Wisconsin already reeling from tariffs coming from Mexico, Canada, Europe
47 replies, posted
I don't think his argument is ever that other countries have unfair tariffs. He bitches about NAFTA which eliminates most of not all tariffs between the US, Canada, and Mexico. His goal isn't to reduce the number of tariffs overall or eliminate 'unfair' tariffs, so much as it is to play to a base of people who are convinced that allowing free trade with Canada and Mexico left them out of a job.
The problem with this line of thinking is that, as a whole, the economy benefits from less tariffs and more free trade. Other sectors benefit far more than sectors which begin to struggle when trade duties are reduced or eliminated. The net economic gain is universally higher, which generally speaking means more jobs in sectors which can benefit from cheaper goods and more economic growth as a whole.
Free trade agreements are in a weird place right now though because leftists don't like icky global capitalism and rightists don't like da foreigners takin' dur jurbs so we're in a bit of a pickle where populist idiots on both ends of the spectrum are basically clamoring for their governments to tear down the institutions which increase general productivity for all parties involved and help prevent large-scale warfare by making conflict unprofitable in comparison to cooperation.
Possible this could have no effect, or even the opposite effect of trying to mess with Republicans. The Fox/Sinclair machines could just go "the dirty Europeans are tariffing honest goods, vote GOP to retaliate"
What then, are we supposed to take those stupid tarrifs lying down?
That's like a kid throwing punches and then crying to the teacher when he gets punched back.
No, that's not really what I'm saying. I'm still not totally on board with it even in this situation. It's just that I can at least excuse it here despite being very iffy on the concept specifically because Trump is doing some really stupid shit that's has little to no potential of doing what he's claiming it will do while negatively impacting both our own economy and those of our allies. So I'd rather see a temporary harsher impact on those places who voted this buffoon into office rather than letting our economy tank hard because of his idiotic policies.
But how does that relate to his claim that other countries, including within EU, gets "free money" from trade deals with the US because of tariffs? The claim about 300% on dairy exports for example, is it true? I'm mostly interested in if its true or not that the US is at a trading disadvantage.
The EU and Canada can be pretty fucking protectionist at times, and that is one area (for Canada) where they are very high.
Although it should be noted that those high tariffs don't actually apply to much, so claiming that we're getting crushed by unfair trade is a bit erroneous, but they do exist. With the EU there were talks pre-trump about relaxing a lot of what existed, not sure if there was anything going on w/ Canada. (The dairy tariffs are absurdly popular and farmers are pretty loud rent-seekers.)
Canada has what could be considered "protectionist" tariffs on some key things like dairy -- the reason for this is that our dairy supply chain can't possibly hope to compete with the dairy supply chain from the US (a country with a population roughly 10x ours) on even footing and we'd be crushed out of existence, leaving us entirely dependent on dairy imports. It's an absolutely essential tariff for maintaining a domestic market and keeping it from being steamrolled by big brother milk to the south. Trump, of course, would prefer we buy 100% of our dairy from the US, no matter how insane an idea that is.
It's the same notion as the steel and aluminum tariffs Trump applied, having the idea of protecting America's domestic supply chain, except steel and aluminum aren't nearly as directly integral to a nation's healthy food supply.
Canada subsidizes our publishing industry, as well, and for the same reason -- American publishers can by default expect to sell around 10x more copies of any given book, so their per-unit costs are insanely cheap compared to what a Canadian edition would cost to produce. The setup costs for getting a print run prepared are the same whether you make 1,000 copies or 10,000 copies, but if you make 10,000 copies you can make your money back at 1/10th the cost you'd need to charge for a print run of only 1,000.
We have limited, specifically-targeted subsidies that are intended to protect vulnerable Canadian markets against crushing domination by the much larger American market. They exist not to give us an "unfair advantage" over the US but to keep our important industries from being driven bankrupt by pure American market mass. I expect Trump to understand precisely nothing about that as part and parcel of his incredibly simple view of the complex and counterintuitive global economy.
In fact, specifically on the topic of dairy, we already are at a massive trade deficit against the US (meaning the US exports far more to us than we export to them), and Trump is just making shit up out of thin air.
Here's the info straight from the federal government of Canada: http://www.dairyinfo.gc.ca/index_e.php?s1=dff-fcil&s2=imp-exp&s3=bal
http://www.dairyinfo.gc.ca/images/bal_e.jpg
Data Source: Statistics Canada
Those red bars are tall and they'd be even taller if we didn't put tariffs on imported dairy to protect our domestic production system.
Unfortunately, this is the penance America must make for our boneheaded decision in 2016. What is fortunate is that it'll primarily hit the morons who voted him in in the first place.
Sorry, conservatives, but y'all dug your own graves on this one. I hope you feel the effects cut deep, maybe it'll shake you out of your stupor and make you realize that this is the kind of suffering we've been going through.
It's all just comparative advantage and deadweight loss, I don't see states demanding tariffs on each-other for similar things either. (e.g. wyoming trashing all the others in coal prod.) The very point is that the areas that a country is weak in will wither and they country will focus on what they are strong at.
Being cut off from steel and aluminum would trash an economy and severely hamper a military, dairy is unnecessary.
Hi, I live in a community that is isolateable in the event of an emergency, and as part of long-term disaster preparedness and self-sufficiency, this area has its own local dairy industry.
In a completely free-market scenario, imports from the US would be too economically attractive to bother, and the local industry would wither and die except as a cottage industry. And then a major disaster cuts off outside access and now the only milk in the area is what's already here and there isn't more coming until the government gets disaster aid in and then when supply chains are reestablished. That's not an ideal situation, but it's profitable.
Being able to source milk locally is more important than having a domestic aluminum industry, in the US and Canada case at least.
Also what kind of military action do you foresee the US entering in the near future where CANADA would not be a firm ally or at least a trading partner willing to hold their nose and look aside?
Throw a dart at a map and see if whatever you land on has ever made Trump piss his pants. Repeat until you have your answer.
If you have to repeat at all.
I don't foresee that kind of a military action, and I'm not defending the steel and aluminum shit. Likewise I'm not sure what you're trying to address that can't be solved by stockpiling durable foods.
Also by "profitable" I hope you're referring to consumer welfare, because the cost of your protectionism is dairy being more expensive for Canadians, empirically, these costs usually greatly outweigh amount of jobs provided. If it's for aesthetic reasons, then whatever.
Well, the US is paying for their dairy too (granted with some of the less stringent health requirements, it may be cheaper). US dairy receives, $22.2 Billion in direct and indirect subsidies, accounting for 73% of the returns that farmers saw, meaning you're paying twice whether you drink milk or not. Canada dairy doesn't see any direct monetary subsidies, but it does result in a higher price of milk when purchasing. However, it does mean that there is much less price instability, something which has plagued us dairy. I've read a number of pieces even saying that the US should adopt Canada's milk model for that reason.
Furthermore, prices are actually pretty similar if you consider rbST-free milk (growth hormone not allowed in Canadian milk) from the US to Canadian milk. The American milk actually costs 1.64 a litre compared to 1.50 this way. The difference can probably be accounted to a more niche market on the American front for the milk (with the standard milk price being much cheaper) and I imagine would be more inexpensive.
I mean I do agree that that's something Canada may want to push for, and ideally it's something trade deals give mechanisms to work to accomplish. I just don't buy ideas of trying to counteract the very reason you do trade in the first place.
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