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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.
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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 ?
And why wouldn’t the price of every single item in Walmart be a million dollars ? Answer ? >> SALES.
Your problems are not "because Mexicans". Your problems are because you bleev the lies told you by your nativist propaganda outlets and populist morons like Trump (who makes his suits in Mexico).I am 100% all for border adjustment. I say we get Trump, put together a kickass, take-no-prisoners army, and move the northern border up about 200 miles further up, and move the southern border about 200 miles further down and just TAKE THE LAND. Kill everything that gets in our way. Then we will have the room we need, maybe cut off California and New England as foreign hostile territory, put up a wall and send all the undesirables there. Come across our border, and pay a 100% tax or die.
I hate to knock the ground out from under you but your link to AEI is faulty. AEI is a barely more than a lobbying group for free traders - ie. the very outsourcers being faced with having to pay the BAT. Naturally, they're going to continue the ludicrous notion that somehow firms can increase their income by raising prices (when doing so, LOWERS income, due to sales reductions) Ho hum.And what really happens:
According to our calculations, explained in this policy brief, the total cost to American consumers from higher prices resulting from safeguard tariffs on Chinese tires was around $1.1 billion in 2011. The cost per job manufacturing saved (a maximum of 1,200 jobs by our calculations) was at least $900,000 in that year (see table above).
2009 tire tariffs cost US consumers $926K per job saved and led to the loss of 3 retail jobs per factory job saved • AEI
Trump is the sponsor of BAT and tariffs generally on outsource firms. A major part of his campaign.Just a reminder of what I said in my first post in this topic, Trump is opposed to the BAT.
Sounds like YOU are the one who is doing too much believing. There's a lot of anti-Trump, anti-nationalist, pro-free trade jibberish out there.Your problems are not "because Mexicans". Your problems are because you bleev the lies told you by your nativist propaganda outlets and populist morons like Trump who makes his ties in China.
Nope. Wrong.Trump is the sponsor of BAT and tariffs generally on outsource firms. A major part of his campaign.Just a reminder of what I said in my first post in this topic, Trump is opposed to the BAT.
I wasn't disagreeing. That is beside the BAT point, and tariffs on imports.Almost 88 percent of job losses in manufacturing in recent years can be attributable to productivity growth, and the long-term changes to manufacturing employment are mostly linked to the productivity of American factories.
I hate to knock the ground out from under you but your link to AEI is faulty. AEI is a barely more than a lobbying group for free traders - ie. the very outsourcers being faced with having to pay the BAT. Naturally, they're going to continue the ludicrous notion that somehow firms can increase their income by raising prices (when doing so, LOWERS income, due to sales reductions) Ho hum.And what really happens:
According to our calculations, explained in this policy brief, the total cost to American consumers from higher prices resulting from safeguard tariffs on Chinese tires was around $1.1 billion in 2011. The cost per job manufacturing saved (a maximum of 1,200 jobs by our calculations) was at least $900,000 in that year (see table above).
2009 tire tariffs cost US consumers $926K per job saved and led to the loss of 3 retail jobs per factory job saved • AEI
Yeah, that what "really happens" >> when you a very biased source to do your talking for you.
A border adjustment tax is a stupid idea. It is another name for a tariff. It will invite retaliation. In addition, it will increase costs for consumers and consumers will have fewer choices. Taxes are paid by consumers not corporations so the idea that consumers will not suffer is ridiculous. Businesses cannot operate at a loss no matter what kind of curve you use.
You don't understand, it's not a zero sum game. As a result Trump can reduce other taxes.
Of course tariffs work and every country has tariffs. The WTO allows tariffs for a number of reasons, but in general these regulations favor developing countries at the expense of developed countries. Will the tariffs the President has proposed cost consumers something, possibly but I think most American would be willing to pay a few dollars more for their next flat screen TV if it allowed their neighbor to keep his job and his house.There is NO SUCH THING as "higher prices resulting from safeguard tariffs" No firm can raise the price of its product above its market price. To do so will put it out of business.And the reality is:
2009 tire tariffs cost US consumers $926K per job saved and led to the loss of 3 retail jobs per factory job saved • AEI
According to our calculations, explained in this policy brief, the total cost to American consumers from higher prices resulting from safeguard tariffs on Chinese tires was around $1.1 billion in 2011. The cost per job manufacturing saved (a maximum of 1,200 jobs by our calculations) was at least $900,000 in that year (see table above).
There is tons of propaganda that is to the contrary of this simple economic reality >> it is designed for the ignorant. That is what your link is. Nothing more.
We have many years of examples like the one I posted. Tariffs have never worked. Your claims don't match reality.
I am 100% all for border adjustment. I say we get Trump, put together a kickass, take-no-prisoners army, and move the northern border up about 200 miles further up, and move the southern border about 200 miles further down and just TAKE THE LAND. Kill everything that gets in our way. Then we will have the room we need, maybe cut off California and New England as foreign hostile territory, put up a wall and send all the undesirables there. Come across our border, and pay a 100% tax or die.
How do you jump from a tariff to a tax ? I'm still wondering who has to pay for a BAT (other than the outsourcer and his stockholders)All of us. Did you watch the video in the link I provided?
I also quoted the relevant part a couple posts back.
Every time the working group created a lower tax structure in thei reform, special interests got the politicians they own to put their carve outs back in. This required the tax rates to be increased right back up again.
So...BAT. Its the cowards way out.
