whiterock said:
ATL Bear said:
whiterock said:
FLBear5630 said:
whiterock said:
nein51 said:
boognish_bear said:
I've been saying they need us just as much as we need them. There is no method to replace the U.S. market. It doesn't exist.
It's so obvious, yet his critics studiously ignore it, choosing to make arguments assuming that we are the only ones who will bear any pain at all.
Sure, we are going to go thru growing pains.
Everyone else is going to go thru withdrawal pains, which in some cases will carry existential risk.
we have the best assets. We have the best hands. It is exceedingly difficult to craft a viable scenario where we emerge from this in a worse position. We are too big, too strong, too important to everyone else.
The Hubris is incredible. You think people around the world are just going to roll over and give Trump what he wants?
Yep. They don't have any choice. They are going to get frozen out of our markets if they don't make concessions. You are acting like they can just flip us the bird and go sell all that stuff they're geared to make for us to someone else. (news flash: they can't).
Come on, when backed into a corner your response is "Oh well, we need them give him what he wants?"
Again. Explain what their options are. (they don't have any good ones, and the ones your complaints presume they will make are among the worst available to them).
For how long do they have no choice? How do they react to having no choice? This is not aimed at one Nation, like sanctions. This is across the board.
The cheapest, least cost, least damage option they have to save as many jobs as they can is to cut a deal with us. Picking up their toys & going home = instant recession for THEM.
Come on, you are former CIA. You guys don't think about scenarios through to an end game??
I do. You don't. In fairness, neither do any of the loudest critics of Trump's trade policies.
Trump didn't do this in a win-win how can we make this better for both sides, he did it as a F-you, give me what I want or else...
What we have now is most certainly not a win-win. And if we let it continue, it will be bad for them as well as us. At. Some. Point. the trade deficit house of cards will collapse and everyone will be poorer.
Come on CIA, how do National leaders react to that situation?
They try to salvage as many exports/jobs as they can.
They try to offer things that will placate us. Paying for the cost of what we're doing to Yemen would be a very good start, for example.
Gladly we want to make Trump happy? Appeasement? investigate options, create alliances and then move away from that group? Or worse? We are talking most of the world, not just one Nation.
Geez you are emoting here. We're not talking about most of the world. THe problem we're trying to sovle involves a dozen nations or so with whom we have the lion's share of our trade deficit.
You are like those snowflakes screaming at the sky rather than thinking this thru. We are in a very commanding position. WE have the trade deficit. THEY depend on us buying their stuff. If we don't, THEY go into severe recession, in some cases economic collapse....long before we do. Those elected officials we're negotiating with don't want to lose an election because they waited too long to cut a deal with us and forced their economies into recession. We have the resources and skills to make almost everything we import. It is madness to continue running these kinds of trade deficits, selling equities in our real estate, equities, and sovereign debt to finance our consumption. We did it mostly for THEM....to build relationships to help us all win the Cold War. And it worked! Now is not the time to continue sweetheart deals that fostered wildly unbalanced trade relationships. Now is the time to use our substantial leverage to force a level playing field.
I'm not a critic of globalism per se. I have often pointed out its benefits....why we did it....why it was in our interest to do so. AND IT WORKED! I have also pointed the costs of globalism, why it is madness to continue incurring its costs when we no longer have any need to do so. It is long past time to start making things again. We are cutting the cord with globalism because we have to. We cannot sustain it. The textbooks literally say "export-led growth is the only sustainable growth." And we do NOT have export led growth. Us buying their TVs and them buying our paper is not trade. That is us rent seeking our way to disaster. China wants to subsidize steel? Fine. We buy it and make ships to sell to China. THAT is trade. (but that is a far cry from what is happening.)
Two things. First, export led growth is the path of under-developed economies.
Indeed. Look how fast it built China! Good news is, export led growth has positive impacts no matter how developed your economy is. (i.e. why are you so indifferent to the benefits of trade surpluses? trade deficits are not morally superior, are they? surely you don't mean to suggest there is absolutely no way now how that we could ever run a trade surplus again.?
We are a country so large, productive, and capital rich that we are our own greatest customer. Nearly 85% of U.S. GDP comes from domestic consumption and investment.
Food for thought about how relatively unimportant trade is to us. That in turn should prompt questions about how then could tariffs be so harmful, about why we should tolerate any trade deficits at all, much less a structural trade deficit for 50 years.
We don't rely on foreign buyers to sustain our economy, nor do or will we ever need to.
Yes. So why then would we need to rely on foreign suppliers to sustain our economy? (particularly when we run massive deficits to do it which threaten not just our fiscal health but that of our trade partners (who are also allies).) Over and over and over again we see your reflexive assumption that we are doomed to trade deficits no matter what, and it's not that big a deal anyway since trade deficits are good for the body & soul.
Doing so would require us to weaken the dollar and suppress domestic consumption, and that's dangerous to our overall economy.
That's where your analysis runs off the rails. The biggest threat to the value of dollar is trade deficits spinning out of control. At. Some. Point. our allies will be able to buy no more of them. Check the Fed balance sheet. In 17 years it's gone from under $1T to nearly $9T.
UNSUSTAINABLE. (i.e. trade deficits facilitate financing of fiscal deficits.)
Moving away from an unfair global player like China is one thing. Spinning trade deficits as a greater problem than they are is political theater to dupe the American people.
You are correct to note that trade deficits have had (some) positive impacts. What is perplexing is that you are completely blind to the reality that they also have negative impacts. They have hollowed out the middle class, whose grievances have gone unheeded. Until now.....
Second, aside from Mexico, Canada, and the UK, no major trading partner sends more than 25% of its exports to the U.S. In fact, for most, including China, the U.S. accounts for less than 15% of their export markets, reflecting relatively low economic dependence on America.
Thank you for pointing out parts of the solution. None of those nations with small percentages of US exports will have difficulty executing agreements to either purchase more US goods, or investing in more production in the USA (like Reagan forced the Japanese to do in the 80's). Those solutions will be easy. The bigger relationships will be more challenging, but if we can move a lot of the China production to Mexico and Canada, then reducing the percentages on their surplus with us will not be painful at all. Mex/Can will get a smaller portion of a much bigger pie and we get a bigger portion of that bigger pie. win/win solution.
I'd like to sell US cars all over Asia. We could export key proprietary components from the USA but assemble them in India, then sell to Thailand, Vietnam, Indonesia, etc...... Even if the US originated content was 10%, it'd be better than what we have now (0%). Those are the kinds of things being discussed as we speak. Countries who run trade surpluses with us are going to be expected to offer deals that will help reduce their surplus. If they do so, we will have incentive to keep aircraft carriers in the area to keep the Chinese at bay, to keep the pirates at bay, to keep the terrorists at bay. We'll even charge them a discounted rate per round for ordnance expended. (remember, trade policy always serves national security policy).
This is not hard to figure out. But you have to quit thinking like a globalist and start figuring out how you are going to bring more and better jobs home to the USA. We have incurred unsustainable debt and endured decades of trade deficits to maintain the current world order. It's not working out well for us. So it's going to change....because it must change. We will not have to work terribly hard to get to a better place, so long as we make it abundantly clear that we are DONE with the status quo and new arrangements need to be made forthwith.
It's fascinating how confidently you argue that trade deficits are a sign of economic weakness, while pointing to China's export led growth as something to consider, never mind that China's position is now unraveling precisely because it lacks strong internal demand, capital access, and consumer mobility. It built China because China was a low income country with cheap labor, weak currency, and limited domestic demand, and now their export dependence has turned into a vulnerability, as it has in Germany and several European and Asian economies. Meanwhile, the U.S. with a $29 trillion economy powered 85% by domestic consumption and investment has been running trade deficits for decades and leading the world in GDP, innovation, and capital inflows. Why is that such a problem vs a feature of our unique economic position?
But your spin attempts are creating logic conflicts. You can't simultaneously say trade is unimportant to our economy (because it's a small share of GDP) and then turn around and act like the trade deficit is an existential crisis. If trade isn't systemically central to our economic engine, then a deficit is not a system destroying problem. That contradiction alone undermines your entire framework. Not to mention defeating the idea that tariffs could replace income tax.
And as if to drive home the conflicted reality, your claim that tariffs aren't damaging because trade is small ignores a fundamental point, even small percentages can carry disproportionate effects in highly integrated supply chains. Tariffs don't just hurt trade, they raise input costs for U.S. businesses, reduce competitiveness, and push inflationary pressure onto consumers. The inflation risk isn't in the macro size of trade, it's in the structure (integration) of production.
You say we shouldn't rely on foreign suppliers, which in some areas we are completely in agreement on reducing it. However we don't have scalable domestic alternatives for many of these goods and materials. And we never will, at least not in labor intensive industries like textiles or low margin electronics where we can't compete without massive public subsidies. Not to mention, in order to expand in the industries we need to for strategic reasons, (minerals, coal, steel, energy,) we need a deregulation renaissance to even think about it, and an educational and skills overhaul to execute. But that's being ignored in favor of a chaotic trade war. It ignores both labor realities and capital efficiency. The U.S. doesn't need to build everything to benefit, we already extract value through advanced production, financing, services, intellectual property, and being the global hub of consumption. It's how we've built our advantage. Not to mention we do a lot of high value manufacturing here.
And to muddy this debate even further, you continue to lean into one of the biggest fallacies by grossly overstating the relationship between the Fed balance sheet and trade deficits. Our fiscal deficit is a
domestic spending problem, not a function of trade. I keep pointing this out, but it's not computing with you. Blaming trade deficits for debt is like blaming your grocery store for your credit card bill. The real issue is entitlement spending growth and tax base stagnation. And frankly, it's dishonest to use trade deficits as a stand in for the political unwillingness to tackle structural fiscal reform. You'll notice I don't argue anywhere against DOGE efforts, even if some methods have been radical. The reason is because I do think a sledgehammer approach is required to address this real issue. THAT IS A COMPLETELY DIFFERENT ISSUE FROM TRADE. In fact I keep pushing to see if we'll ever have the will to address Social Security and Medicare at a structural level.
Your quip that this is "not hard to figure out" underlies the oversimplification of a complex global economy that you and this administration keep stumbling over. And their back and forth inconsistent actions and rhetoric reflect it. The result is this warped model relying on coercion. The U.S. will simply demand better terms, companies will just reshuffle supply chains, other countries will bend, and somehow Americans will get more jobs, lower prices, and stronger security. That's not a strategy, it's wish casting. At best we'll likely get some lower tariffs on our goods to other countries, which as a believer in trade will happily applaud. We might get some strategic investment too (again hooray!). But let's be honest, that is nothing close to the objectives outlined in the political rhetoric, or even in your own evolution of spin. And Apple moving production from China to India doesn't validate Trump's tariffs. It validates diversification and risk management in global business, not reshoring.
Finally, this idea that we must "quit thinking like globalists" is just sloganism. It's because of our global integration that we've built the most powerful economy on Earth. Unraveling that based on a romanticized view of mercantilist era balanced trade and national "hard reset" rhetoric isn't just economically reckless, it's strategically backwards. We don't need to burn down the house to renovate a room. Strategic reform, investment in high-skill capacity, and domestic competitiveness will take us further than any tariff bludgeon ever will.
