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#16 | Posted by snoofy at 2025-03-07 11:24 AM
Any gain there is more than undone, just with the on-paper math, simply by factoring in the tariffs.
Ah, that "most beautiful word - tariff" ... another populist idea Trump stole from Democrats, who have been champions of tariffs as protectionist measure on behalf of unions... not that it actually worked to protect the organized American Labor (unions now are at ~10% total, ~6% private labor force), only making it more expensive and "pricing [some] US goods out of the global and domestic markets."
Trump's guru / influencer on tariffs is lifelong Democrat Prof. Peter Navarro.
At least, UAW bosses, as usual, approve of [Trump's] tariffs: "Tariffs are a powerful tool in the toolbox for undoing the injustice of anti-worker trade deals... [UAW] is in active negotiations with the Trump Administration about their plans to end the free trade disaster ... and looks forward to working with the White House to shape the auto tariffs in April to benefit the working class."
And tariffs don't solve the non-issue / non-problem of "national trade deficits" - just create disruptions and big "uncertainty" headaches for supply chain managers.
In a capitalist country / society, national "trade deficit" (bilateral or total) is irrelevant and is just an interesting statistic having no significant economic value (other than possibly tracking supply chains and bottlenecks), except in Trump's warped brain. Countries have very little direct trade between themselves - companies usually import and export goods, depending on supply and demand. For example, if you buy a Rolls-Royce for yourselves and Bentley or Mercedes for your mistress, does that mean the US now has a "trade deficit" with Germany, and "Germany" now has to buy equivalent $$ amount in goods from the US?
What's more, trade deficits not only do not lead to inflation, they help maintain USD "reserve currency" status and may help finance the US gov't debt, as China, Japan and many other countries have been doing until recently.
The US has a heavy equipment and service "trade surplus" with the "rest of the world" including China. Trade "deficit" is often a sign of strong economy and provide millions of retail and wholesale trade-related jobs, including in manufacturing.
Last time the US had "national trade surplus" was in 1970s - those were the "good times," right? "Malaise," stagflation...
www.cnbc.com - Stagflation fears bubble up as Trump tariffs take effect and the economy slows - 2025-03-04
scholar.harvard.edu - Truth About Trade Deficits / "Fake Problem" - [PDF, 3 pg] - October 7, 2018
www.cato.org - Ignore the Politicians: Trade Deficits Don't Really Matter - Aug 29, 2024
"This is a fallacious claim because trade deficits don't really matter - not between countries and not between you and your local grocery store."
apnews.com - How Trump justifies his tariffs " from budget balancing to protecting 'the soul' of America - AP, 2025-03-06
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drudge.com :
"... We too often talk about trade while using the vocabulary of war. In war, for one side to win, the other must lose. But commerce is not warfare. Trade is an economic alliance that benefits both countries. There are no losers, only winners. And trade helps strengthen the free world."
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