung Foreign Language Press, Peking. Now that may wet your interests even if Lynne’s lesbians don’t. Conservatives are such an odd lot.
 
And to cap this off Tubularsock subscribed to the National Review when William F. Buckley was involved for about four years primarily for the high art of buffoonery.
 
And still reads Breitbart News because for Tubularsock their insanity never stops! Love it!
 
So Ryan ,Tubularsock has a huge personal library so Tubularsock doesn’t have to go to a library to sit on his butt and read. Tubularsock even serves Wild Turkey Single Barrel by the double neat shot for the ultimate reading experience.
 
Tubularsock has always been enamored with Jefferson and his personal library and so created just that for himself except Tubularsock only has a handful of books in French!

And PLEASE for your own sake, go back to your 20 year old “Conscientious Objector” self ....... you were so much wiser then. Trust Tubularsock-As-Soothsayer on that!
Bill H. Added Jun 11, 2018 - 6:57pm
Tube - You never fail to comeback with a nuclear textplosion!
Booooooooom!!
Bravo!
Tubularsock Added Jun 11, 2018 - 7:05pm
Bill H. Thanks, Tubularsock does have an explosive personality. It may be due to Tubularsock's over consumption of POP-tarts. Or not.
Jeff Michka Added Jun 11, 2018 - 8:50pm
LOL Good shots, Tubular.   I wondered if Lyin' Ryan was doing that again with his Conscientious objector crapola.  I can't see it, Ryan has no conscience anyway.  "The end justifies the means, maybe,"  but there are no "means."  People need to apologize to Dave Volek for Trump's latest badmouthing Canadians.  Hey, Ryan, why not blame Dave for burning the Whitehouse down in the War of 1812?  We're gonna get killed with prices and jobs,  all those out of work coal miners and steel workers will never be back to work, with or without their opioids.  Their daughters will still be peddled down at the local Motel 6, nothing will change.  The people that will be really screwed by Trump's little trade war are the SAME GROUP OF SUCKERS THAT VOTED HIM INTO OFFICE will be the first hurt.  I don't know how bad I feel about that.  Electoral stupidity should have a price.
Mustafa Kemal Added Jun 11, 2018 - 8:55pm
Tubularsock,  please dont try those Pop-tarts together with that Single barrel Wild Turkey, it can do some real damage to your impressive diplomatic skills.
 
As for those wise investments in body-bags, do they have those in ETFs. Im thinking it may be time to invest but I would rather not take delivery right now.
 
Mustafa
Dave Volek Added Jun 11, 2018 - 9:12pm
Jeff
Sorry, it wasn't me that burned down the White House. My family didn't come here until the 1930s. Besides they burned our capital first in an attempt to punish upper Canada for not taking part of the revolution. And don't forget that upper Canada took in a whole bunch of political refugees at that time. What were they called? Now I remember "Loyalists". And these loyalists had all their rights stripped away. No innocent until proven guilty for this group.
 
Excuse me if I'm not making any sense. I just another masterbaiting drug addict.
Katharine Otto Added Jun 11, 2018 - 10:26pm
Mustafa,
I'm sorry if I confused you.  The main idea was that maybe the government needs the income, especially since it has reduced projected income from income taxes, including the corporate income tax.  I was trying to make a distinction between the types of taxes, income vs. consumption.  I am vehemently opposed to income taxes on principle, for reasons soon to appear in another post.  If I must be taxed, I would prefer consumption taxes, punished for spending money rather than making it.
 
Who benefits from any tax?  The government(s), first and foremost.  Tariffs also benefit the domestic industries and stocks of those who can use shifting policies to make money.  Otherwise, the individual always loses.
 
The idea of trade surpluses and deficits is complex and may not be entirely valid.  In Wealth of Nations, Adam Smith suggested the notion was overblown.  He said the greater part of any economy is internal.  Possibly a larger factor is the petrodollar.  As long as OPEC prices its oil in dollars, it will have artificial value, because other countries will have to sell products to the US to get dollars to buy oil from Saudi Arabia and other OPEC nations (except Iran).  If we want to reduce the "trade deficit," we need only divest ourselves of the petrodollar (haha), and other countries won't feel compelled to buy dollars by selling us stuff.
 
I'm hoping that an economic war will prevent a real war.  Both the US and China would be super stupid to go to war with each other, and I believe both Trump and Xi know it.  The US tariffs may make Chinese steel more competitive among our now-angered trading partners and perhaps cool our jets for awhile.
===========================================
Mefobills,
Thanks for your informed take.  I gather the key point is that our tariffs are good but the other guy's tariffs are bad.  China, especially, is bad because it bypasses banks or uses state banks to fund its chosen industries directly.  It doesn't explain why Trump steel and aluminum tariffs include Canada, Mexico, and the EU. 
 
I'm thinking that this whole globalization idea is overrated.  Beneficiaries are bankers, international corporations, stock market, oil industry, governments, and shippers.  Electronic debt-backed money transports a lot more cheaply and easily than steel and aluminum and other tangible goods. For instance, Germany has a high import duty on American poultry products.  Great, say I.  We do not need to export chicken, except to benefit Tyson, other factory farmers, and tax collectors, while polluting the home turf. 
===========================================
Flying Junior,
The tariff on solar panels came as a surprise to me, but I believe that is more specifically targeted against China than the steel and aluminum duties.  I read that Canada is our major external steel supplier.  The policies do seem erratic and counter-productive.  I agree about the natural gas and oil.  We seem to be exporting the good stuff and importing junk.
===========================================
Dr. Green,
Thanks for reading and for the compliment.
===========================================
Bill Kamps,
I always enjoy reading your business perspective.  I have to wonder how overhead factors into your computations.  I believe government regulation, as well as the American expectation that employers will provide health benefits and pension plans, contribute to companies' decisions to relocate.  You mention OSHA and EPA.  Would you say that their regulations are reasonable, or do they cost more than they are worth?
Mustafa Kemal Added Jun 11, 2018 - 10:43pm
Katharine, not to worry, you did not confuse me. Instead I saw a conflict and was trying to reconcile. Excellent post and comments
Katharine Otto Added Jun 11, 2018 - 10:55pm
Dino,
I feel sorry for those caught in the middle.  I don't feel sorry for the governments that play their citizens like pawns on a chessboard.
=============================================
Thomas Sutrina,
You seem better versed in these areas than I am.  If you are right, then Trump is only trying to level the playing field?  I'm not sure I understand "socialist economics," but figure it has to do with government meddling.  I didn't know about the rule regarding compensation to producers of, say, DDT.  That's horrendous, and a good topic for future discussion.  Thanks for your well informed contribution.
=============================================
Mike,
Right, right, right.  I don't know, but I would guess that even those thousands of pages have probably been revised and added to since NAFTA was instituted.  And what about exemptions?
===========================================
Dave,
Governments can trade favors and not much else.  The favoritism runs toward government friends and political backers.  I know this is a highly generalized statement, but what you describe is another case of government getting in the way with its hand out.  Meanwhile, we get the Keystone XL pipeline to help export Canada's oil.
 
Oh, about Trudeau:  You're saying what NPR also reported, that Trudeau said nothing new in his press conference.  The upcoming meeting with Kim Jong-un may have made Trump especially tense.
===========================================
MEFOBILLS Added Jun 11, 2018 - 11:03pm
Katharine,
The proper way to do things is with a Bancor.  This is an accounting device that is not money, but DOES mark trade in goods.  If a country gets out of balance in Trade, then the Bancor signals for an adjustment in exchange rate.  
 
Since all external trade is only Barter, then an accounting device that relates to barter is the proper form to mark exchange.  
 
What happens in the floating money system we have today is that the U.S  exports Dollars in imbalance.  Other countries import Goods into the U.S. and in exchange the U.S. exports dollars.
 
Not buying goods from U.S. mainstreet is abortion economics.  Other countries take their excess dollars won in imbalanced trade, and then they buy U.S. TBills.   This puts future American's into hock.  It also means once less car made, or one less refrigerator, etc.
 
Around 60-70% of the economic output is still distributed in the form of wages.  So foreign money vectoring into buying American debt paper has a multiplier effect on the destruction of American Industry and knock on social effects, which hollow out towns (and create the rust-belt).  Other knock on effects are things like the Opiod Crises, as American's are cut out of their livelihood.
 
Mercantilism (exporting more than you import) in today's world is to grab dollars because it is reserve currency.   The dollars are recycled back to the U.S. to buy TBills, which although considered as debt are also "near money."  T bills are highly liquid and can be converted at any time.
 
The action of buying a Tbill does this:  Interest rates low, Tbill Price High, Dollar Strong.
 
So, the imbalance of trade, especially the Mercantilism of China and Germany is a scheme to do the above, which then benefits teh finance class i.e. wall street.  At the same time it creates conditions to continue the Mercantilism.  
 
I notice that too many here at WB are in this Tariffs Bad mantra.   That is an implanted memory that you received from Birth.
 
I explained earlier that the U.S. got rich behind Tariff walls using Industrial Capitalism.  China is getting rich behind Tariff walls and using industrial Capitalism.  
 
The U.S. passed into Finance Capitalism after WW2, which is the spreading of  wall street and its money  around the world.   
 
Remember, Federal Reserve notes are NOT U.S. Dollars.  They are emitted from private banking corporations.  
MEFOBILLS Added Jun 11, 2018 - 11:09pm
As an added bonus, finance capitalism likes to import third world workers to take wage arbitrage; it exports jobs to take wage arbitrage.
 
So, it is destructive on many levels, and imbalanced trade is only one output.
 
Putting tariffs on some goods is a stop-gap, but NOBODY is looking at the main vector, which is the malformed money system.
 
Probably when Russia and China shove it up our ass and move away from dollar as reserve, only then will we have the wherewithal to deal with finance predators.
 
Also, dollar as reserve disallows a country from stimulating its own economy -  it is called Triffin's paradox.
 
Leakage stimulates the world economy.
Katharine Otto Added Jun 11, 2018 - 11:09pm
John Minehan,
It certainly looks that way.  Will saner heads prevail?  If so, when?
=============================================
Tubularsock,
I'm most impressed with your reading list.  Thanks for sharing.  It puts me to shame.  I happen to like biographies, even though I know they are secondary sources.  I'm not sure I would have the stamina to read all of Benjamin Franklin's or Thomas Jefferson's papers, but I have read both of their autobiographies.  Looks like you have a lot of support.
=============================================
 
 
MEFOBILLS Added Jun 11, 2018 - 11:18pm
In case anybody is wondering about the money circuit (also called flow of funds).
 
Let's use China:  1) American's buy China crap 2) Chinese company now holds dollars.  3) Yuans are emitted from China's state banks, to then swap for Dollars.  4) China sends the dollars back to the U.S. to buy TBills.  5) China now holds TBills in their account at the FED.  6) The mechanism I describe above i.e. Dollar High, Interest Rate Low  7) Dollars spin out of the TBill and into the hands of former TBill owner.  8) These dollars then re-enter the money supply into a dollar zone somewhere in the world.  
 
Note:  Private Banks around the world like to hold dollars as part of their capital position and as reserves.   This is an output of the Post WW2 Bretton Woods system.
MEFOBILLS Added Jun 11, 2018 - 11:28pm
Let me also remind everybody, that the U.S. is a continental country, which has energy and just about every form of mineral in order to fashion goods.  It has navigable riverways, and still reasonable infrastructure, and smart people. Plenty of farmland and ability to produce food.  
 
Although, the collective IQ is dropping with the admixture of Low IQ third world people, which in turn is causing higher social friction.  The population dysgenics has not reached a tipping point yet.
 
Overall, the U.S. wins the tariff war.   If there is one country in the world that can have an Autarky economy its the U.S.  .
 
Wall Street and Finance Capitalism is the real problem.  People actually believe that financial "instruments" are an asset in the same vein as real assets (like people, the earth, know-how, infrastructure, etc.)
Tubularsock Added Jun 12, 2018 - 1:39am
MEFOBILLS, Tubularsock agrees with many points that you make but your comment that “. . . Although, the collective IQ is dropping with the admixture of Low IQ third world people ...” is just a tad bit elitists, off base and false.
 
The Pilgrims who arrived at Plymouth Rock, or so it’s said, and founded this country built their first settlement in a low swamp area before the Native People explained that that wasn’t the brightest thing to do because of disease.
 
So you see the “first American settlers” weren’t the brightest crayons in the box and if you multiply that out ......... well, Americans as a whole HAVE NEVER been IQed up!
 
So let’s not place the blame on “third world people”!
 
And if that is not enough proof for you let Tubularsock present to you Exhibit 2, our current Imbecile-In-Chief-Trump. That phenomena is the crystallization of stupidity which you can not blame on “third world people”!
 
It rests right here in good old AmericKKKa!
Katharine Otto Added Jun 12, 2018 - 10:43am
Mefobills,
Sounds like you're agreeing with me that the domestic economy would do fine without imports or exports, as long as we can keep the profit skimmers on Wall Street and the Fed at bay.  That includes getting rid of the debt-backed monetary system.  I have heard that China is not buying so many T-bills lately, but Saudi Arabia may be buying more.
 
Perhaps if people understood that we could be more self-sufficient, it would generate more self respect.  I blame television more than foreigners for undermining IQ and creating conflict.  (The TV exacerbates the fear and distrust among and between groups.)
Katharine Otto Added Jun 12, 2018 - 10:51am
Tubularsock,
Agreed, and furthermore, many Southern planters learned a lot of useful farming techniques from their African slaves.  Discounting or demeaning other cultures helps no one.
 
IQ depends on willingness to learn, or curiosity that is systematically squelched by cultural rigidity of all persuasions.
MEFOBILLS Added Jun 12, 2018 - 3:19pm
 Although, the collective IQ is dropping with the admixture of Low IQ third world people ...” is just a tad bit elitists, off base and false.
 
No it is not elitist and false.  Third world immigrants on average have an IQ of 90.   Since the bulk of immigrants today are for low wage labor, we are gaining the lower slice of an already low IQ population.  
 
The U.S. is a destination country and could be selective.  It isn't.  The idea is to take the labor value of the immigrants in the form of low wage prices.  
 
It also is not helpful to move backwards into a low trust culture, which in turn means that democracy malfunctions.
 
See Putnam's book "Bowling Alone."   The science stuff is settled, my saying it should not be controversial.  
MEFOBILLS Added Jun 12, 2018 - 3:23pm
So you see the “first American settlers” weren’t the brightest crayons in the box and if you multiply that out ......... well, Americans as a whole HAVE NEVER been IQed up!
 
American IQ's were tested and set at 100 when the IQ testing first originated.  
 
These are large population samples, not "exception makes the rule" bad logic.  
 
You exception makes the rule statement does not make your case.  It is the shape of the statistical distribution that matters.  Further if you immigrate high IQ people who are predators, then that is also bad.  
 
The Rotham grooming gangs come to mind.   
 
In general, immigration in today's world is a bad idea.  The only benefit is when you immigrate select people who have needed skills, something like what China does.  And even then, the immigration rate is kept low - so assimilation can happen without tilting the culture.  
MEFOBILLS Added Jun 12, 2018 - 3:25pm
Sorry, Rotherham.   Despite overwhelming evidence to the contrary, people cling to shibboleths that multiculturalism and high immigration is a net benefit.  There is scant evidence for this assertion.  Being told something over and over is a form of hypnosis, that people accept without believing their lying eyes.
MEFOBILLS Added Jun 12, 2018 - 3:27pm
many Southern planters learned a lot of useful farming techniques from their African slaves
 
I think perhaps you heard wrong.  Negroes in Africa never developed farming cultures.  For the most part they were hunter gatherers, the same as American Indians.  Black African's were still in the neolithic.  
 
Thomas Sutrina Added Jun 12, 2018 - 5:29pm
Katharine O., you started with real facts, "All taxes are ultimately paid by the individual, and tariffs are taxes on consumption rather than income. The only beneficiaries of tariffs are governments and protectionist industrialists like US Commerce Secretary Wilbur Ross." 
 
Crony capitalist that can not compete with foreign producers lobby for tariffs as a way to stay in business.   The question seldom asked is why are they not competitive. 
 
One potential reason is government regulations cost money that are spread out into the product sold.  "Regulations cost are ultimately paid by the individuals, they are taxes on consumption rather than income."  (your base stating real fact Katharine.   Trump reducing regulation is the biggest reason for the booming economy.  It is a clear that the growth of regulations in the past 32 years under Obama, Bush, and Clinton didn't do voters any favors.
 
Out dated manufacturing methods is another reason for not being competitive.  The steel industry has been guilty of this, however; regulations may prevent the implementation of new methods that can be implemented elsewhere.
 
Welfare increases the cost of manufacturing by raising the bar of what a person will accept since they compare it to what they are paid to do nothing.  The reason illegal works work for less is that they do not have bar raised by welfare.  When state provide welfare to illegal works the bar is raised.   This argument is being made understanding that there is a society issue of how humans should be treated.   
 
An education system that does not provide trained workers increases the cost by reducing the pool of potential workers.  America has virtually eliminated for cost saving reasons trade training in high schools and has limited training in two year institutions.   
 
Education does not teach responsibility and the value of working which when combined teaches striving for excellence.   Welfare sends the opposite message that IT IS A RIGHT to get paid to do nothing.   So schools that have large poor populations it appears have not address how to get around this problem.  Illiteracy in poor welfare ridden neighborhoods are the highers in the country. 
Thomas Sutrina Added Jun 12, 2018 - 5:47pm
You can not eat dollars and the heat value is far less then the exchange value of dollars.  So foreign holder of dollars are going to exchange them for something.  So we know that only three thing are going to occur.  1) Dollars will be exchanged for something a person, business, or nation needs and to obtain dollars another exchange will take place to fill another's needs.   2) Dollars will be put into a vault.  3) Dollars could loaned to someone else with interest in dollars and principle paid back in the future.
 
Adam Smith said no trade will take place unless both parties benefit or duress by force to trade. 
 
A trade surplus or deficit is us a measure of the flow of dollars.  Those holding dollars would not do so if they didn't think they could in the future trade them for something they wanted.  Thus a surplus or a deficit only shows that the needs are being met in the nation with a deficit faster then they are meeting the people of other nations and that those holding dollars have confidence that they will get needs met in the future when they exchange the dollars they are holding or invested in the nation.
 
Basically a deficit say you nation is a good place to invest.  It has a stable and robust economy.  A surplus says the opposite.  The economy is not as valuable to invest in.
 
Why is a nation a better or worse place to invest dollars into is answered in part in my comment published on this string just prior to this one.
Tubularsock Added Jun 12, 2018 - 7:40pm
MEFOBILLS, As for FARMING:

Both Africa and South and North America had early Indigenous Peoples practicing farming. The work force were mostly woman.
By the time the Pilgrims showed up the “Indians” advised the newcomers on how to fertilizer their crops.
You know those newcomers bring the IQ down!
Cheers!
MEFOBILLS Added Jun 12, 2018 - 8:26pm
LoL  West Africans along the Atlantic Coast (Biafra and Igbo) had a thriving farming culture and intensive cultivation.  sarc 
Even in the Paleolithic there was some small plantings, where the women would tend while the men hunted.  
With regards to Indian tribes they had the same pattern, they were still in the stone age.  
Northeast Asian immigrants tend to bring the IQ up, because of their higher group IQ, while other groups have lower IQ's.  
Apparently this is news to some of you people, when it should be common knowledge.  
Katharine Otto Added Jun 12, 2018 - 9:03pm
Mefobills,
The US would probably not be so attractive for immigrants without the welfare state.  And, I doubt so many refugees would be fleeing their own countries if the US and others weren't creating mayhem, or stirring pots of internal unrest.  
 
As far as IQ is concerned, I believe it is overrated and doesn't include practical skills without which the intellect starves.  Africa has so many different cultures that it's hard to generalize, but the historian who explained this to me said the African slaves had cultivated rice and I think indigo and knew things about irrigation and locks for directing water flow.
 
That there are so many mass migrations comes in part from people being displaced from their traditional homelands, flooded out by dams, ground water polluted by industry, forests being converted to mass cultivation for mega-farms like oil palms for export.  The Land Grabbers is a good book that details how this is happening all over the world.
Katharine Otto Added Jun 12, 2018 - 9:16pm
Thomas,
Good point about regulation.  I think that's a big reason that some companies are leaving the US.  How much regulation is needed, and how much is enough?  I'm struck by the fines agencies like the EPA and OSHA charge.   Instead of requiring companies to fix the problem, the agencies band-aid the problem and collect large amounts of money for themselves.  
 
Agreed about welfare, too.  
 
Why aren't the protected industries competitive?  Lots of reasons, such as the regulations you mention, the higher wages and benefits that are expected in the US compared to places like Mexico, higher real estate and other costs, subsidized industry in other countries.  Taxes, including payroll taxes.  
Katharine Otto Added Jun 12, 2018 - 9:24pm
Tubularsock,
I believe there was and is a huge clash of values, and the descendants of the Europeans still believe their way is the only way, all based on money.  Tomochichi, the Creek Indian who befriended James Oglethorpe when he founded Savannah, and visited London with him, was amazed that people actually liked permanent dwellings.
 
We can never know what has been lost, knowledge wise, by exterminating the Natives instead of trying to understand them.  I remember a book I read, in which a Cherokee woman complained that her tribe liked to share, but "White man take all."
Mustafa Kemal Added Jun 12, 2018 - 11:17pm
MEFOBILLS, thank you for your contributions.  Reading you is always a pleasure.
 
Can you help me to understand Triffin's paradox in this context?
As I understand it, it is the idea that a country with a reserve currency MUST run a deficit. 
If this is true, then isnt a consequence of using Tariffs to reduce deficit going to contribute to the death of petrodollar as the worlds reserve currency? And if motion is made in this direction might there not be second hand costs associated with Tariffs through this mechanism?
 
Mustafa
MEFOBILLS Added Jun 12, 2018 - 11:20pm
 African slaves had cultivated rice and I think indigo and knew things about irrigation and locks for directing water flow.
 
North Africans Katharine, the Tuareg people, who were descended from Berbers.  Not Negro.
 
IQ is an excellent predictor.  I could take a North East Asian and set them down in any part of the U.S. and predict with high assurance that they would not become a welfare recipient, and will also gain the technical skills to operate in a technical society.
 
You don't believe your eyes?  We can immigrate Somalians forever, and high percentage will become a drag, a permanent underclass.  
 
This same sort of mind bending inability to see reality is undermining Europe, who are immigrating indigestible "rapefugees."  In Germany it is estimated that the housing/welfare costs are more than an average German labor makes.  
 
Genetics and evolution matter.  There are differences between the races.  Those of you who continue to ignore this reality are whistling past the graveyard and unwilling to come to terms with what is obvious if you would look.  
 
Hypnosis runs deep.
 
 
 
 
   
Mustafa Kemal Added Jun 12, 2018 - 11:58pm
Tubularsock,
re:" I remember a book I read, in which a Cherokee woman complained that her tribe liked to share, but "White man take all.""
 
I hung with a few Navajos back in my younger years, and they freely admitted that their ancestors were essentially thieves; they supplemented their gathering and animal husbandry with raiding, not sharing.
 
What does she say about the the Commanche? Woo ha!
Or my favorite, the Apache? Sharing, no.
 
Remarkable people, much to be learned from. But noble red man, no.
 
Mustafa
 
 
 
Alton Wroten Added Jun 13, 2018 - 6:35am
Trump is not a politician. His motives will not be the same as the long line of self serving wastrels who have occupied the White House for decades. He is a successful businessman, he lives by the carrot and stick instead of mealy mouthed platitudes and empty promises. Tariffs are items of negotiation. Patience, people. The US can inflict real harm to any economy we so choose to, but we have demurred and bluffed for so long we're viewed as a weak and weak minded giant. That perception is changing and to our benefit. There is no nobility in weakness.
Katharine Otto Added Jun 13, 2018 - 10:16am
Mefobills,
I don't disagree with you, but I think we're talking about different things.  Taking a bunch of desperate and starving people who don't speak English and dumping them into communities with their own share of desperate, homeless, and unproductive people will only put more stress on systems that are already crumbling.  Immigration is not the answer.  Abrupt transition, as in freeing the slaves in the US, or ending apartheid in S. Africa, also put undue stress on systems that were not prepared to handle it.  
 
At the same time, I wonder if the relatively higher IQs of American "leaders" equip them to solve the problems they have created, such as the welfare state that rewards failure and punishes success.
 
While I appreciate technology, I believe it, like IQ, is overrated.  An unbalanced dependence on it is not smart.
Katharine Otto Added Jun 13, 2018 - 10:23am
Mustafa,
I don't know enough to contest what you write.  I only know that Navajoes lived in the arid and resource-poor West, while Cherokees lived in the rich, verdant, water-rich and Coastal areas, where abundance was the norm.  They were part of a five-tribe confederacy that spanned the eastern and southern part of the country, and they were known by their specialties, such as flint-carvers.  
 
It's hard to find information about the earliest days, and even that is distorted by European assumptions, beliefs and language.  I don't have romantic illusions, because I simply don't know.  I do know that they stepped lightly on the land and respected it, an attitude I dearly miss.
Katharine Otto Added Jun 13, 2018 - 10:31am
Alton,
Thanks for your comment.  I have nothing if not patience.  It's an interesting show to watch, not only Trump, but all the reactions to him, his policies, and the US in general (both within and without).  
 
To paraphrase Shakespeare, we are all but actors on a stage.  Trump is playing a role that the world has created for him.  If nothing else, it's waking people up.
 
Katharine Otto Added Jun 13, 2018 - 10:33am
Mustafa and Metrobills,
That Triffin's paradox question is interesting, and I would like Metrobill's take, too.  Thanks for asking.
Tubularsock Added Jun 13, 2018 - 10:48am
Mustafa Kemal, re:" I remember a book I read, in which a Cherokee woman complained that her tribe liked to share, but "White man take all."
 
It was Katharine who “shared” that statement. Not Tubularsock.
 
There are many tribes in North America and like you stated not all were “noble”.
 
Much like that picture-book grandma used to have with the First Thanksgiving. It never happened like that! Pilgrims weren’t “noble” either. You know how immigrants act!
Dave Volek Added Jun 13, 2018 - 11:45am
Katherine
You said well:
 
To paraphrase Shakespeare, we are all but actors on a stage.  Trump is playing a role that the world has created for him.  If nothing else, it's waking people up.
 
But I wonder if the world is going to learn the lessons?
MEFOBILLS Added Jun 13, 2018 - 12:52pm
Taking a bunch of desperate and starving people who don't speak English and dumping them into communities with their own share of desperate, homeless, and unproductive people will only put more stress on systems that are already crumbling.  Immigration is not the answer.
 
 
That is why you help them where they are planted.  Also, you make a mistake assuming that they are "desperate and starving."  
 
Most immigrants are healthy young men who are seeking economic opportunities.  The numbers of people who are persecuted and truly helpless are small.
 
A large number of "migrants" use travel visas and never return home.  
MEFOBILLS Added Jun 13, 2018 - 1:03pm
Can you help me to understand Triffin's paradox in this context?
As I understand it, it is the idea that a country with a reserve currency MUST run a deficit. 
 
The trade deficit means exporting of dollars in exchange.  These dollars can become FX and reserves in "private banks" located throughout the West (and including some banks in China).  So, the answer to your question is YES.
 

If this is true, then isnt a consequence of using Tariffs to reduce deficit going to contribute to the death of petrodollar as the worlds reserve currency? 
 
The Petrodollar and TBill standard came into being in 1974 with advent of Kissinger -Saudi Agreement.  Excess dollars from unbalanced trade are to be recycled back to the U.S. to buy TBills.  The agreement prevents Saudi from having their own Bourse, they must price oil in dollars, and recycle the petrodollars into dollar exchanges around the world.    The answer to your question is YES
 
And if motion is made in this direction might there not be second hand costs associated with Tariffs through this mechanism?
 
The second hand costs are that more returning dollars go into buying goods from mainstreet, and fewer dollars go into buying American Debt instruments or other financial paper.
 
All foreign trade is only barter.  This is a rule like the third rail.  Touch it and you die.  
 
Note how the petrodollar standard ignores economic science, to then benefit "finance."
 
Money's true nature is law, and by extending Federal Reserve Notes to be world reserve, the law was extended.  
 
In a nutshell, this is why the U.S. is the worlds policeman, and center for "globalism."  The former center was London, but the ((parasites)) jumped to the U.S. by 1912 and fully after WW2.
MEFOBILLS Added Jun 13, 2018 - 1:08pm
If countries are to be truly sovereign, then a "third currency" like the Bancor should be used for international commerce.
 
Extension of you money past your borders implies extending your law, which is an impossibility in a world of sovereign countries.  Any country that has a reserve currency will become a hegemon by definition.
 
Schachts trading banks isolated debt instruments to those banks.  Also, said banks were a mechanism for exchanging goods only.  This would be another way, or use both.
 
Mustafa Kemal Added Jun 13, 2018 - 3:18pm
Katharine,
re:" I do know that they stepped lightly on the land and respected it, an attitude I dearly miss."
Me too.

Thank you for your response. There may be something in what you say regarding agricultural verse nomadic in resource poor country.
Trying to tell a Cheyenne that they needed to find a  160 acre plot and settle down like the white man was not comprehensible, or possibly possible, to them. To them, the whole plains were theirs down to texas. And to define what was theirs was done through a combination of agreements with other tribes and white men and conflicts with them.    
 
There also is a difference between "in tribe/confederacy" and without. And if one  thinks that being a citizen should be treated as in tribe but you are treated differently than what you expect, it sends a sign, a clear sign. 
Certainly, the Navajos and Apache shared within tribe but it was a tough life and they were very disciplined. 
 
 
BTW, while Im on one of my favorite subjects, since most people dont know, let me tell you about the birth of the Commanches.  The modern horse is not native to North America,  but in the Pueblo Revolt of 1680, many spanish horses were released. Eventually these horses bred and moved north. I am imagining a few years later a young Shoshone earth grubber living in Wyoming, and his colleagues finding a way to get on top of one of these creatures. What a ride that must have been! Anyway, the tribe split into Shoshone (conservative) and Commanche (liberal)  with Commanche on horseback. Evidently, they almost lived on them. Unlike the aquiline Souix, the short compact Commanches quickly became the finest light cavalry in the US, driving the Apache out of Texas.  The Apache remained "mounted infantry" When you see an Indian shoot a bow from underneath the horses neck, that is Commanche. No Sharing there, but does it does not matter to me. 
 
The Commanches were a primary reason the Spanish never really possessed the US. They also  kept Texas on pins and needles (terrorized) for 150 years, until the invention of the Colt revolver. Then it all unwound. Fehrenbach is an excellent read.
 
Mustafa
 
Jeff Michka Added Jun 13, 2018 - 9:21pm
Katherine:  It's not like I care, but the justification for tariffs being claimed as "job saving," and somehow, businesses will disrupt their supply chains to play into Trump's hand, any more than tariffs will get all those coal miners and steelworker back on the job.  That sheer fantasy,  This nonsense will only hurt those vast unwashed Trump voters in "fly over America."  You think Trump actually cares about them?  Only cares they can be conned into voting for him.  Oh sure, it was the Chinese and European Union that came into the States and closed steel mills and fabricator down.  Owners of those facilities closed their own doors, partly by not upgrading their facilities since Carnegie's time.  And have to correct you a bit:  Carnegie was the first capitalist  that spent millions on the first public image campaign culminating in Trump.  Andrew Carnegie was not a nice man or kind to anyone other than Andrew Carnegie.  I;m sure your books on Carnegie will confirm that aspect of his "reign of corporate terror."
Thomas Sutrina Added Jun 14, 2018 - 8:19am
Jeff this is being shouted by Hillary and by the leadership of both parties, "Only cares they can be conned into voting for him," for years.  That is why we got Pres. Donald John Trump.  I can not think of one president that has done everything right.   So pointing out his failures is less important then the promises made to voter in the campaign to become president come to reality.  This is my measure of caring.   
 
How your attach Carnegie to Trump is amazing example of creative thinking. 
Katharine Otto Added Jun 14, 2018 - 10:34am
Tubularsock,
Right.  I agree that history is written by the winners who speak the language.  I appreciate your continued feedback.
Katharine Otto Added Jun 14, 2018 - 10:35am
Dave,
I sense that the world has to learn, but we can't predict what it will learn.  All experience teaches, but what is learned is an individual matter.
Katharine Otto Added Jun 14, 2018 - 10:47am
Mefobills,
I agree with helping people where they are, but that doesn't mean money or prefab food, which gets sidetracked by government controllers.  I've long suggested that our military should carry shovels instead of guns, and teach people survival skills.  For instance, I knew a Peace Corps volunteer who was involved with teaching Africans how to filter their water to get rid of the schistosoma parasite.  These are simple concepts that help communities for generations.  
 
I think there's a difference between the individual and the group, where immigrants are concerned.  In other words, they may not be "desperate and starving" when they start out, but put them in a group on a ship, or refugee camp, and the crowded conditions create desperation and starvation, as well as disease.  That's why we agree with helping them where they are.
 
Thanks for explaining how the financial system works as it concerns the trade deficit and the petrodollar.  From my point of view, the decline of the petrodollar will be ultimately good for the USA, curb government overkill, and rein in the Fed.  
 
The second hand "costs" you mention sound like benefits to me.
Katharine Otto Added Jun 14, 2018 - 10:57am
Mustafa,
Thanks so much for that piece of western native history.  I have so little foundation that its a little hard to absorb, but every bit helps.  I hope you will consider writing a whole post on this subject.  I'm sure others would be interested, too.
 
By the way, I have read your post about the origin of your name but didn't comment, at least not yet.  Once again, I was struck by the limitations of my own knowledge.  It's humbling, but always welcome.
 
Katharine Otto Added Jun 14, 2018 - 11:06am
Jeff,
I can't say I disagree fundamentally with anything you write.  I didn't mention "job saving" anywhere, nor do I believe tariffs will save jobs.  It may shift jobs around and maybe kill a few, which is why I suggested the move is more to raise federal revenues than anything.  The government needs the money, and everything else, from a government point of view, is secondary.  At least, that's how I see it.
 
If you thought I was extolling Andrew Carnegie, you misunderstood.  I agree he was big into self-promotion and hypocritical in that he let his partners and foremen do the dirty work of cracking the whip over the laborers.  I can't say much more now, because I've only read a third of this 800-page biography.  
Katharine Otto Added Jun 14, 2018 - 11:11am
Thomas,
I think it's impossible to predict the long term effects of President Trump's actions.  I certainly don't presume to know all his motives but do believe he cares.  I'm a status quo rattler myself, so respect that, and am impressed that he's getting away with it (so far).  He can't be all bad if the New York Times hates him.
MEFOBILLS Added Jun 14, 2018 - 1:55pm
Kathrine,
There is plenty of economic overhead to "help them where they are at, and in ways that become sustainable."
 
I don't know how I can say it any more clear:  There is a $7500 gap in production and debt formation for every man woman and child.  That means that that debt formation makes up the difference so that American's can consume what they produce (and what other countries produce).
 
We already produce at a high level, and with the advent of smart machines it is only going up.
 
Industrial Capitalism/Social Credit Theory/Sovereign Money are are mostly similar in that the money cycles in such a way that the Gap can be overcome.   Additionally there are huge losses to fund MIC and many other Parasitic "plutocratic" organizations.
 
A large component of what people produce is wasted or shifted away in the form of prices or debt formation (which prices the future higher.)
 
Look how much Russia is accomplishing from an economy many times smaller than the U.S.
 
So, helping them over there not only is do-able, it is also do-able to organize their labor to from a multiplication factor.
 
Let's face it.  It is racial.  Negroes especially do not do well at organizing large projects.  Even in militia armies they all promote themselves to generals.  A militia of all generals.  
 
We can call it a peace corp if you want.  Immigrating people because we "feel bad" is some of the worst logic imaginable, and destroys the host nation.  People are duped to feel bad through a paid for press.  It is an implanted memory.
 
We have problems and they have problems, we should start with ourselves first.  Our parasites are hiding in plain sight, and many of them are psychopaths who are happy to delude everybody with a paid for press and various noxious nostrums.  The paid for press is busy deluding people and diverting attention from our psychos, who walk among us.  
 
Basically, the money system is ground zero, the main vector.  Ignore it at your peril, as everything else is subordinate.  
 
It is ok to "feel bad" for the immigrants, it is also not ok to destroy your own country through policies guaranteed to do destruction.  
 
MEFOBILLS Added Jun 14, 2018 - 2:06pm
As I said earlier, the U.S. can have an autarky economy.  It has everything it needs to make goods as prices.  
 
England, an Island nation, DOES NOT.  Economic theory that emanates from England pushes for Free Markets.   This is so England can be mercantile and grab minerals from "colonies" and then fashion higher priced goods to get the increment of production.
 
England has since passed into an advanced death cycle of parasitic finance capital, where they make money by shoveling finance paper around, and try to control "markets."
 
Many of the WB people here are passing this notion "tariffs bad" as they were trained in British/Jewish economic thought.  
 
The U.S. is both and Land Power and a Sea Power.  Britain is only a sea power and its economics are "globalism" and Atlantic Theory.  
 
Atlantic Theory, Neo-Liberal Economics, Neo-Con politics.  All of this is unnecessary for land powers.  I'm telling you straight up... it is bull shit not rooted in the reality of what America is.
 
Tariffs are OK in the form that Trump is using.  It would NOT be OK if said tariffs were to support American monopoly.   
 
Trumps tariffs are to protect American industry from predatory foreign competition.
 
The U.S. CAN BE reduced to drawers of water and hewers of wood if we allow ourselves to become a resource extraction economy for foreign producers.
 
As I said earlier, just go to a Pacific Port and watch trains full of shredded scrap metal go from East To West, while trains full of finished goods go from West to East.  
rycK the JFK Democrat Added Jun 14, 2018 - 2:51pm
More to the point here is the large trade deficit that the US  has with various trading partners. Beyond that, the two nations with the highest tariffs are India and China and they both have high growth rates. 
 
Is there an economic connection?
 
Why should we tolerate a large negative balance of trade??
 
We  should do what? Nothing??
Thomas Sutrina Added Jun 14, 2018 - 2:54pm
Mefobills, I find myself seeing you as a split personality.  The above two statements are to me the positive half.  That $7500 gap is the monkey of government debt on the citizens backs.  That debt is a product of the failure of the federal government to govern with the consent of the governed.  They a govern at the consent of crony capitalist, the belt line lobbyist.  Tariffs just feeds the beast and spurs on spending and debt.  That is why Trump ran on Tariffs.  He got the support of the rank and file crony Republicans.  And he delivered.  What we do not know is strong arming the EU especially, Canada, and Mexico will result in an overall tariff reduction, fair trade, another campaign promise of Trump.  Then he can met both.  And if they do not succumb he tried.  Trump wins but the voters loose.  The real loss is that neither Trump or Congress are reducing the debt or its growth rate.  As some nations in the EU have shown there is a debt cliff and America is racing toward it.  Can not grow a nation out of trouble without reducing government spending because government spending is a brake on growth.  We have the potential of a bigger brake then accelerator.
 
Our crony GOP Congress has tired to tell us we were getting a tax cut, repelling ACA, etc., but they are just moving the deck chairs on the Titanic.  Many the Republican congressmen have come to realize that the voters will not vote for them after they have broken promises.  When the opportunity occurred they showed they  never intended to keep those promises. 
 
Democrat have also shown that they never intend to keep their promises.   Obama made the fuzzy statement of 'transforming America' that created many different images in those that voted for Obama and the 2008 Democrats that sweep into control of Congress.  Great for getting votes in 2008 but insured failure afterwards.  Just listen to the Democratic voting blocks that have not had their particular image come about. 
MEFOBILLS Added Jun 14, 2018 - 5:58pm
Thomas, 
 
You may object to some harsh truths, and from that you "derive" the diagnosis of split personality.
At no time do you hear me calling for harm.
I'm entirely consistent, and that may be giving you cognitive dissonance.  
 
  
MEFOBILLS Added Jun 14, 2018 - 6:04pm
  That $7500 gap is the monkey of government debt on the citizens backs.  That debt is a product of the failure of the federal government to govern with the consent of the governed.  They a govern at the consent of crony capitalist, the belt line lobbyist.
 
Actually it is public debts that government takes on, which allows private citizens to buy "their output."
 
Government does not follow constitutional mandates, but instead outsourced the money power to private banks.  The debt is a product of the PEOPLE in general to not bother to learn how the money system works.  It is kept opaque on purpose.  
 
There was a study done in England where Parliamentarians were asked where money comes from.   The majority of them could not answer the question correctly.
 
They a govern at the consent of crony capitalist, the belt line lobbyist.
 
Yes, of course.  
 
 
Thomas Sutrina Added Jun 14, 2018 - 7:46pm
Mefobills, the split personality observation was and overall observation on the totality of your WB statements.  I am sure a few people think I have split personality.  
MEFOBILLS Added Jun 14, 2018 - 10:02pm
Thomas if you could be specific, that would be better.  Just making statements is fine, but don't expect to be taken seriously.  
 
My worldview is not something ad-hoc, it was built up with difficulty and hard work.  You won't find too many seams that I haven't already investigated.  Of course, I always welcome correction.
 
This "split personality" you observe is probably based on "Low information" on your part, meaning that I cannot spend hours going through monetary history, genetics, evolution, politics, etc. and explaining nuance.   I try.   A forum like this is limiting by its nature. 
 
Some people arrive at a position because it was handed down to them by their parents, or their group.  I can tell you are a thinker and it takes some effort to come to new positions.  
 
Katharine Otto Added Jun 15, 2018 - 10:31am
Mefobills,
I actually agree with everything you write and find it reinforced in my research.  I've been re-reading my notes on Adam Smith's Wealth of Nations for my next article, and am struck by the entitled attitude of the Brits and the cold-blooded approach to labor.  It seems unearned wealth is somehow superior to earned wealth, but it's also obvious that Britain doesn't have all the resources it needs, so must engage in trade to fulfill all its needs.
 
As far as the US is concerned, I believe the dregs of society are showing the faults in the government-over-the-people system that is crumbling for lack of foundations.  You allude to the fact that Congress abdicated its fiduciary responsibility by giving it over to the Fed.  I agree.  But I also believe that government does not have the right to promise people's futures or money.  Should people honor debt taken on in their names without their knowledge or consent?  I think not.  Once people wake up to the fact that unborn future taxpayers are expected to foot the bill for Congress' reckless spending, they might justifiably repudiate the debt, and bye, bye Fed.
 
Regarding helping other countries, we don't know how to help ourselves, so what business do we have "over there," except to meddle and interfere?  When we put our ideals to work here and show some success, maybe we'll have something useful to teach the world.
 
I don't think anyone is good at organizing large projects, at least not for long.  I do believe smaller is better, and US size is one of its problems.
 
Regarding Thomas Sutrina's comment above about split personality, I suspect that you are sometimes hard to understand.  People well versed on a subject (or more) can assume too much about their readers' level of comprehension.  You generally do a good job of explaining, but at times I'm not sure I understand, either.
Katharine Otto Added Jun 15, 2018 - 10:37am
rycK,
The only reason we have a negative balance of trade is that we buy so much junk from overseas.  The more appropriate question is why are Americans so gullible as to waste their money on more than they need?  "Cheap" has become a fad, and "consumerism" has become like a religion.  How many televisions do you need to sell you propaganda, drugs, and a Madison Avenue-created fantasy life?
 
What should we do?  Appreciate what we already have, maybe?
Katharine Otto Added Jun 15, 2018 - 10:46am
Thomas,
Agreed on the idea that the government has lost the consent of the governed, if it ever had it.  My reading suggests the government netted the governed under its laws pretty much without the consent or even knowledge of the governed.  The "governed" found out the hard way, when the tax collectors or militias arrived at their doors, such as with the whiskey tax.  
 
Our exchanges have touched on this before.  I think you still believe the Constitution was designed for the people's benefit, but if that were true, why did the Constitutional Convention go far beyond its stated purpose, in utmost secrecy, with ratification that bypassed state legislatures?  No.  The people were kept completely in the dark about what was being done in their names, and it is still happening.
MEFOBILLS Added Jun 15, 2018 - 7:57pm
Regarding helping other countries, we don't know how to help ourselves, so what business do we have "over there," except to meddle and interfere?
 
Katharine, my position is that we cannot disengage from the world.  We also need some way to de-fang those who "feel" instead of think.  A large percentage of the population feels and in their mind it gets conflated with thought.   This then leads to people who think immigrating millions of third world people is the greatest thing, because it is morally correct.
 
By helping them over there, it deflects the moralists who substitute feeling for good policy and thought.  
 
I've posted gumballs before, and anybody who denies the reality posited in this video is simply not using all of their faculties:
 
gumballs
 
With regards to large scale planning, evidence abounds.  The recent Crimean Bridge in Russia was done in record time, the Chunnel, Interstate Highway System, Space Programs, even World War.  
 
Some people groups (African's, Aboriginals, and many Third World People's) for a variety of reasons, do not do these sort of large scale planning and development.  They actually need help.  Population pressure if making them emigrate, along with predators who want to use their life energy to make gains.  In the process it destroys host countries.  
 
Here is black pastor explaining things in no uncertain terms to his congregation:
 
no enduring cities no planning
 
 
Jeff Michka Added Jun 15, 2018 - 8:59pm
Well, not to forget what the last national outing of "America first" bought us: WWII.  But then, doesn't matter to Trumpists.   Charles Lindberg is dead, but we've got "Lindy" embodied in Steve Bannon.  
MEFOBILLS Added Jun 15, 2018 - 9:37pm
We know who started the wars and why.  It was an oligarchy of special interests out to make "money" on other peoples sufferings.
Pyschopaths exist in ALL POPULATIONS.  
MEFOBILLS Added Jun 15, 2018 - 9:40pm
During the age of exploration, when Europeans went into Africa they found food tribes to cannibals in a 2:1 ratio.  Food, Food, Cannibal, Food, Food, Cannibal, Food Food, Cannibal.
 
This pattern repeated itself on all the major river ways.
 
South American Indian tribes would offer missionaries the choices piece of meat.   They would delineate parts of still live "Food People" by mixing mud and dribbling it onto the bodies, where it dried would be a mark of where to cut.
 
Katharine Otto Added Jun 16, 2018 - 10:30am
Mefobills,
I watched both YouTube videos you recommended.  They both ended where I would begin.  It's fine to "help them where they are," but the next question is "How?"  Same with the idea of Africans never having built anything.  Well, Egypt is in Africa, but I suspect you will tell me Egyptians were a different race of people.  Do we need more cities in the world?  Cities are parasitic, according to me, and require a lot of farm to feed.  Same with industrialization, carried too far.
 
To suggest that lasting cities is the primary determinant of civilization reminds me of Adam Smith's supposition that gun power is a measure of "civilization."  Are cities, highways, pipelines, bridges and wars measures of genetic superiority?  Is the hive mentality genetically superior?  
 
The idea of genetics is a can of worms.  The fad of genetic engineering from everything from foods to medications to treatment of inherited problems conjures up notions of Frankenstein and The Island of Dr. Moreau.  The best technology in the wrong hands can do worlds of damage.
Katharine Otto Added Jun 16, 2018 - 10:31am
Mefobills,
By the way, the oligarchs who exploit those weaker than themselves may be clever, but they are not smart.  
Thomas Sutrina Added Jun 16, 2018 - 7:40pm
Cities only came about when a single person can produce more then his needs and do it predictably year after year.   Cities came about when the transportation system connected those willing to trade.  The cities became trading centers and then centers of product manufacture.  Communication is needed to coordinate the trading of goods.  And government came about to protect the people from those that wanted to take it and from criminals.  It set up rules and justice.  Government employed people to do all this and in return taxes the traders.   Africa had cities and civilization as did every continent on the planet since man came to the same answer to how to make life better.  Oligarch is a organizational and governments concept that has worked, as are a few others.  My guess is that man has only effectively created less then a half dozen different government approaches.  Variation are in the hundreds but the basic approach are just a few.  The same can be said for the approaches for paying for government.
 
 
Katharine Otto Added Jun 17, 2018 - 12:26pm
Thomas,
Your assessment is valid within its context, but not everyone would agree that the oligarchical system has worked.  In fact, more and more people are seeing that it is devitalizing, to human beings and the natural world.  
 
Agreed, too, that man has created few different government approaches, at least as far as we know.  All rely on social stratification.  Even Karl Marx, who related social problems to "class struggle," simply wanted (or claimed he wanted) to re-arrange the hierarchy, for a "dictatorship of the proletariat."  
 
Either way, it becomes a matter of paying people to boss you around.  I can fully accept that other people might be willing to do that, but I don't believe it's right for anyone to tell me what I want, then force it on me and expect me to pay for it.
George N Romey Added Jun 17, 2018 - 12:30pm
Katharine most people are simply here to serve the needs and desires of the .01%. As you have rightly pointed out our debt based, fractional reserve monetary system, supported by the Fed is the head of the snake. It keeps people addicted to a system that will increasingly use and abuse them. It’s all one big facade perpetrated on the ignorant and blind. 
Thomas Sutrina Added Jun 17, 2018 - 1:25pm
Katharine and George, simply put some people are better and creating, accumulating, and trading and over time they have more wealth then others.  This creates classes, always have and always will and man has seem to accept this because they add value.  The class that governments and oligarchies create are made up of primarily the inheritors.  They do not posses the capacity of the earlier generation by due to force retain the wealth and thus class.  This is the definition of a class based society which an oligarchy is.   
 
George the vast majority do not or never have served the needs of the 0.01%.  What happens in that they get a cut of many to even all trades which they only get through force of government.  This may not be a barrel but regulations and the threat of jail is just as effective. 
George N Romey Added Jun 17, 2018 - 3:23pm
Thomas you are exactly what the .01% wants. Addicted to a system they think serves them well.
Flying Junior Added Jun 18, 2018 - 4:23am
When did cities finally come about?
 
Let's look back to Rome and Jerusalem for some answers.
 
London is a very old city.
 
When were the first cities founded in India and China?
 
How about the ancient cities of Egypt?
 
Carthage?  Athens?
 
I am guessing that cities evolved from villages.  Which in turn evolved from families, clans and camps.
 
Human beings have always been social creatures.  The first city had a great and powerful caveman as its chief.
 
What about tribes and villages in ancient North America?  Was there a transportation infrastructure that enabled Native American capitalists and their employees?  Yes there was.  Transportation was accomplished by running, walking and carrying.
 
The economy was based upon living off of the land.  The tribe took care of its young, its elders, its widows and orphans.  It was no different on any other continent.  Hunting and gathering.  Followed by agriculture.
 
You superimpose RW politics on ancient history.  Ridiculous.
Katharine Otto Added Jun 18, 2018 - 10:19am
FJ,
What you write is supported in one way or another by everything I read, except for the part about the great and powerful caveman chief.  Who can know that?  Maybe the chief(s) were the women who kept the hearths and raised the infants.  
 
Karl Marx and Friedrich Engels described the growth of cities from communal societies in The Communist Manifesto.  Aggregation of people into larger and larger cities and nation-states was the result of trade and conquest, protection from bandits, and the like.
 
Who is the "you" that superimposes RW politics?  We make a lot of assumptions about the ancient past, but we have little evidence to guide us.  Our paternalistic traditions assume male dominance, but many Native American tribes were matriarchal.
Katharine Otto Added Jun 18, 2018 - 10:25am
George,
You are only a slave if you allow it.  The idea that the 0.1 percent is perpetually in control is victim thinking.  They are sabotaging themselves by undermining their own foundations. 
 
The Fed is a puff of smoke, in the sense that the national debt can be renounced as soon as people recognize the government has no right to promise their futures.  Already the younger folks accept Social Security won't be there for them.  Ask your new co-workers whether they feel obligated to pay on the national debt.  
Katharine Otto Added Jun 18, 2018 - 10:31am
Thomas,
I can't agree with the simplistic idea that some people are better at commerce and deserve their wealth.  Many who have vast stores have been ruthless--or their ancestors were--and exploited everyone and everything that could be useful to them.  The stock market is a good example of a rigged casino, with stock churning the name of the game, often with other people's money.  The stock market adds no value, and in fact, depletes it, yet the gamblers with other people's money make millions.
George N Romey Added Jun 18, 2018 - 9:42pm
Katharine I don’t feel an obligation to this country, the banks or the debt. They all could fail and I’d find a way to survive.
Mystique Ulh Added Jun 27, 2018 - 2:12am
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