Good morning, Peter. I have two observations about the article. Very good, by the way. You seem to be softening a bit to the idea of tariffs, as compared to previous conversations we’ve had.
First, as to the zero sum game of businesses, whereby in order to gain business another company loses business, I have a different take. If one has not already purchased a particular item before, then there is no loss of business by another. For example, I recently made a purchase for a particular product where I had done much research before I bought. If I’ve never owned a particular item and make a first time purchase of said item, I don’t quite understand how another company is losing business, as a result. On the other hand, if I’ve already purchased that item and decide I don’t like it and repurchase that item from a different company, then yes, I have taken that business elsewhere and, in that case, one company has gained business another has lost.
Second, as to the parity of tariffs, I’m pretty sure that’s exactly what the president is trying to accomplish. Not so much to make money, but rather to not spend more than we should, thereby saving billions. That’s all he wants with reciprocal tariffs. We already know some of our “friends” like Japan and Canada are applying tariffs on certain of the exact items we trade are far exceeding what we tariff them, like in the neighborhood of 250% in some cases. If reciprocal tariffs accomplish the intended effect, which has already proven to be the case, in some instances, then we will save billions, as a result. And, if companies come to our country to avoid tariffs by opening a facility and creating more American jobs, all the better.
As to your first point, you are choosing to purchase one item. One seller will get that business, others will not. What you have to keep in mind is that, if you don't make that purchase, the wealth you'd use to make that purchase would be used for something else. That could be to purchase something else, to invest in an asset, or to sit in a bank account and thus be used for loans. The purchase represents an opportunity cost.
As to tariffs, as I wrote in an earlier piece, Trump has signaled a range of goals on tariffs. It's actually smart on his part, because it not only keeps his actual intent close to the vest, it allows people to project their own preferences into his motives. I choose not to presume what his goals are, because they could actually be any, or even "all of the above."
The other nations' tariffs are why I don't presumptively condemn his tariffs. That said, it's not the approach I would take, for various reasons.
As for "American" jobs, if they produce product at a higher cost to the consumer, we are back to the opportunity cost incurred by the end user and the economy overall. Jobs are not a finite or zero-sum quantity either, and if we get to spend less on one item, we have money to spend on other items, which create more jobs. We're damn near full employment as it is, even with the government dragging on the economy.
Now, that full employment is being purchased with inflationary deficit spending, but "creating jobs" is a massive red herring used by politicians to sell us on harmful policies.
Since the Marshall Plan and post-war rebuilding, American foreign policy has been stuck on just one - and only one - track: "soft power". Translated roughly, "soft power" sticks it to American businesses and workers to give favor - and LOTS of cash - to Not America. It has ONLY gone one way now for 75 years. We're stone broke, with $36T in debt which will take generations to pay off. And yet, our foreign policy has been stuck on favoring OTHER nations at the expense of American workers. "Be nice, do what we want and we'll shower you with cash and favorable economic policy." Trump is reversing that with the "common sense" approach of America First. As an AMERICAN president should. WE elected him to end this "America Last" BS. It has to stop. We have zero business in ordering the lives and governments of every other nation on earth. To the extent this resembles Trump as CEO of a business - keeping our "business" solvent and growing IS his job and reversing unfathomably stupid policies that are relics of a bygone era only makes sense and is long overdue.
Not flinging American tax dollars around the globe is simply a sane response to decades of failure. But, good luck selling that to conservatives. Seemingly every day, I hear "you won't like a world where America doesn't project influence."
That's the vaguest of copouts and it ignores the massive failure across decades of this "soft power" notion. I'll say again that if we had stayed out of Kuwait, the ME would not have gone the way it did, Europe would not be flooded with refugees, and it's quite possible that 9/11 might not have happened.
You are correct that "our trading partners are not paragons of free trade", but by advocating "parity", it seems you are heading down that slippery slope of advocating that the USA should be more like them, rather than the other way around. True, their trade policies may not be "fair" (however one defines the term), but the biggest victims of this unfairness are their OWN citizens, who should realize that THEY are being "ripped off", and demand freer markets - like, you know, the USA.
Perhaps I wasn't clear enough that I want freer trade across the board. Looking for parity and reciprocity is about improving access to other markets, not restricting access to our own.
Although my opinion is not in lockstep with yours re tariffs in general, I'm thoroughly behind, "bilateral reciprocal agreements, where, if there are to be tariffs and quotas, they are in parity".
Good morning, Peter. I have two observations about the article. Very good, by the way. You seem to be softening a bit to the idea of tariffs, as compared to previous conversations we’ve had.
First, as to the zero sum game of businesses, whereby in order to gain business another company loses business, I have a different take. If one has not already purchased a particular item before, then there is no loss of business by another. For example, I recently made a purchase for a particular product where I had done much research before I bought. If I’ve never owned a particular item and make a first time purchase of said item, I don’t quite understand how another company is losing business, as a result. On the other hand, if I’ve already purchased that item and decide I don’t like it and repurchase that item from a different company, then yes, I have taken that business elsewhere and, in that case, one company has gained business another has lost.
Second, as to the parity of tariffs, I’m pretty sure that’s exactly what the president is trying to accomplish. Not so much to make money, but rather to not spend more than we should, thereby saving billions. That’s all he wants with reciprocal tariffs. We already know some of our “friends” like Japan and Canada are applying tariffs on certain of the exact items we trade are far exceeding what we tariff them, like in the neighborhood of 250% in some cases. If reciprocal tariffs accomplish the intended effect, which has already proven to be the case, in some instances, then we will save billions, as a result. And, if companies come to our country to avoid tariffs by opening a facility and creating more American jobs, all the better.
That’s my take. Have a great one!
As to your first point, you are choosing to purchase one item. One seller will get that business, others will not. What you have to keep in mind is that, if you don't make that purchase, the wealth you'd use to make that purchase would be used for something else. That could be to purchase something else, to invest in an asset, or to sit in a bank account and thus be used for loans. The purchase represents an opportunity cost.
As to tariffs, as I wrote in an earlier piece, Trump has signaled a range of goals on tariffs. It's actually smart on his part, because it not only keeps his actual intent close to the vest, it allows people to project their own preferences into his motives. I choose not to presume what his goals are, because they could actually be any, or even "all of the above."
The other nations' tariffs are why I don't presumptively condemn his tariffs. That said, it's not the approach I would take, for various reasons.
As for "American" jobs, if they produce product at a higher cost to the consumer, we are back to the opportunity cost incurred by the end user and the economy overall. Jobs are not a finite or zero-sum quantity either, and if we get to spend less on one item, we have money to spend on other items, which create more jobs. We're damn near full employment as it is, even with the government dragging on the economy.
Now, that full employment is being purchased with inflationary deficit spending, but "creating jobs" is a massive red herring used by politicians to sell us on harmful policies.
Well said but more importantly based in the misnomered position of commonsense, the rarest perspective on any subject.
Since the Marshall Plan and post-war rebuilding, American foreign policy has been stuck on just one - and only one - track: "soft power". Translated roughly, "soft power" sticks it to American businesses and workers to give favor - and LOTS of cash - to Not America. It has ONLY gone one way now for 75 years. We're stone broke, with $36T in debt which will take generations to pay off. And yet, our foreign policy has been stuck on favoring OTHER nations at the expense of American workers. "Be nice, do what we want and we'll shower you with cash and favorable economic policy." Trump is reversing that with the "common sense" approach of America First. As an AMERICAN president should. WE elected him to end this "America Last" BS. It has to stop. We have zero business in ordering the lives and governments of every other nation on earth. To the extent this resembles Trump as CEO of a business - keeping our "business" solvent and growing IS his job and reversing unfathomably stupid policies that are relics of a bygone era only makes sense and is long overdue.
Not flinging American tax dollars around the globe is simply a sane response to decades of failure. But, good luck selling that to conservatives. Seemingly every day, I hear "you won't like a world where America doesn't project influence."
That's the vaguest of copouts and it ignores the massive failure across decades of this "soft power" notion. I'll say again that if we had stayed out of Kuwait, the ME would not have gone the way it did, Europe would not be flooded with refugees, and it's quite possible that 9/11 might not have happened.
Venetoklis for SECSTATE!!! 🇺🇸❤️🇺🇸
Yeah, that's the last job I'd want... :)
You are correct that "our trading partners are not paragons of free trade", but by advocating "parity", it seems you are heading down that slippery slope of advocating that the USA should be more like them, rather than the other way around. True, their trade policies may not be "fair" (however one defines the term), but the biggest victims of this unfairness are their OWN citizens, who should realize that THEY are being "ripped off", and demand freer markets - like, you know, the USA.
Perhaps I wasn't clear enough that I want freer trade across the board. Looking for parity and reciprocity is about improving access to other markets, not restricting access to our own.
Although my opinion is not in lockstep with yours re tariffs in general, I'm thoroughly behind, "bilateral reciprocal agreements, where, if there are to be tariffs and quotas, they are in parity".
As always, superlative phrasing!