In lieu of an income tax. Makes sense, eh?Limited IQ Redneck in PU said:
To raise money for the government
Limited IQ Redneck in PU said:
To raise money for the government
The honest answer in many circumstances? We'd dominate their market.KaiBear said:Limited IQ Redneck in PU said:
When we put a tariff on avocados from Mexico who pays it?
Where does the money go?
1. The importer pays it and raises prices . Of course he raises prices. American consumers wind up paying more.
2. Collected tariff money goes straight to the government. That is a tax isnt it?
3. Now citizens are faced with the choice of paying more for the imported avacados or buying the inferior American avacados . The American avacado growers can stay in business selling their avacados. No reason to improve theirproduct.
So what part do you disagree with?
It's a tax on American consumers.
Lack of competition discourages improvement.
Don't believe me read the Reagan quotes and the Fox news report by BB.
If tariffs are horrible to citizens….why do so many countries utilize them against the United States ?
Then why should we not give them the same treatment they give us ?ATL Bear said:The honest answer in many circumstances? We'd dominate their market.KaiBear said:Limited IQ Redneck in PU said:
When we put a tariff on avocados from Mexico who pays it?
Where does the money go?
1. The importer pays it and raises prices . Of course he raises prices. American consumers wind up paying more.
2. Collected tariff money goes straight to the government. That is a tax isnt it?
3. Now citizens are faced with the choice of paying more for the imported avacados or buying the inferior American avacados . The American avacado growers can stay in business selling their avacados. No reason to improve theirproduct.
So what part do you disagree with?
It's a tax on American consumers.
Lack of competition discourages improvement.
Don't believe me read the Reagan quotes and the Fox news report by BB.
If tariffs are horrible to citizens….why do so many countries utilize them against the United States ?
Markets are an important way to look at the issue. Equally important are the JOBS at stake. When items are produced here rather than imported, we gain manufacturing jobs, which are subject to payroll taxes. Imported items are not subject to payroll taxes, or corporate income taxes, or domestic regulatory burdens. etc......and often come with support of subsidies from the exporting country. Tariffs are the most effective way to offset that dynamic. That's why so many countries use them = to protect domestic jobs in key industries.KaiBear said:Then why should we not give them the same treatment they give us ?ATL Bear said:The honest answer in many circumstances? We'd dominate their market.KaiBear said:Limited IQ Redneck in PU said:
When we put a tariff on avocados from Mexico who pays it?
Where does the money go?
1. The importer pays it and raises prices . Of course he raises prices. American consumers wind up paying more.
2. Collected tariff money goes straight to the government. That is a tax isnt it?
3. Now citizens are faced with the choice of paying more for the imported avacados or buying the inferior American avacados . The American avacado growers can stay in business selling their avacados. No reason to improve theirproduct.
So what part do you disagree with?
It's a tax on American consumers.
Lack of competition discourages improvement.
Don't believe me read the Reagan quotes and the Fox news report by BB.
If tariffs are horrible to citizens….why do so many countries utilize them against the United States ?
Don't our markets deserve similar protections ?
Wake up, buddy. Tariffs are almost exclusively about jobs. Always have been. Always will be.Limited IQ Redneck in PU said:
So now we need tariffs to protect jobs? Jobs become obsolete as things change. Should society have to pay extra to prevent job change or should the workers adjust to the market? Whens the last time a door to door salesman rang your bell? Should we raise the prices until going door to door is profitable again?
Limited IQ Redneck in PU said:
It's a tax for American consumers. it's great for the unions. It's a loss of freedom.
Do you overpay youer taxes each year or do eveything you =can to pay as little as possible and not get in trouble?TinFoilHatPreacherBear said:Limited IQ Redneck in PU said:
It's a tax for American consumers. it's great for the unions. It's a loss of freedom.
A healthy middle class is beneficial to communities and the country at large. Working towards fair trade is long term beneficial for the country.
LOL like those other countries don't have union bosses, over-paid labor, bloated federal budgets, and incompetence throughout their private and public sectors? If you like those places so much, why don't you go live there and save the freight & tariff charges? (oh, wait, you'll pay more for those things over there since they aren't receiving the subsidies they do for export.....you'll pay even more in taxes (tariffs & otherwise))....Limited IQ Redneck in PU said:
I have said many times that tariffs are a federal tax on American consumers that try to force Americans to buy inferior products at inflated prices.
The inflated prices protect the union bosses and allow overpayment to underskilled or incompetent workers.
I have had this stance for years. Glad you woke up. (lol).
I say people that favor tariffs should just send in above their tax burden and when they "buy American" fpr patriotic purposes they include a tip for the union bosses.
That way those of us that want the freedom to make our own choices are happy and those that want to help out unions are happy. Win/win.
National security ALWAYS drives trade policy. That is particularly true for globalism. We did not engage in it for the reasons its supporters today cite (cheap goods for American consumers). We did it to build a Cold War alliance to stop the Soviet Union. It worked. But the consequence was that a substantial percentage of the alliance's manufacturing base slowly transitioned from the USA to our allies. The fact that dynamic happened is not the problem. The problem is that it went too far. We let too much critical manufacturing base get away. And for two decades we failed to summon the courage to treat the bigger-clinger globalists like the total nincompoops they were and move to a more balanced model. Finally, the adults are in charge.ATL Bear said:Again, we still lead in advanced manufacturing, particularly in defense. But I'm fine with strategic efforts to expand our defense support manufacturing. If we need more tank and artillery production domestically, support/subsidize tank and artillery production including up stream parts.whiterock said:yes, he is. The professors will tell you that if those countries want to sell their goods at a discount, we should take advantage of it. And when it comes to the narrow question of wealth creation, they are absolutely correct. But it does no good to create wealth if you cannot defend it.Robert Wilson said:Limited IQ Redneck in PU said:
I have explained 100 times. Apparently I am a dumbass for agreeing with Reagan. A tariff is just a tax to manipulate what we buy or can afford.. Harley Davidson almost went bankrupt. To protect them a special tariff waa put on all motorcycles over 750cc. They tried to make big Honda Yamaha etc big bikes more expensive so people would buy HD.
This helped HD sell more bikes. It hurt the consumer. Why can't consumers buy the product they choose at market value? This tariff only helped the iHD union workers.
A tariff is a tax. Instead of supporting over priced inferior products let Americans choose for themselves.
These people that support tariffs just just overpay. If you feel sorry for a company just send them a little money. Think of it as a personal tariff to help America.
So you are happy with other countries highly manipulating their markets against US goods?
We are not the arsenal of the world any more.
China is. (thanks to it having 12x the steel production capacity we do).
And if we let that go unaddressed, China, orany other mercantile power or group of powers, can shut us down. They can force us to sue for peace without ever landing a single soldier on our soil.
We are closer to our Trafalgar moment than at any time in my life. If we loose our fleets, we cannot replace them. And we have the globalists like LIQR to thank for that. Mahan would be apoplectic at the situation we're in.
Not viable. You must have peacetime manufacturing to mobilize for war. We did not have standing tank factories to build those thousands of Sherman tanks we shipped all over the world to our armies and others. Ford built them on auto lines. GMC built them on auto lines. Pullman Rail built them on locomotive lines. Pacific Car & Foundry built them on commercial truck lines. PSC built them on rail car lines. Montreal Locomotive Works. Chrysler. Same situation on aircraft. Commercial shipyards. People never & since in the military industry were big players. You have to have the infrastructure to mobilize. Right now, we don't (not because we listened to the globalists, but because we listened to the globalists for too long).
Don't try and prop up failing U.S. companies in the auto and steel industry with tariffs because you think they are relevant to that point. Let's stop thinking we will be stronger by being more European. Quite the opposite. Let's stick to being innovative and efficient.
Boy that sounds nice. Reality is, everyone else who can build the manufacturing base to mobilize armies will do so. Particularly those who are intent on challenging us. If we don't respond, we lose. Europe is hardly the answer here. They've done what you suggested and are now faced with guns or butter dilemmas than we do.
BTW, if it matters to anyone we have Most Favored Nation status with the EU, which means we have about an average weighted tariff of 4-6% across all products. That was of course until Trump started the trade war and that's being upped now. This blanket tariff strategy was not a good one. People seem to be enamored with tariffs as some magic panacea of jobs and industry. It isn't. But if you're going to do it, at least be targeted and strategic, not this chaotic insanity we have currently.
That's ideology (globalism) talking. Reciprocal tariffs are always a good idea.
Half-correct. One of the benefits of globalism is that it built destroyed and developing economies into peer economic competitors.......competitors who no longer have broad, substantial inherent cost advantages over US producers. What they do have remaining, though, is a paid-for supply chain. Those factories will keep producing until maintenance costs become unsustainable. Then they will close. Just like what happened in the Rust Belt. China is already there. They are living on the factories they have. Few new ones will be built with foreign money. Future investment, particularly foreign investment, will seek better alternatives.ATL Bear said:These tariffs and customs duties are minuscule. This is where these debates get weird. For the vast majority of products, these tariffs are minimal and even if we matched them are easily absorbable. Not to mention, and the bigger point, they aren't anywhere close to something that will materially shift global supply chains. In fact, most companies will seek an even cheaper source to offset the arbitrary increased cost.Robert Wilson said:ATL Bear said:Japan doesn't charge tariffs on its cars produced in Japan, so I'm not sure what you're saying in your first sentence.Robert Wilson said:ATL Bear said:Why is a Frenchman paying more for an American car and an American paying less for a Japanese car like stealing someone's lunch money? How would making that Japanese car more expensive be better for the American?Robert Wilson said:That's just not true. If we are buying cars from Japan, and Japan is making those cars from materials upon which Japan places a tariff, then we are paying the Japanese tariffs.Limited IQ Redneck in PU said:We can only control ourselves.Robert Wilson said:You would think all of the supply chain issues that we had during covid would've brought more people around on the idea that we should onshore significantly more manufacturing.whiterock said:yes, he is. The professors will tell you that if those countries want to sell their goods at a discount, we should take advantage of it. And when it comes to the narrow question of wealth creation, they are absolutely correct. But it does no good to create wealth if you cannot defend it.Robert Wilson said:Limited IQ Redneck in PU said:
I have explained 100 times. Apparently I am a dumbass for agreeing with Reagan. A tariff is just a tax to manipulate what we buy or can afford.. Harley Davidson almost went bankrupt. To protect them a special tariff waa put on all motorcycles over 750cc. They tried to make big Honda Yamaha etc big bikes more expensive so people would buy HD.
This helped HD sell more bikes. It hurt the consumer. Why can't consumers buy the product they choose at market value? This tariff only helped the iHD union workers.
A tariff is a tax. Instead of supporting over priced inferior products let Americans choose for themselves.
These people that support tariffs just just overpay. If you feel sorry for a company just send them a little money. Think of it as a personal tariff to help America.
So you are happy with other countries highly manipulating their markets against US goods?
We are not the arsenal of the world any more.
China is. (thanks to it having 12x the steel production capacity we do).
And if we let that go unaddressed, China, orany other mercantile power or group of powers, can shut us down. They can force us to sue for peace without ever landing a single soldier on our soil.
We are closer to our Trafalgar moment than at any time in my life. If we loose our fleets, we cannot replace them. And we have the globalists like LIQR to thank for that. Mahan would be apoplectic at the situation we're in.
Does that make prices go up? Yes. Does it create safer supply chains and blue collar jobs? Yes.
That said, I'm all for free trade. But allowing one-sided tariffs is not free trade.
If we enact reciprocal tariffs, after a period of "trade war 'kerfuffle and hardship, likely everyone decreases tariffs. Makes no sense to allow other countries to tariff their imports and expect their exports to be tariff free. That's like letting a bully take your lunch money every day.
Our consumers are paying tariffs to Japan, in the price of the Japanese car. And it's not reciprocal. That sort of thing is happening all the time, embedded in all sorts of goods we buy from other countries.
That ignores the direct excise taxes, vats, or tariffs that Japan puts on any vehicles or materials imported from the US. Those of course hurt us on the sell side. I understand for many of you that is a feature and not a bug. "Learn to code" and such, pre AI at least. We will probably need a new saying.
I think the likely eventual result of a temporary trade war here is lower excise taxes across-the-board, not higher, and in a way that ultimately makes things more equitable. Everyone can blow smoke, but ultimately, they all have to deal with us.
To the extent it does not work out that way, if we actually use the revenue to decrease the income tax burden as Trump has espoused, then we are shifting from income tax to a virtual sales tax while lining out our competitive level with respect to the rest of the globe. I would view that as a win-win, higher prices be damned.
Whatever tariffs Japan charges on the materials used to make those cars is inevitably passed on to our consumers.
Remember:ScottS said:
Getting close to this date.
Just remember - this means the American consumer, in a time where inflation is already running rampant - is about to start paying significantly more for electronics, appliances and automobiles.whiterock said:Easy. Threaten trade barriers to force businesses to relocate a greater percentage of their manufacturing for US supply chains inside the USA.ScottS said:
Getting close to this date.
whiterock said:Remember:ScottS said:
Getting close to this date.
C + I + G + T = GDP
Where:
C = Consumer pending (private sector)
I = Investment (private sector)
G = Government Spending
T = Trade balance (surplus will be a positive number; deficits will be a negative number).
Trump is going for $1T in spending reductions in "G" via elimination of waste & fraud. They are on pace to hit it, but that will be a $1T hit to "G" in the GDP formula = guaranteed recession if nothing else changes. So how to offset?
Easy. Threaten trade barriers to force businesses to relocate a greater percentage of their manufacturing for US supply chains inside the USA. And we've already reached $1T in announced investments that were previously planned to be built in a 3rd country. So we've already gotten the offset, albeit some of that investment will not hit the same reporting period (FY25) as the spending cuts. (ergo you go for even more investment......)
The Fed has implicitly acknowledged that dynamic in its calculations in recent comments of Fed Chair that they expected US GDP to grow 1.7% this year (as noted here previously). ZERO chance there could be any growth in GDP at all if neither "C" nor "I" increased by amounts greater than $1T.
Also: Keep in mind the limits of "damage" tariffs can do to prices. Only 15% of US GDP is trade oriented (and we run a deficit on it). So a 100% tariff on ALL imported goods would have a one-time inflationary effect of 15%. We are nowhere near that number. We are talking 25% max levels on selected industries. So overall increases in costs to the economy as a whole might not reach a single percentage points.
The pursuit of a positive trade balance is obvious. It turns "T" into a positive number. That's why all the textbooks say "the only sustainable growth is export-led growth."
Trump's plan is working splendidly.
Give it some time to play out......
KaiBear said:whiterock said:Remember:ScottS said:
Getting close to this date.
C + I + G + T = GDP
Where:
C = Consumer pending (private sector)
I = Investment (private sector)
G = Government Spending
T = Trade balance (surplus will be a positive number; deficits will be a negative number).
Trump is going for $1T in spending reductions in "G" via elimination of waste & fraud. They are on pace to hit it, but that will be a $1T hit to "G" in the GDP formula = guaranteed recession if nothing else changes. So how to offset?
Easy. Threaten trade barriers to force businesses to relocate a greater percentage of their manufacturing for US supply chains inside the USA. And we've already reached $1T in announced investments that were previously planned to be built in a 3rd country. So we've already gotten the offset, albeit some of that investment will not hit the same reporting period (FY25) as the spending cuts. (ergo you go for even more investment......)
The Fed has implicitly acknowledged that dynamic in its calculations in recent comments of Fed Chair that they expected US GDP to grow 1.7% this year (as noted here previously). ZERO chance there could be any growth in GDP at all if neither "C" nor "I" increased by amounts greater than $1T.
Also: Keep in mind the limits of "damage" tariffs can do to prices. Only 15% of US GDP is trade oriented (and we run a deficit on it). So a 100% tariff on ALL imported goods would have a one-time inflationary effect of 15%. We are nowhere near that number. We are talking 25% max levels on selected industries. So overall increases in costs to the economy as a whole might not reach a single percentage points.
The pursuit of a positive trade balance is obvious. It turns "T" into a positive number. That's why all the textbooks say "the only sustainable growth is export-led growth."
Trump's plan is working splendidly.
Give it some time to play out......
Trump understands the game.
Mothra said:Just remember - this means the American consumer, in a time where inflation is already running rampant - is about to start paying significantly more for electronics, appliances and automobiles.whiterock said:Easy. Threaten trade barriers to force businesses to relocate a greater percentage of their manufacturing for US supply chains inside the USA.ScottS said:
Getting close to this date.
The repercussions of some of this doesn't seem to have been fully thought through.
Don't disagree, but the precedent is set, and it's going to be difficult to justify to consumers that your iPhone is now going to double in price.Redbrickbear said:Mothra said:Just remember - this means the American consumer, in a time where inflation is already running rampant - is about to start paying significantly more for electronics, appliances and automobiles.whiterock said:Easy. Threaten trade barriers to force businesses to relocate a greater percentage of their manufacturing for US supply chains inside the USA.ScottS said:
Getting close to this date.
The repercussions of some of this doesn't seem to have been fully thought through.
How did America become the greatest military and economic super power on earth without easy access to cheap flat screens made by semi-slave labor?
[Treasury Secretary Scott Bessent argues that affordability isn't just about cheap imports it's about ensuring Americans can build real financial security.
"Access to cheap goods is not the essence of the American dream," Bessent said during a speech at the Economic Club of New York on March 6. "The American Dream is rooted in the concept that any citizen can achieve prosperity, upward mobility, and economic security."]
Mothra said:Don't disagree, but the precedent is set, and it's going to be difficult to justify to consumers that your iPhone is now going to double in price.Redbrickbear said:Mothra said:Just remember - this means the American consumer, in a time where inflation is already running rampant - is about to start paying significantly more for electronics, appliances and automobiles.whiterock said:Easy. Threaten trade barriers to force businesses to relocate a greater percentage of their manufacturing for US supply chains inside the USA.ScottS said:
Getting close to this date.
The repercussions of some of this doesn't seem to have been fully thought through.
How did America become the greatest military and economic super power on earth without easy access to cheap flat screens made by semi-slave labor?
[Treasury Secretary Scott Bessent argues that affordability isn't just about cheap imports it's about ensuring Americans can build real financial security.
"Access to cheap goods is not the essence of the American dream," Bessent said during a speech at the Economic Club of New York on March 6. "The American Dream is rooted in the concept that any citizen can achieve prosperity, upward mobility, and economic security."]
All this does is put power back into the hands of unions, who will screw American concumers with an over-priced and ****ty product.
Just because it's a right to work state doesn't mean the employees aren't unionized. For example, all of the employees at the GM Factory in Arlington, Texas are members of the UAW. Every last one.Redbrickbear said:Mothra said:Don't disagree, but the precedent is set, and it's going to be difficult to justify to consumers that your iPhone is now going to double in price.Redbrickbear said:Mothra said:Just remember - this means the American consumer, in a time where inflation is already running rampant - is about to start paying significantly more for electronics, appliances and automobiles.whiterock said:Easy. Threaten trade barriers to force businesses to relocate a greater percentage of their manufacturing for US supply chains inside the USA.ScottS said:
Getting close to this date.
The repercussions of some of this doesn't seem to have been fully thought through.
How did America become the greatest military and economic super power on earth without easy access to cheap flat screens made by semi-slave labor?
[Treasury Secretary Scott Bessent argues that affordability isn't just about cheap imports it's about ensuring Americans can build real financial security.
"Access to cheap goods is not the essence of the American dream," Bessent said during a speech at the Economic Club of New York on March 6. "The American Dream is rooted in the concept that any citizen can achieve prosperity, upward mobility, and economic security."]
All this does is put power back into the hands of unions, who will screw American concumers with an over-priced and ****ty product.
Well...better our manufacturing and consumer goods be under the control of American based Unions than Chinese Communist party psychopaths
At the same time there is a very good chance that does not happen....companies in America and other foreign companies that come here will compete for market share and efficiency
Not to mention a lot of US States are right to work and not controlled by Unions
[As of 2024, 26 U.S. states have "right-to-work" laws, which prohibit requiring employees to join a union or pay union dues as a condition of employment]
Mothra said:Just because it's a right to work state doesn't mean the employees aren't unionized. For example, all of the employees at the GM Factory in Arlington, Texas are members of the UAW. Every last one.Redbrickbear said:Mothra said:Don't disagree, but the precedent is set, and it's going to be difficult to justify to consumers that your iPhone is now going to double in price.Redbrickbear said:Mothra said:Just remember - this means the American consumer, in a time where inflation is already running rampant - is about to start paying significantly more for electronics, appliances and automobiles.whiterock said:Easy. Threaten trade barriers to force businesses to relocate a greater percentage of their manufacturing for US supply chains inside the USA.ScottS said:
Getting close to this date.
The repercussions of some of this doesn't seem to have been fully thought through.
How did America become the greatest military and economic super power on earth without easy access to cheap flat screens made by semi-slave labor?
[Treasury Secretary Scott Bessent argues that affordability isn't just about cheap imports it's about ensuring Americans can build real financial security.
"Access to cheap goods is not the essence of the American dream," Bessent said during a speech at the Economic Club of New York on March 6. "The American Dream is rooted in the concept that any citizen can achieve prosperity, upward mobility, and economic security."]
All this does is put power back into the hands of unions, who will screw American concumers with an over-priced and ****ty product.
Well...better our manufacturing and consumer goods be under the control of American based Unions than Chinese Communist party psychopaths
At the same time there is a very good chance that does not happen....companies in America and other foreign companies that come here will compete for market share and efficiency
Not to mention a lot of US States are right to work and not controlled by Unions
[As of 2024, 26 U.S. states have "right-to-work" laws, which prohibit requiring employees to join a union or pay union dues as a condition of employment]
Don't disagree. But all of the autoworkers are. That's the point. You're not building cheaper cars here than you are in Detroit. So the fact that we are a right to work state won't make us more competitive in that industry at least.Redbrickbear said:Mothra said:Just because it's a right to work state doesn't mean the employees aren't unionized. For example, all of the employees at the GM Factory in Arlington, Texas are members of the UAW. Every last one.Redbrickbear said:Mothra said:Don't disagree, but the precedent is set, and it's going to be difficult to justify to consumers that your iPhone is now going to double in price.Redbrickbear said:Mothra said:Just remember - this means the American consumer, in a time where inflation is already running rampant - is about to start paying significantly more for electronics, appliances and automobiles.whiterock said:Easy. Threaten trade barriers to force businesses to relocate a greater percentage of their manufacturing for US supply chains inside the USA.ScottS said:
Getting close to this date.
The repercussions of some of this doesn't seem to have been fully thought through.
How did America become the greatest military and economic super power on earth without easy access to cheap flat screens made by semi-slave labor?
[Treasury Secretary Scott Bessent argues that affordability isn't just about cheap imports it's about ensuring Americans can build real financial security.
"Access to cheap goods is not the essence of the American dream," Bessent said during a speech at the Economic Club of New York on March 6. "The American Dream is rooted in the concept that any citizen can achieve prosperity, upward mobility, and economic security."]
All this does is put power back into the hands of unions, who will screw American concumers with an over-priced and ****ty product.
Well...better our manufacturing and consumer goods be under the control of American based Unions than Chinese Communist party psychopaths
At the same time there is a very good chance that does not happen....companies in America and other foreign companies that come here will compete for market share and efficiency
Not to mention a lot of US States are right to work and not controlled by Unions
[As of 2024, 26 U.S. states have "right-to-work" laws, which prohibit requiring employees to join a union or pay union dues as a condition of employment]
But most workers in Texas are not union zed at all....nor will they be
[In 2023, approximately 4.5% of the Texas workforce, or about 586,000 workers, were union members]
Redbrickbear said:KaiBear said:whiterock said:Remember:ScottS said:
Getting close to this date.
C + I + G + T = GDP
Where:
C = Consumer pending (private sector)
I = Investment (private sector)
G = Government Spending
T = Trade balance (surplus will be a positive number; deficits will be a negative number).
Trump is going for $1T in spending reductions in "G" via elimination of waste & fraud. They are on pace to hit it, but that will be a $1T hit to "G" in the GDP formula = guaranteed recession if nothing else changes. So how to offset?
Easy. Threaten trade barriers to force businesses to relocate a greater percentage of their manufacturing for US supply chains inside the USA. And we've already reached $1T in announced investments that were previously planned to be built in a 3rd country. So we've already gotten the offset, albeit some of that investment will not hit the same reporting period (FY25) as the spending cuts. (ergo you go for even more investment......)
The Fed has implicitly acknowledged that dynamic in its calculations in recent comments of Fed Chair that they expected US GDP to grow 1.7% this year (as noted here previously). ZERO chance there could be any growth in GDP at all if neither "C" nor "I" increased by amounts greater than $1T.
Also: Keep in mind the limits of "damage" tariffs can do to prices. Only 15% of US GDP is trade oriented (and we run a deficit on it). So a 100% tariff on ALL imported goods would have a one-time inflationary effect of 15%. We are nowhere near that number. We are talking 25% max levels on selected industries. So overall increases in costs to the economy as a whole might not reach a single percentage points.
The pursuit of a positive trade balance is obvious. It turns "T" into a positive number. That's why all the textbooks say "the only sustainable growth is export-led growth."
Trump's plan is working splendidly.
Give it some time to play out......
Trump understands the game.
But the college educated people on this forum (and in the Media) don't
This is where the shortcomings of being classroom educated vs actual global economic participation decouples. It's why governments fail to be good economic stewards, and you seem to be following that path of bureaucratic administrative manipulation. It's curious, or even laughable, that you're leaning on the GDP equation C + I + G + (X - M), but let's not pretend that this formula is a strategic playbook. It's a descriptive accounting identity, not a prescription for how to grow an economy. Your assumption that we can surgically reduce $1 trillion from government spending (still to be defined no less) and simply plug that hole with tariff-induced private investment ignores the quality, timing, and durability of each variable.whiterock said:Remember:ScottS said:
Getting close to this date.
C + I + G + T = GDP
Where:
C = Consumer pending (private sector)
I = Investment (private sector)
G = Government Spending
T = Trade balance (surplus will be a positive number; deficits will be a negative number).
Trump is going for $1T in spending reductions in "G" via elimination of waste & fraud. They are on pace to hit it, but that will be a $1T hit to "G" in the GDP formula = guaranteed recession if nothing else changes. So how to offset?
Easy. Threaten trade barriers to force businesses to relocate a greater percentage of their manufacturing for US supply chains inside the USA. And we've already reached $1T in announced investments that were previously planned to be built in a 3rd country. So we've already gotten the offset, albeit some of that investment will not hit the same reporting period (FY25) as the spending cuts. (ergo you go for even more investment......)
The Fed has implicitly acknowledged that dynamic in its calculations in recent comments of Fed Chair that they expected US GDP to grow 1.7% this year (as noted here previously). ZERO chance there could be any growth in GDP at all if neither "C" nor "I" increased by amounts greater than $1T.
Also: Keep in mind the limits of "damage" tariffs can do to prices. Only 15% of US GDP is trade oriented (and we run a deficit on it). So a 100% tariff on ALL imported goods would have a one-time inflationary effect of 15%. We are nowhere near that number. We are talking 25% max levels on selected industries. So overall increases in costs to the economy as a whole might not reach a single percentage points.
The pursuit of a positive trade balance is obvious. It turns "T" into a positive number. That's why all the textbooks say "the only sustainable growth is export-led growth."
Trump's plan is working splendidly.
Give it some time to play out......
a few of qualifications are in order. For startersMothra said:Just remember - this means the American consumer, in a time where inflation is already running rampant - is about to start paying significantly more for electronics, appliances and automobiles.whiterock said:Easy. Threaten trade barriers to force businesses to relocate a greater percentage of their manufacturing for US supply chains inside the USA.ScottS said:
-`5 Getting close to this date.
The repercussions of some of this doesn't seem to have been fully thought through.
The automobile tariff is not a reciprocal tariff. It's a tariff designed to bring automobile manufacturing back to the US, as Trump himself said. Moreover, my understanding of the tariff is that it applies to ANY auto makers that are making cars outside the US. So Stellantis, which makes more cars outside of the US than Honda, will also be hit hard, unless Trump makes an exception.whiterock said:a few of qualifications are in order. For startersMothra said:Just remember - this means the American consumer, in a time where inflation is already running rampant - is about to start paying significantly more for electronics, appliances and automobiles.whiterock said:Easy. Threaten trade barriers to force businesses to relocate a greater percentage of their manufacturing for US supply chains inside the USA.ScottS said:
-`5 Getting close to this date.
The repercussions of some of this doesn't seem to have been fully thought through.
Those things are durable goods with years of lifespan. So perhaps the cost hits the shelf immediately, but only for the consumers in the market at any given time. A grocer sees his customer list every week; an appliance salesman sees his customer list ever 10-15 years. Sure, the customers in the market feel the pain, but they're probably less than 10% of the customers (i.e. voters). (which means lots of time for the trade war to end, economy to bounce back, etc.....)
More significant, look at the list of countries subject to the targeted tariffs. Only one figures prominently in those imports. It's a large share, but declining... Sure, the reciprocal tariffs loom on everyone, but they go into place where a country has a tariff higher than us on any certain sector. Does anybody think China needs a tariff to protect is manufactures of such things from anyone, much less America?
