Border Adjustment Tax Is Worthy of Support

[g5000]

When our Constitution was signed, 90 percent of Americans were employed in agriculture.

90 percent.

Imagine if 9 out of 10 people you knew were farmers.

Today, less than 2 percent of Americans are employed in agriculture, even though we are growing more food than ever before.

All those farming jobs went away because of technology.

What kind of retard would a politician be today if they stumped on "bringing back all those lost farming jobs"?

He'd be an idiot, right?

Just so with manufacturing, folks. Just so with manufacturing.

The jobs have moved into the service industry. The children of farmers grew up to be auto assembly line workers, and their grandchildren are software engineers and reality TV hosts.

 

[g5000]

Economists project that border adjustments will cause the dollar to strengthen relative to other currencies, and that the increased tax on imports will be fully offset by imports’ reduced cost. This offset is all but certain in the long term. It’s the short term that’s at risk.

No Need to Fear the Border-Adjustment Tax

The strengthening of the US dollar is somewhat controversial, not everybody agrees on how much that'll happen. And that means it may not offset the effects of a BAT. Other thing is, when you implement a BAT, that could result in foreign countries taking retaliating actions that changes the equation. Perhaps not only economically but in other spheres, suck as political, military, intelligence, etc.

How can our trading partners who all have BATs retaliate for us implementing the same thing?

"How dare they! Does the US think they are special?!?"

 

[protectionist]

Most of our manufacturing jobs which have gone away did not go overseas. 88 percent of them were obsoleted by technology which has increased worker productivity.

Those jobs are never coming back, period.

We are manufacturing more stuff than ever. It just takes less workers to do it.

The big money is still flowing, but the number of jobs is shrinking.

Some of our low-skilled manufacturing, like T-shirts, has moved to places like Bangladesh and Vietnam, but the vast majority of our jobs are simple obsoleted by machines.

And by bringing back companies/jobs that DO utilize human labor (which is why they went overseas), we increase the # of jobs available in the US.

 

[Brain357]

Border adjustments are a feature of virtually all of the tax systems employed by our trading partners, so adopting them will in essence level out our tax system that has historically had it backward.

No Need to Fear the Border-Adjustment Tax

New York Fed economists doubt that the dollar would rise solely because of the new tax plan. They argue that other countries could implement the same tax or retaliate against the United States in other ways on trade.

Fed economists criticize House GOP border tax

 

[g5000]

Just for the record, I am against the BAT the Republicans are trying to enact.

Not because I am principally opposed to BATs, but because they are trying to enact it for extremely corrupt reasons.

 

[protectionist]

The strengthening of the US dollar is somewhat controversial, not everybody agrees on how much that'll happen. And that means it may not offset the effects of a BAT. Other thing is, when you implement a BAT, that could result in foreign countries taking retaliating actions that changes the equation. Perhaps not only economically but in other spheres, suck as political, military, intelligence, etc.

Hate to inform you, but they are ALREADY fulfilling those - are into maximum mode.

 

[protectionist]

New York Fed economists doubt that the dollar would rise solely because of the new tax plan. They argue that other countries could implement the same tax or retaliate against the United States in other ways on trade.

Fed economists criticize House GOP border tax

One cannot retaliate by doing what one is ALREADY doing.

 

[g5000]

Most of our manufacturing jobs which have gone away did not go overseas. 88 percent of them were obsoleted by technology which has increased worker productivity.

Those jobs are never coming back, period.

We are manufacturing more stuff than ever. It just takes less workers to do it.

The big money is still flowing, but the number of jobs is shrinking.

Some of our low-skilled manufacturing, like T-shirts, has moved to places like Bangladesh and Vietnam, but the vast majority of our jobs are simple obsoleted by machines.

And by bringing back companies/jobs that DO utilize human labor (which is why they went overseas), we increase the # of jobs available in the US.

If the dollar is made stronger, and the cost of the BAT is cancelled out as a result, there is no motivation to bring back those T-shirt making jobs.

Besides, what good would it do to bring back low-skilled, low paying jobs?

Better to train our workforce for the jobs of tomorrow, not yesterday's jobs.

 

[protectionist]

Just for the record, I am against the BAT the Republicans are trying to enact.

Not because I am principally opposed to BATs, but because they are trying to enact it for extremely corrupt reasons.

Clarification requested.

 

[Brain357]

Yes they do lose jobs. Steel tariffs saved few jobs in steel and cost many more in manufacturing.

When firms return to the US (their overseas status having become uneconomical), jobs are created in the US, not lost.

Give an example when that has ever happened.

 

[g5000]

Just for the record, I am against the BAT the Republicans are trying to enact.

Not because I am principally opposed to BATs, but because they are trying to enact it for extremely corrupt reasons.

Clarification requested.

I'm going to post this link again. Please watch the video in it: No tax reform without border adjustment tax, Rep. Nunes says

If you properly understand what Nunes is saying, it should make you very angry.

 

[protectionist]

If the dollar is made stronger, and the cost of the BAT is cancelled out as a result, there is no motivation to bring back those T-shirt making jobs.

Besides, what good would it do to bring back low-skilled, low paying jobs?

Better to train our workforce for the jobs of tomorrow, not yesterday's jobs.

They're only low paid because of the countries they're in. As for training in other fields, nobody is knocking that. Certainly not me.

 

[sartre play]

President Trump’s support in getting elected POTUS, in part, came from the proposal to slap outsource companies overseas, with tariffs on their imports. The idea being to make it uneconomical for those companies to operate outside the US.

Forcing them to return to the US, together with deporting illegal aliens, will indeed create more jobs (FOR AMERICANS), dramatically raise the amount of disposable income inside the US, and boost sales of US companies, creating the GDP growth we need.

Well. Now we have the naysayers. As with most critics, they are a varied group. First, there are those companies who ARE operating outside the US (and their stockholders), who don’t want to change. They only care about what’s good for THEM, and not the nation.

Then there’s the outsourcing lobby groups (Trilateral Commission, Council on Foreign Relations, etc). Then there’s opportunist politicians who support outsourcing for their own personal political gain (ex. Hillary Clinton). Last but not least there’s the Trump bashers who simply cling to an opposition of whatever Trump does, and then conjure up some ”reason” to oppose him.

Perhaps the main thrust of the tariff opponents, is the claim that they will harm the American consumers by causing prices to rise on the taxed imports. 40 years ago, as an economics teacher in the City University of New York, I taught how companies employ this myth as a scare tactic to anyone who never studied microeconomics, and doesn’t know the simple fact about how prices are established (and maintained).

Briefly, firms CANNOT just raise prices whenever they fell like it. As a former business owner myself, I know that each product has its MARKET price. This comes from the market, not us business owners. We actually have little to nothing to say about what our price will be.

The price is the highest price that can be charged, without triggering income reductions from reductions in SALES$$. A price is a number. It’s not just somebody’s lucky number. Or their birthday. Pricing experience reveals what the market price is, and any change up or down, results in reduced income.

This can be graphically shown by a bell-shaped curve, with income on the Y axis, and prices rising on the X axis. The market price (ei. the prices you see on the store shelves) are a point on the top of the curve.

View attachment 130383

Without a college course, people can just use their common sense. If firms could bring more money in (to compensate for some new expense), just by raising prices, why wouldn’t they have had those higher prices the month before ? And the month before that, etc ?
There not going to except lower profits to help get people jobs. that's a pipe dream.
And why wouldn’t the price of every single item in Walmart be a million dollars ? Answer ? >> SALES.

I'm not an economics professor so explain the fault in my reasoning. Walmart has low prices because they get their goods at places that have lower production costs. I think I read that the biggest cost of any good is labour costs. You suggest that Walmart move the production to the US thereby driving up labour costs. This would drive up prices for goods. More people get employed sure, but I don't think that increase in employment would even out the price of goods. Unemployment rate I just checked is 4,7 percent. not particularly high. Would being able to employ these people make up for the price hikes?

I believe that a border tax would not increase prices significantly, it would simply decrease the profit margins of some businesses and, if businesses overprice it will allow other competitors to enter the market who are willing to accept smaller profit margins.

Also, said businesses would have to work harder to get better labour deals overseas in order to decrease their costs to offset the border tax.

In theory, a border tax would not be good for consumers, but, when operating in the current heavily skewed climate of extremely UNDER priced wages and currencies in places like China, such a tax would be wise and effective without impacting consumer costs much if at all. It would also balance out abuses of trading partners like Canada who enter American businesses in Canada and are in fact socialist. Free markets and socialist markets don't mix, so why pretend it's an even playing field?

 

[g5000]

You can feel Nunes' frustration in the video. He strikes me as my kind of guy on taxes.

 

[protectionist]

I'm going to post this link again. Please watch the video in it: No tax reform without border adjustment tax, Rep. Nunes says

If you properly understand what Nunes is saying, it should make you very angry.

Maybe on Monday I'll check it out. I'm on a public library computer, and I only have 8 minutes left (been here 3 hours now)

 

[task0778]

"Of course the price has to exceed cost by a certain amount of profit. So ??"
So, if you institute a BAT you have just raised the COST. In which case the company has to raise the price to maintain their profit if the market will bear it. Or they cut costs elsewhere if they can, or they go out of business. But to suggest that the production cost for your product (which includes the BAT if there is one) has no influence on the price is ludicrous, that's why many foreign made products are sold in Walmart; they can sell their stuff for a lower PRICE because their production COSTS are lower. Gettingit now?

"Some business may be able to absorb the additional cost of a BAT and still operate, some may not. For the ones who cannot still operate, THEY DON'T. They go out of business - showing that were unable to be in business in the first place, and shouldn't have been."
You are displaying a remarkable lack of understanding for how businesses are started and how they function. Obviously if a BAT is already in place then any new company is going to include that factor in their decision to go into business in the 1st place. Which is why if you create a BAT you are going to reduce the number of startup businesses, the risk is greater. Now - if you create a BAT then the companies already in existence will have to factor that intot heir future plans; how are they going to deal with the added expense. And one of the ways they'll deal with it is increasing the PRICE if they think the demand will not drop significantly. Or they take other steps, perhaps in concert with a small price increase and some other actions. That is why a BAT could impact the price.

"you should pay AMERICANS a decent, standard American wage, or you shouldn't be in business."
Non sequitor. Has nothing whatsoever to do with a BAT. Many businesses operate today on a fairly thin profit margin. Add in a BAT and you could be tipping the edge over to where the reward is so small or even non-existent relative to the risks of losing money or an insufficient profit. Money flows to where it makes the highest return you know. Which means there are consequences to adding a BAT into the equation for many businesses. And to say they shouldn't be in business in the first place is extremely unjust; that's a rash judgement based on nothing but you personal biases. As a former business owner you ought to know that there are some factors that change as your business adapts to a changing marketplace. Innovations, changing rules and regulations, changes in tax rates or laws, etc. If you institute a BAT there will be consequences, maybe the federal gov't gets more revenue and maybe some businesses more than otherwise and people lose their jobs more than otherwise."

1. You're still hoodwinked by those who claim that prices will go up, if the firm gets additional costs. You simply don't understand what makes a price. Reread what I wrote about the market price, price hikes and reductions in SALES$$$, and the bell shaped curve. I suggest you take a college course in microeconomics, although it might not help because I've been giving you one right here , and you're just not getting it. Some kind of mental block, whatever.

First of all, you can take your condescending attitude and stuff it. And BTW we're talking macro economics here not micro. Consider this:

The Republicans' plan to enact a border adjustment tax will leave consumers digging deeper into their pockets, an advisor to a coalition of major retailers told CNBC on Monday.

The measure is part of the House GOP's corporate tax plan and would tax imports and exempt exports.

"It will force consumers to pay as much as 20 percent more for the products they need. Gasoline is estimated to go up as much as 35 cents a gallon," said "Americans for Affordable Products" advisor Brian Dodge in an interview with "Power Lunch."

"Common household goods, apparel, things that people count on every day, pajamas, will cost more and really just so a certain, select group of corporations can avoid paying taxes forever. We think that's bad policy," he added.

Consumers could see 20% price hike with border adjustment tax, retail group says


2. It's not unjust to say that they shouldn't be in business in the first place. If they can't afford to be in business, then they should do what all the rest of us do (who also can't afford it) >> GET A JOB!

It's pretty stupid to raise taxes if it costs people their jobs in the first place.


3. People don't lose jobs from a tariff, which causes firms to return to the US. People (Americans that is) GAIN jobs.

Yeah they do. You obviously don't want to see the big picture, but the laws of supply and demand are immutable. When you increase taxes on businesses you have just raised the costs of supply, and THAT affects the price which affects demand. It boggles the mind that some people cannot grasp that simple fact.

PS - do you not know how to use the quoting system in this forum ? You click the REPLY tab and then post. If you want to change something, you click the EDIT tab. Good luck.

Sometimes it's nice to cut to the chase as it were, and remove some of the clutter. Is that against the rules, as long as I don't change your statements?

 

[protectionist]

Give an example when that has ever happened.

On Monday. I'm on a public library computer, and have only 4 minutes left. (with other threads to work)

 

[protectionist]

Sometimes it's nice to cut to the chase as it were, and remove some of the clutter. Is that against the rules, as long as I don't change your statements?

I don't know what you;re talking about. Am I fortunate ?

 

[g5000]

"The only way we can get our tax code into the 21st century and make America the most competitive place on the planet is to move to a full consumption-based system," added Nunes.

Outstanding!

But here is what Congressman Nunes says in the video which is not in the text of the article which should anger every fiscal conservative to the max:

"If people wanted to drop the corporate rate from 35 to say 33, 32, maybe 30, we could probably do it. But if you go back to several years that we looked at doing just that, the goal was to get to 25 percent, and by the time every lobbyist, every special interest group in town, representing every major corporation in this country, the tax rate was automatically all the way back above 30 by the time you put everybody's special loophole in."

Read that. Read it, and read it, and read it again until you get it.

THAT is why the committee had no choice but to add a BAT to the tax code. Because of...anyone?....anyone?...

TAX EXPENDITURES.


We all have to pay a higher individual tax rate, and a higher corporate tax rate, and now a BAT, because of tax expenditures.

Just as I have been saying for YEARS.

 

[The Sage of Main Street]

"Of course the price has to exceed cost by a certain amount of profit. So ??"
So, if you institute a BAT you have just raised the COST. In which case the company has to raise the price to maintain their profit if the market will bear it. Or they cut costs elsewhere if they can, or they go out of business. But to suggest that the production cost for your product (which includes the BAT if there is one) has no influence on the price is ludicrous, that's why many foreign made products are sold in Walmart; they can sell their stuff for a lower PRICE because their production COSTS are lower. Gettingit now?

"Some business may be able to absorb the additional cost of a BAT and still operate, some may not. For the ones who cannot still operate, THEY DON'T. They go out of business - showing that were unable to be in business in the first place, and shouldn't have been."
You are displaying a remarkable lack of understanding for how businesses are started and how they function. Obviously if a BAT is already in place then any new company is going to include that factor in their decision to go into business in the 1st place. Which is why if you create a BAT you are going to reduce the number of startup businesses, the risk is greater. Now - if you create a BAT then the companies already in existence will have to factor that intot heir future plans; how are they going to deal with the added expense. And one of the ways they'll deal with it is increasing the PRICE if they think the demand will not drop significantly. Or they take other steps, perhaps in concert with a small price increase and some other actions. That is why a BAT could impact the price.

"you should pay AMERICANS a decent, standard American wage, or you shouldn't be in business."
Non sequitor. Has nothing whatsoever to do with a BAT. Many businesses operate today on a fairly thin profit margin. Add in a BAT and you could be tipping the edge over to where the reward is so small or even non-existent relative to the risks of losing money or an insufficient profit. Money flows to where it makes the highest return you know. Which means there are consequences to adding a BAT into the equation for many businesses. And to say they shouldn't be in business in the first place is extremely unjust; that's a rash judgement based on nothing but you personal biases. As a former business owner you ought to know that there are some factors that change as your business adapts to a changing marketplace. Innovations, changing rules and regulations, changes in tax rates or laws, etc. If you institute a BAT there will be consequences, maybe the federal gov't gets more revenue and maybe some businesses more than otherwise and people lose their jobs more than otherwise.


"

1. You're still hoodwinked by those who claim that prices will go up, if the firm gets additional costs. You simply don't understand what makes a price. Reread what I wrote about the market price, price hikes and reductions in SALES$$$, and the bell shaped curve. I suggest you take a college course in microeconomics, although it might not help because I've been giving you one right here , and you're just not getting it. Some kind of mental block, whatever.

2. It's not unjust to say that they shouldn't be in business in the first place. If they can't afford to be in business, then they should do what all the rest of us do (who also can't afford it) >> GET A JOB!

3. People don't lose jobs from a tariff, which causes firms to return to the US. People (Americans that is) GAIN jobs.

PS - do you not know how to use the quoting system in this forum ? You click the REPLY tab and then post. If you want to change something, you click the EDIT tab. Good luck.

Yes they do lose jobs. Steel tariffs saved few jobs in steel and cost many more in manufacturing.

Wall Street Withers Away the Nation

Among other things, what rusted the steel industry was the fact that in the 60s, the United Steelworkers union got its best deal ever. People don't realize enough that there are no "steel owners"; instead, there are controlling stockholders who can get out of steel anytime they want and put their money in some other sector. So the union-hating parasites decided to bribe Congress to eliminate tariffs and let foreign steel take over. Then they sold their stocks to suckers outside the loop who had not been informed yet that the steel industry had been betrayed by a transnationalist clique.