Donald Trump isn’t just beating up on farmers: he wants to tax all of us more for the goods we buy from China. Trump wants to impose yet another 10% tax on $300 billion worth of Chinese goods—pretty much everything else we buy from China that hasn’t already been tariffed—meaning another $30 billion coming out of your pocket to fuel his reckless spending. If he follows through on his threat to jack the new tariff up to 25%, that’s $75 billion in new taxes.
If our Republican delegation to Congress had any principle, they’d be up in arms over this latest tax increase, the kind of thing every one of them vowed to fight when they asked for our votes.But Congressman Dusty Johnson, Senator Mike Rounds, and Senator John Thune are all Twitter-silent so far about this latest tax on on our consumer purchases.
If Congress had any guts, it would take back its authorityover taxes and trade, the way Tim Bjorkman said it should. But guts, like principle, are in short supply from our Congressional delegation.
Tariffs have yet to produce anything Trump has promised. They haven’t helped American manufacturing. They haven’t brought manufacturers back to the U.S. They haven’t reduced the trade deficit. They just drop the hammer on American consumers and entrepreneurs.
So much for the Fed’s interest rate cut shoring up the economy; Trump appears determined to squander any stimulus with his reckless (wreckful?) trade policy. And Congress gives a pass to this unilaterally declared war on the global market and our economic well-being. Enjoy paying more taxes on your phones and flip-flops, Trump voters! You’ve get the government you deserve!
Feckless, reckless republican economics. It’s the economy stupid. Time for the rabble to get the boot.
“The government reported Friday that the U.S. economy created 164,000 seasonally adjusted new jobs in July, a significant retreat from June’s figures, but nowhere near the plunge of May, which now can be considered an outlier. As it does every month, the Bureau of Labor Statistics revised its job tally for the previous two months, changing the count for June from 224,000 to 193,000, and the count for May from 72,000 to 62,000, a combined reduction of 41,000.
The headline rate of unemployment—which the bureau calls U3—remain unchanged at 3.7% in July. That’s the best it’s been since October 1969. Another measure that takes into account underemployment as well as unemployment, and labeled U6, fell 0.2 to 7.0%. After 10 years of economic growth, that number is still higher than it has been historically.”https://www.bls.gov/news.release/empsit.nr0.htm
Down and down it goes and only so the FED will lower interest rates for the Mafia Don’s personal interest he has to pay the Deutsche Bank on his laundry loans. trump’s republican senate will go along with this as they are in the grift as well. Of course, Rounds will be “concerned” and Thune will be tall, but that is it. Dirty is of never mind and still out to lunch or ice cream.
When unions pressed for better wages, benefits, and working conditions for their US workers, they were vilified (especially by the right/conservatives/GOP). Those increased costs went into the pockets of US workers: something beneficial to the US economy, especially to sustaining and building a middle class.
As an answer, labor was exported to cheaper nations, like China.
Now that The President is increasing the costs of Chinese produced products, and this time that money is NOT going into US worker’s pockets (in fact, going FROM US worker’s pockets), can we see the COMPLETE disregard for the well-being of US workers from the right side of the political spectrum and the short-sighted wrongness of allowing corporate short-term profit to become the the driving force of an economy?
Question. How would all of you economic strategists go about getting China to have a trade agreement that actually is fair? Especially in regards to them stealing our tech and other proprietary ideas?
And since when did you hate taxes?
Did you know that raw materials manufacturers in the U.S. are booming? Aluminum, steel, etc. Why is that?
Pearson claims US Steel is booming. Then why is United State Steel Corp. selling for $13.25 today down from over a $100 a share (with a historical high of $173 a share) not too terribly long ago and has been on a continuous decline during each year of the entire Trump Administration?
Don’t Trumpists ever get tired of lying and gaslighting about objectively verifiable facts?
Steve asks a good question. The stealing of intellectual property is a problem, but let’s not forget US entrepreneurs and companies did this, too, in an earlier age. Americans were very good a reverse engineering, and still are. Really, the US was built on theft of the land and natural resources from tribes, slave labor from African Americans, the near slavery of Chinese and other minorities and the theft of foreign technology.
The big problem with China is that US companies have been so eager to get into the Chinese market that they engaged with China in participation agreements that allow too easy access to their technology. Also, they have been able to buy plans, etc., from corrupt employees of American companies. If you are going to end that, you have to get very creative on punishing American companies who allow this to happen.
Maybe booming was a bad choice of words but it has steadily increased since 2016 and continues to do so. Much of the issue is that many are at capacity right now because we’ve declined in steel production over the last few administrations. 13 to 9 with one sitting idle recently.
Maybe better guess again, Steve….https://www.investopedia.com/nerves-of-steel-needed-to-trade-steel-stocks-4690038
Over supply is pushing prices down and does not appear to change much anytime soon.
Economic Eunuch has no trade policy. It’s all about soothing his insane ego and being the center of attention.
Steve Asks: And since when did you hate taxes?
I hate all taxes that do not go for the common good. I celebrate great societies doing things for their citizens and paying for those costs through common pooling of resources. The GOP has fallen short of both ends there.
Steve Asks: Did you know that raw materials manufacturers in the U.S. are booming? Aluminum, steel, etc. Why is that?
Unless we add farming into “raw material manufacturers.” Then the economics are not so cheery. In fact, President Trumps farm bailout looks a whole lot like domestic protectionism to many of our trade partners.
This whole trade war goes back to a myth perpetuated by big business and the GOP: that US businesses cannot afford to manufacture goods in the US. A thoughtful discussion of trade ought to first challenge that premise.
Booming is a bad choice of words for Drumpf’s economy. According to Barron’s Mag, Drumpf’s 8 quarters of GDP are not quite up to Obama’s 8 best quarters, you know the economy Drumpf said was trashed and he had to start all over with the stock market already in record high territory when Obama left the building.
John Tsitrian has written an excellent post on this topic. http://bit.ly/2GJM4WW
Democratic congress far from idle. They call trump out for what he is, a traitor. You may want to add the South Dakota republican congressional delegation in that traitor category as well.
““The Mueller report and his testimony last week confirmed that the President’s campaign welcomed Russian interference in the election, and laid out ten instances of the President’s obstruction of justice. The President’s more recent attempts to prevent us from finding the facts is further evidence of obstruction of justice.” https://www.speaker.gov/newsroom/8219-2/
We all know what trump is and what his followers are, traitors.
The Tsitrian article that Debbo shares offers one good answer to Steve P’s opening question: there must be ways of bringing China to fairer trade and less intellectual property theft that don’t involve doing permanent damage to our ag sector. O responds well as well: much of the tech transfer happens because of bad decisions made by the private sector going to China and trading vital IP for access to China’s growing market and cheaper labor.
Think of the private market decisions of farmers themselves as votes. Farmers agree with the rest of us that China shouldn’t steal our IP. Farmers at any time pre-Trump could have adopted the Trump policy of refusing to trade with China until China straightened up and flew right. It seems that no farmers in South Dakota refused to sell their commodity crops to China. No player in the ag market thought that policy was worth the financial pain of denying themselves access to the Chinese market.
The fre market was speaking to Steve’s question before Trump came in. Trump ignored the free market and adopted a big-government, big-tax, anti-farm policy that so far has not produced results. Trump is now advocating the expansion of that non-functioning policy to raise taxes on Americans even higher and spread the pain and permanent damage the ag sector is experiencing to every other sector of the US economy that relies on trade with China.
The free market was setting its priorities pre-Trump: trade does more good than China does harm.
Steve, if you want to keep advocating against the free market, go right ahead. We welcome your further advocacy of communism.
Cory writes: “The free market was setting its priorities pre-Trump . . .”
I disagree. I say it was government tax code (written by the wealthy and passed by Congressional puppets) and a regulatory denigration of unions (and individual workers) at work before Trump that has been inaccurately described as “free market” forces. The wealthy have used their Socialist advantages to have a thumb on the scale too long to characterize this mess as “free market.”
Retailers are appalled at this price increase hitting just as the critical 4th quarter approaches:
These tariffs will only threaten U.S. jobs and raise costs for American families on everyday goods,” said David French, senior vice president for government relations at the Retail Federation. “The tariffs imposed over the past year haven’t worked, and there’s no evidence another tax increase on American businesses and consumers will yield new results.”
He and others warned that raising prices on everyday goods could have a chilling effect on the economy. Consumer spending makes up roughly 70% of the U.S. economy, and the retail industry accounts for one-fourth of U.S. jobs.
Companies of all sizes are likely to feel the pinch of higher prices and slowing demand. Sales of Apple iPhones, for example, could fall by up to 8 million units next year if Apple passes on a 10% price hike to consumers, according to Dan Ives, an analyst for Wedbush Securities.
In all, U.S. shoppers would pay $4.4 billion more for apparel each year the tariffs are in effect, $2.5 billion more for shoes, $3.7 billion more for toys and $1.6 billion more for household appliances, according to the Trade Partnership. Those increases come on top of earlier tariffs, which had already imposed a 25% tax on $250 billion worth of Chinese imports as varied as suitcases, garden tillers and dog sweaters.
“We survived the Great Depression, we survived the Second World War, but what we’re facing now — it’s hard to believe we’re even in America anymore,” said Lance Ruttenberg, CEO of American Textile Co. in Pittsburgh, which makes bedding for Sealy and Tempur-Pedic. “This is debilitating for businesses and for consumers.”
The Strib has an excellent opinion piece by Stephen B. Young, “global executive director of the Caux Round Table, an international network of business leaders working to promote a moral capitalism.” It is paywalled, but I believe the Strib allows a few free reads per month, so I urge you to make this one of them.
It’s difficult to summarize because it’s complex. Young says China’s goal is one leader of the world and that would be Xi Jinping, China’s leader. Xi is moving China away from focusing on Communism/Maoism and toward a Bronze Age myth known as the “Great China Dream,” or “tianxia.”
It’s a notion that China is to rule the world led by one great leader, Xi, of course. So China steals islands from Vietnam, institutes the Belt and Road infrastructure plan, tries to force total control over Hong Kong, installs thousands of facial recognition cameras, steals tech from the USA and elsewhere, etc.
Does the USA respond to this? How? Young says the tariffs are the wrong way because they hurt the US more. He urges a response of ideas infiltrating China and the Chinese people whenever they leave China. Share the knowledge that Xi is selling them a bill of goods, that they are no more exceptional than the Romans proved to be, or the Greeks, the British Empire, Napoleon, Hitler’s Aryans, etc. In short, fight Xi’s war of ideas with better ideas.
My sister and brother DFPers, your best idea is, read the piece.
China just pulled the rug out from under trump’s stupid arse. trump upped the tariff and China devalued the Yuan. Farmers, you all better switch work horses and go with old Blue. Dow is down 770 today and the futures look like it will be much the same tomorrow. Meanwhile, Rounds, Thune and Dirty, just look pathetic.
“The Chinese yuan slid to its weakest level in a decade Tuesday.
Breaching a key level of 7 per dollar could trigger capital flight and market volatility.
Watch the yuan trade in real time here.
The Chinese yuan slid to its weakest level against the dollar in more than a decade on Tuesday, raising questions about how far policymakers might let the currency fall.
The People’s Bank of China set the dollar’s reference rate, a range for domestic trading that officials set daily, at 6.9574 yuan per US dollar. The currency subsequently fell to as low as 6.9750 against the greenback, its weakest since May 2008.” https://markets.businessinsider.com/currencies/news/chinese-yuan-hits-weakest-level-in-decade-2018-10-1027671268
Bah zing, you mess with the bull and you get the horn. Welcome to capitalism trumpists. These Chinese boys and girls been playing that while we were still throwing crap into the street. One thing though, trump knows how to declare bankruptcy, that he is damn good at.