Trump Tariffs started today, Some Countries Caved in early morning.

by liam 95 Replies latest social current

  • Balaamsass2
    Balaamsass2

    ""Those who cannot remember the past are condemned to repeat it" - George Santayana. "

    "The Tariff Act of 1930, also known as the Smoot–Hawley Tariff Act, was a protectionist trade measure signed into law in the United States by President Herbert Hoover on June 17, 1930. Named after its chief congressional sponsors, Senator Reed Smoot and Representative Willis C. Hawley, the act raised tariffs on over 20,000 imported goods in an effort to shield American industries from foreign competition during the onset of the Great Depression, which had started in October 1929.[1]

    Hoover signed the bill against the advice of many senior economists, yielding to pressure from his party and business leaders. Intended to bolster domestic employment and manufacturing, the tariffs instead deepened the Depression because the U.S.'s trading partners retaliated with tariffs of their own, leading to U.S. exports and global trade plummeting. Economists and historians widely regard the act as a policy misstep, and it remains a cautionary example of protectionist policy in modern economic debates.[2] It was followed by more liberal trade agreements, such as the Reciprocal Trade Agreements Act of 1934." https://en.wikipedia.org/wiki/Smoot%E2%80%93Hawley_Tariff_Act

  • Rivergang
    Rivergang
    He has a better way, and it is coming.

    Well that, of course, takes the discussion off in an entirely different direction - and is a dialogue which I would prefer not to engage in! (Not right now, anyway).

    Certainly, mechanisation of industry has always brought with it certain social dislocations. However, in the past, these have been more than offset by its benefits.

    For example, when mechanisation of the textile industry began in the 18th century, traditional crafts such as hand-weaving became obsolete. Persons who previously worked in those now obsolete hand crafts, though, could quickly be retrained as factory workers. The result was a much greater output of textiles, which made clothing much more affordable.

    Another case is the mechanisation of civil engineering activities, which took place between the two world wars. The question was back then raised "You have introduced one bulldozer, which does the work of at least 100 men. What now happens to the other 99 workers?" The answer was "We obtain another 99 bulldozers". Most former labourers could easily be retrained to operate such earthmoving plant as a bulldozer, and the result was a spectacular increase in output. This made possible such activities as the open cut mining of very low-grade mineral deposits. (One example of that being some of the world's largest gold mines, where the ore yields just 0.3 grams of gold per ton. To recover just one ounce of gold, they have to process some 16 tons of ore. A person using hand tools would be there a long, long time trying to win their single ounce of gold!)

    It would have to be admitted, though, that the social problems resulting from the present level of industrial automation are a much harder nut to crack. Not every redundant factory hand has the makings of an IT specialist!

    That being said, you will never, ever stem the tide of progress:

    • In 18th Century England, saboteurs ("Luddites", they were known as) attempted to do that by destroying the new weaving machines.
    • At the start of the railway era, a race was organised between a train and a horse. The horse came out the winner, but the result changed nothing.
    • Similarly, when the first chainsaws were introduced into the timber industry, another race was organised; this time between a chainsaw and a handsaw. The result was an even draw. Set against a log of four feet in diameter, the two-man team with the newfangled chainsaw took just as long as the two men on the end of the handsaw. Again, that result changed nothing in the longer term. The clumsy IEL chainsaw of 1953 was by 1960 superseded by the single-handed McCullough - and crosscut saws disappeared from the shelves of hardware stores.
    • In the district where I grew up, coal mining was once the principal employer. However, that industry was killed off almost entirely because the all-powerful mining union refused to countenance any form of mechanisation. Even by the early 1970s, those mines were still being worked by hand labour. Hardly surprising, then, that they have long since gone the way of the dinosaur!

    Progress will never be halted, but the present unresolved social issues that have resulted could easily leave a person hoping for that man on a white horse to step in and rescue us all!

  • blondie
    blondie

    Thanks, Balaamass2 for posting that about the Smoot-Hawley Tariff Act. Not alive then :) but required study in my econ history class. Seems some missed that event. Doomed to be repeated because people have convenient memories or know little about their own country's history.

  • peacefulpete
    peacefulpete

    I didn't read all that went before on this thread but even before the election there were efforts to educate people about what 'trade deficits' are and what they are not.

    Before I go to the hardware store and buy a new saw, I compare prices, convenience and quality with other stores. I might even factor in my liking the owner or desire to buy local. When I decide where to buy, it is not done with the expectation that that store reciprocate and buy something from me. I make sauerkraut. It's probably not something they want, and even if they did, I might not be the best option to buy from.

    I now have a trade deficit with the hardware store. Did the store rip me off or take advantage of me? No.

    A wealthy man buys more goods than I do. He may not make anything but earns his living as a doctor. has he been taken more advantage of or ripped off more because of his buying what he wants from the best supplier? No.

    In simplest terms, when a wealthy nation has a trade deficit, it is evidence of a mature prospering postindustrial economy, not a crime.

    When America buys luxury vanilla extract from the poor nation of Madagascar, they are not expected to match that purchase in computer tech or soybeans they don't need. They are already competing with Mexico and a dozen other suppliers and working on small margins. Because Madagascar sells us more that the poor country can buy from us, they have been hit with a 47% tariff on their goods. Your vanilla just became even more a luxury and imports from the island are almost certain to fall off dramatically, impoverishing their economy further when their crime was having a less diversified economy and being poor.

    The richest nations of the world all have trade deficits with certain nations and that is normal and healthy free market economics.

    Every nation makes their own policy, some are better than others. Some are based upon ignorance. Usually the damage is limited, but when the largest economy in the world makes dumb policy, the damage can be global.

  • TD
    TD

    A lot would dépend on how one définies "Production Facility" and "Fully Automated"

    The first thing that popped into my head was manufacturing, but production can include a lot of things

  • Riley
  • joey jojo
    joey jojo

    If you are unsure about the 1930 tariff, here's a reminder from Ferris Bueller's Day Off:

    https://youtu.be/uhiCFdWeQfA?feature=shared

  • joey jojo
    joey jojo

    I watched an economist today that estimated it would take 3 years and 30 billion dollars for Apple to bring just 10 % of its manufacturing to the US. If they were made in America, it would triple the price of an iPhone.

    There are good reasons for any country to improve its debt but ignoring trade agreements and pissing off allies and partners - not to mention enemies, probably isn't the best way to earn trust.

  • Rivergang
    Rivergang
    The word "progress" is a relative term,

    I have always understood that term to mean technological advancement - and that is what I was referring to.

    The Luddites of the 18th Century failed in their time to halt the advance of technology, as likewise would any attempts to do the same in this third decade of the 21st Century.

    Things weren't exactly utopian before the industrial revolution, either. While the living conditions of the early Victorian era would appear to us as grim (certainly when viewed from a 21st Century developed nation's perspective), these actually represented a marked improvement over the living conditions of just a few decades earlier.

    People working their own land might sound like a wonderful idea - until one has actually seen the reality. I have lived in a Third World country (Papua New Guinea) where 85% of the population exists by subsistence farming (i.e. "working their own land") and that, also, is far from utopian! For those poor wretches, famine is always a very real threat, and never far away. All it takes is a natural disaster - such as drought, flood, cyclone, fire or some agricultural pest (which can be as simple as the pigs getting through the fence and destroying the food garden!) - and people starve. Furthermore, their primitive methods of agriculture are in no way sustainable. Usually described as the "slash and burn" approach, it is extremely destructive to the environment.

    It seems to be human nature to keep hankering after "the good old days"; while ignoring the fact that those "old days" were often not as good as people imagine them to have been.

  • peacefulpete
    peacefulpete

    Joey..The national debt is caused by government outspending revenues. It not due to trade deficits. The solution is a reduction in spending when possible, without creating an environment of austerity, (which triggers further loss of revenue), OR raising revenue. Again, that needs to be done so as to not trigger a drop in spending. Tax rates returned to the Kennedy/Nixon era would resolve the issue gradually, but neither party has the balls to do it.

    Returning to top tax rates that existed when "America was great", letting the Trump "Tax Cuts and Jobs Act" expire, including restoring the Alternative Minimum Tax thresholds could raise an additional trillion dollars in revenue without low to middle income Americans being negatively affected.

    Raising the SS tax rate by .2% or changing the earnings cap from $160K to $1 million dollars/ year would address the projected shortfall. Either are estimated to result in about a trillion dollars over 10 years. Presently Elon Musk pays all his SS taxes within minutes of every new year. I think he could afford to pay for an hour or so.

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