Now For Some Good News On Trade

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WASHINGTON — Amid President Donald Trump’s trade war with China, nearly two-thirds of Americans say they support free trade with foreign countries, according to the latest national poll from NBC News and the Wall Street Journal.

That represents a new high in the NBC/WSJ survey on this question, and it’s a 7-point increase from the last time it was asked in 2017.  – NBC News, Aug 18th

Make Love, Not Trade Wars

Ever since Trump was elected we have railed on his trade policies and warned how they would send the global economy into a tailspin.

We do hope they strike a deal before July 6th, the date U.S. tariffs on Chinese imports take effect, and same-day China’s retaliatory tariffs are expected to launch.  We are not optimistic, however,  unless the financial markets crater on trade war fears and force the president to cave, and move negotiations to the WTO, where the U.S. will have more leverage to extract concessions from China.

…The administration also fails to understand the overall trade deficit is a function of America’s savings deficit and not the cum sum of trade microaggressions by our trading partners.

The upside to this mess is that Americans will finally realize that trade creates both winners and losers and that the majority of the country is better off with free trade even if it is not perfectly fair and reciprocal.  The “best” policy for the majority is to expand trade and remain engaged with the global economic community but also provide a strong safety net for the losers of free trade.

The slouch toward tribalism will destroy the United States and the global economy.  – GMM, June 2018

The Ultimate Socialism

We are happy to see the American people are good traders, learn from policy mistakes, and know how to cut losses.

We believe that government management of trade through tariffs and protectionism is the ultimate socialism.

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GMM,  May 2019

Others seem to agree,

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Railing against socialism — which in Trump’s mouth is less a specific economic system than an all-purpose epithet — is probably sound campaign strategy for the president. It’s also wildly duplicitous, as his administration’s own attempts to ameliorate the damage of his trade war are themselves the sort of redistribution critics of socialism decry. They are politically convenient redistribution, too, subsidizing Trump-friendly territories at other Americans’ expense.

…Trump’s trade war is doing the opposite of what his stump speech promises. It’s making America more socialist, not less. By upending farmers’ trade relations, he is keeping them from the work they’d like to do. The subsidies are “substantial, but we cannot overstate the dire consequences that farmers and ranchers are facing in relation to lost export markets,” Zippy Duvall of the American Farm Bureau Federation said when the redistribution program was announced. Instead of payouts, Duvall insisted, farmers would prefer an “end to the trade war” and “restor[ed] markets.”  

…The president has demonstrated his utter ignorance of all things trade from the get-go. He demonstrably cannot grasp how trade can be mutually beneficial and seems equally at a loss as to how tariffs actually work. He is constantly self-contradictory, going back and forth on whether trade wars are “easy to win” and vacillating in the span of two sentences on Thursday as to whether his standoff with China should be long or short.

In pairing slams on socialism with this policy of redistribution, he either adds another count of appalling ignorance to that list or engages in a rank and politically convenient hypocrisy. I’m not sure which is worse.
The Week, August 19th

Democrats, are you listening?

Trade can be mutually beneficial and those hurt should not be ignored but be well compensated and retrained if possible.   Python is easy.

Trump has it as ass-backward.  His policy is to restrict trade and compensate those, through transfer payments from consumers or businesses,  who have lost their markets in foreign  retaliation for his tariffs.

Trump Sounds Like He Is Ready To Cave

The President’s rhetoric, albeit ambiguous and equivocal, sounds like he is ready to make some major concessions to China in trade negotiations but you never know with this guy.  He has impulsively backed himself into another corner and will have to go ahead with the tariffs in September lest he looks extremely weak and loses all credibility.

We can’t see the Chinese moving on anything if the new round of tariffs goes ahead at the beginning of the month. What a frickin’ unavoidable mess.

Never forget, at the end of the day, Trump is an economic nationalist über alles and not a free-trader.

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Into the dustbin it shall go.

 

This entry was posted in Trade War, Uncategorized and tagged . Bookmark the permalink.

4 Responses to Now For Some Good News On Trade

  1. John Merrill says:

    How many of those survey respondents have a clue as to what is meant by “free trade?” You’d get roughly the same results if you asked “Are you for or against motherhood?”

  2. Pingback: Roll back: The Verb China Is Looking For | Global Macro Monitor

  3. Pingback: China Still Looking For A RollBack | Global Macro Monitor

  4. Pingback: Welcome To The Forever Trade War | Global Macro Monitor

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