By Thomas J. DiLorenzo
The end result will be an even more legalized theft as American producers that use imported parts for their own manufactured products are plundered by tariffs.
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189 sats \ 19 replies \ @Aardvark 15 Mar
So, in the spirit of fairness, we will allow all the other nations to profit from seigniorage by allowing them to take turns printing the world reserve currency?
Oh wait....
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161 sats \ 18 replies \ @Undisciplined OP 15 Mar
Fair, but also Trump isn't the one making them manage their currencies so stupidly that no one wants to use it.
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72 sats \ 13 replies \ @LibertasBR 15 Mar
With the dollar currently being the world's reference currency, Americans never lose the game. In fact, it looks like a debt pit is filling up and everyone is in it. This government only seems to want to free Americans from responsibility before the shit overflows.
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100 sats \ 12 replies \ @Undisciplined OP 15 Mar
We never lose the game, until the end when all the chickens come home to roost.
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0 sats \ 11 replies \ @Solomonsatoshi 15 Mar
Wrong. China has won the trade war.
https://unctad.org/topic/trade-analysis/chart-10-may-2021
China is already and will increasingly denominate trade in Yuan, not USD.
Iran and Russia already sell their oil and gas to China outside of the USD SWIFT hegemony.
USD/USA has maybe 5 years, before collapse and Trump knows it.
Tariffs are a crude but effective but effective means of staving off US insolvency/collapse.
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22 sats \ 10 replies \ @028559d218 16 Mar freebie
How do Tariffs solve US collapse?
They don't increase revenue to the treasury (not really) or not much
They increase costs on US consumers
They result in 'reciprocal tariffs' on the United States from other countries
They encourage other countries to 'sidestep' the dollar and US completely... employing alternatives that can't be 'turned off'
Tariffs encourage other countries to trade with each other more and the United States less. Resulting in fewer dollars held by the "trading partners"
And most importantly, the US 'exports' dollars through a trade surplus, maintaining the dollar as the 'reserve currency.'
Other countries take the dollars and 'buy our bonds' keeping interest rates low.
If the US stops 'exporting dollars' (which the tariffs are designed to do) all of that stops.
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33 sats \ 3 replies \ @Aardvark 15 Mar
America is still directly profiting off of it. So fair is fair.
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63 sats \ 1 reply \ @Undisciplined OP 15 Mar
For the most part, they are allowed to try that, right? And, most large economies are able to transact in whatever currency they want.
It does seem different, since America has no mechanism for setting other nations' tax and regulatory policies.
That said, I think fairness is pretty dumb in situations like this. The relevant criteria is what's best for people. Just because other countries are doing dumb stuff to their economies, doesn't mean we should follow suit.
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30 sats \ 0 replies \ @Aardvark 15 Mar
That was really my main point. There's no such thing as fair in situations like this anyhow.
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0 sats \ 0 replies \ @Solomonsatoshi 15 Mar
America overall pays more for imports and this pushes the allocation of capital to inherently inefficient US based manufacturing.
America loses overall with increased costs and mis-allocation of capital on a massive scale.
The US government enjoys a windfall of revenue, paid for by consumers and businesses who pay more for the goods and services they want or need.
USA becomes less competitive as other nations are not hit by these additional costs and large scale mis-allocation of capital.
This is Trump admitting that USA has lost the trade war and so he wants to rig the game.
It might buy time but its not going to fix the underlying problem.
US economy and empire is corrupt, inefficient, obese, burdened by too many rentseeking clingons and so in structural decline.
Global fiat monetary hegemony created an addict that is beyond recovery.
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23 sats \ 2 replies \ @LibertasBR 15 Mar
I’m not justifying him or saying that this is good, because it is, in fact, theft, as always. I just want to provoke some discussion.
Isn’t his strategy in line with the goal of American reindustrialization, bringing factories back to America?
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0 sats \ 0 replies \ @Solomonsatoshi 15 Mar
The problem is that US and in fact all western manufacturing now faces a more efficient competitor- China.
China can and does minimise input costs to manufacturers by owning and controlling infrastructure and many manufacturing supply chains.
The wests governments have sold off state owned infrastructure and now the dividends that shareholders demand must be paid- while China can supply core infrastructure inputs at cost.
In addition to this the entire Chinese economy is structured consciously and purposely to leverage the advantage China has in terms of scale.
For example- China can build Lithium processing plant for 1/3 the cost western processors can.
Extend this example across the entire productive economy (with varying but consistent degree of advantage in Chinas favour) and tariffs are not going to fix the problem.
All Trumps tariffs do is buy time before the inevitable collapse of the USD.
They do also come with significant pain in terms of consumer and producer costs going up- ie inflation and capital mis-allocation as investing in US industry that is simply and inherently not competitive with Chinese plant is quite explicitly mis-allocation of capital.
These tariffs are from the Keynesian era and they never worked except to distort the signals for capital allocation and to direct capital into irrational purposes.
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0 sats \ 0 replies \ @Undisciplined OP 15 Mar
Yeah, it is. I'm trying to post stuff from different sides of the tariff conversation, because there's more to it than most people acknowledge.
If they follow through on the offsetting IRS tax cuts, then I expect this to be a net positive.
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