alt Hacker NewsThere’s been many people opposed to free trade for decades, on both sides like Pat Buchanan and Bernie Sanders. You can think those guys are incorrect in their analysis, but calling it “mindless” is just ridiculous.
This tariff regime is simply a “minimal viable product” aimed at the idea of reducing structural trade deficits.
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Yes and: IIRC, their intent is to bolster the US dollar as the reserve currency.
Not that I understand it, cuz am noob:
Admin thinks US dollar is too strong. So they want to devalue it. Which will then trigger a sell off of US Treasuries, further devaluing the US dollar.
I have no idea if this is the Admin's actual plan, the merit of such a plan, or if there's any realistic hope for achieving the intended outcome.
If any one can make any of this make sense, please chime in. TIA.
Sanders might impose tariffs, but he would be smart enough to realize that if trade deficits need to be reduced what matters is reducing the deficit on the aggregate trade, not reducing the deficits individually with each trade partner.
Trump is treating each country as a separate issue and wants to reduce the deficits with each of them. That's completely stupid because even if every country got rid of all trade barriers and protectionism there would still be deficits with some countries and surpluses with others because different countries need to import different things.
For example say country A needs some natural resource that they have no domestic supply of, so they import that from country B. A uses that to produce goods for their own use and for export.
Country B's biggest need is some other resource that they lack, so they use the money they get from selling their resource to A to buy the resource they need from C.
In this scenario A runs a trade deficit with B and there is nothing whatsoever wrong with this.
The whole freaking point of money is to make it so you can trade for goods without having to have goods of your own that the other party wants.
In economic terms, its a transfer from consumers of cheap goods to producers.
Just posting something doesn't make it true. Don't be disingenuous by making it seems like Sanders supports this idiotic "plan" just because he spoke out in favor of certain tariffs or against parts of free trade in the past.
In fact he called these tariffs along with Trump's plan to cut taxes on he wealthy an absurd transfer of wealth:
> Trump's absurd idea to replace the income tax with a sales tax on imported goods would be the largest transfer of wealth in U.S. history. If enacted, taxes would go up by over $5,000 a year for a middle class family, while those in the top 0.1% would get a $1.5 million tax break.
https://xcancel.com/BernieSanders/status/1850933809384137106
And Trump's economic plan "insane"
> https://www.nbcnews.com/meet-the-press/video/bernie-sanders-...
Many agree, most polls have Trump far underwater in his handling of the economy.
> Respondents gave Trump poor marks for his handling of the economy, which 37% approved of, with 30% approving of his work to address the high cost of living, an issue that also dogged Biden.
https://www.reuters.com/default/trump-approval-falls-43-lowe...
My theory is that it actually has nothing to do with trade at all--why else would the story changes so much when they are asked to describe the methodology or rationale?
This is how they cut taxes without cutting taxes. They've even said as much: "We'll do this huge tax cut and revenue from tariffs will pay for it." But tariff revenue IS tax. It's just a tax on spending versus income. It's quite clever because a tax on spending disproportionately impacts the poor and the middle class (who spend a much higher percentage of their income).