"Trade wars are good"

[geordief]

http://www.bbc.com/news/world-us-canada-43257712

according  to the President of the USA  and he expects to "come out on top"(him or the USA ,I wonder?)

 

Discounting the madness (and badness) behind the remark has this  actually kicked off a proper trade war and will any side actually  benefit from it?

 

And in any trade war does the USA have any upper hand any more? Is USA's economic hegemony a thing of the past (Trump or no Trump)?

[John Cuthber]

It's a simplistic approach but, the GDP of the US is slightly bigger than that of the EU so, in principle it might be able to bully them.
However the rest of the world  id s likely to side with the EU.

 

It also gives the game away that he doesn't really believe in free market capitalism. That may well help his political opponents.

[Strange]

1 minute ago, John Cuthber said:

It also gives the game away that he doesn't really believe in free market capitalism

That shouldn’t be a surprise to anyone but seeing him follow through on it might have an effect. 

[geordief]

Will his blatant rhetoric undermine the case that steel is a strategic commodity and not subject to WTO rules?

Edited March 2, 2018 by geordief

[studiot]

1 hour ago, geordief said:

Is USA's economic hegemony a thing of the past (Trump or no Trump)?

I'm not sure about modern China, but I think the USA is still the only country in the world that, if it chose to close the doors and pull up the drawbridge, could obtain everything it needs within its own borders.
 

[Ten oz]

As it pertains to Steel the U.S. is behind China, E.U., Japan, and India in production and is 11th for exports of Steel. At the same time the U.S. is the worlds top importer of Steel. While tariff might boost production of Steel in the U.S. it will surely drive up the cost of Steel. As a side effect builders will look to other building materials that is more cost effective. For Aluminum the U.S .is #9 in production but the worlds top importer. 

Also individual large corporations contribute to the GDP of many different countries. Volkswagen is a German company but has tens of thousands of employees in the U.S., Toyota is a Japanese company but employs tens of thousands of people in the U.S., and etc. U.S. companies from Apple to Walmart rely of other countries for manufacturing and services. Trade wars only make it more difficult for global industry. 

 

5 minutes ago, studiot said:

I'm not sure about modern China, but I think the USA is still the only country in the world that, if it chose to close the doors and pull up the drawbridge, could obtain everything it needs within its own borders.
 

While 100% true the U.S. has never shown a willingness to put in the labor required to do that. Slavery and indentured servitude have long traditions in the U.S. for that reason. Even today undocumented immigrants are widely used in U.S. labor markets like agriculture and construction. Undocumented immigrants are quasi indentured servants. In order for the U.S. to close its doors and pull the drawbridge ten of millions of people would have to work in more physically demanding and labor intensive jobs than their accustomed to, willing to, and in many cases capable of.  Trump and millions of others romanticize labor intensive jobs like coal mining but actually desire comfortable white collar work for themselves and families. It is why the U.S. is the number one importer of goods. We like having others do the hard work. 

[geordief]

2 hours ago, Ten oz said:

 

 

While 100% true the U.S. has never shown a willingness to put in the labor required to do that. Slavery and indentured servitude have long traditions in the U.S. for that reason. Even today undocumented immigrants are widely used in U.S. labor markets like agriculture and construction. Undocumented immigrants are quasi indentured servants. In order for the U.S. to close its doors and pull the drawbridge ten of millions of people would have to work in more physically demanding and labor intensive jobs than their accustomed to, willing to, and in many cases capable of.  Trump and millions of others romanticize labor intensive jobs like coal mining but actually desire comfortable white collar work for themselves and families. It is why the U.S. is the number one importer of goods. We like having others do the hard work. 

 

 

I  imagine the Steel industry  it is far less labour intensive than  it was.

I wonder if those in the industry  are realistic to expect many new jobs to return if these new tarifs take effect (I realise that other related industries will actually be losers on that score)

 

Edited March 2, 2018 by geordief

[Ten oz]

19 minutes ago, geordief said:

 

 

I  imagine the Steel industry  it is far less labour intensive than  it was.

I wonder if those in the industry  are realistic to expect many new jobs to return if these new tarifs take effect (I realise that other related industries will actually be losers on that score)

 

Start up costs for new facilities are steep and output at existing ones are probably already maximized. I doubt new facilities to open based on tariffs. Taxes and Tariffs can be changed anytime so long term investment based on them is a gamble in my opinion. I suspect businesses will just pay extra and pass those costs along to consumers in the short term. In the long term, if the 25% continues, industries will look to supplement with other materials to reduce costs.

[studiot]

5 hours ago, Ten oz said:

While 100% true the U.S. has never shown a willingness to put in the labor required to do that. Slavery and indentured servitude have long traditions in the U.S. for that reason. Even today undocumented immigrants are widely used in U.S. labor markets like agriculture and construction. Undocumented immigrants are quasi indentured servants. In order for the U.S. to close its doors and pull the drawbridge ten of millions of people would have to work in more physically demanding and labor intensive jobs than their accustomed to, willing to, and in many cases capable of.  Trump and millions of others romanticize labor intensive jobs like coal mining but actually desire comfortable white collar work for themselves and families. It is why the U.S. is the number one importer of goods. We like having others do the hard work. 

 

First off, interestingly instead of the usual quote this popup I got "Ask Cortana about the 100% true the U.S............."

I only got to quote this after I blew that off.

Effing computer programmers and American companies. 

 

Anyway I largely agree with what you said but point out that "past figures are no indicator of future performance in business"

 

5 hours ago, Ten oz said:

As a side effect builders will look to other building materials that is more cost effective

 

Why can't we call a spade a spade and say cheaper not cost effective?

As a matter of interest I was told many years ago and I watched this effect in my working life that there are fashion cycles in building g alternating between steel and reinforced concrete fabrication depending upon two factors.

1) yes "cost effectiveness"

2) The relative ascendancy of training (advertising) programs for the two materials. This latter has had a big effect.

[Phi for All]

23 minutes ago, studiot said:

Why can't we call a spade a spade and say cheaper not cost effective?

Because there is a difference between the cost of a good and how effectively it solves a problem at that price. An increase in the price of steel might make a more expensive but longer lasting alternative more attractive than it otherwise would have been. In the US, when gasoline reached $5/gallon in many parts of the country (2006-7? iirc), demand for electric cars soared because they were suddenly more cost-effective, not because they were cheaper.

[Sensei]

Quote

On Thursday Donald Trump said steel imports would face a 25% tariff and aluminium 10%.

The result of this action, will be that everything produced by USA which uses steel and aluminium will be more expensive in either internal American market and for export to world.

Costs of Boeing, and other airplane building companies, shipyards and shipbuilders will grow. Produced by them goods for export will be less attractive to buy for world customer.

If you have stock market account, you can bet on short-selling companies listed here:

https://en.wikipedia.org/wiki/List_of_shipbuilders_and_shipyards

 

Edited March 2, 2018 by Sensei

[Ten oz]

9 minutes ago, Sensei said:

Costs of Boeing, and other airplane building companies, shipyards and shipbuilders will grow. Produced by them goods for export will be less attractive to buy for world customer.

Boeing, Lockheed, BAE systems, Northrop Grumman, and many others have large contracts with the Department of Defense (DOD). Trump has already boosted DOD spending for the next couple years. DOD approves new contracts seemingly everyday. It is ironic/stupid but Trump just made all the military upgrades he wants more expensive ( perhaps that was the point).

 https://www.defense.gov/News/Contracts/Search/foreign/

 

[Strange]

Apparently Trump is now threatening to put a tarragon imports of cars from the EU: http://www.bbc.com/news/world-us-canada-43270388

[Butch]

Yeah, trade wars are great for reminding people that tariffs are stupid and money is only worth what is done to earn it.

On 3/2/2018 at 7:48 AM, studiot said:

I'm not sure about modern China, but I think the USA is still the only country in the world that, if it chose to close the doors and pull up the drawbridge, could obtain everything it needs within its own borders.
 

Isolationism is not practical even in a totalitarian regime! Much less so for a truly free and capitalistic society.

Trump and his advisors, as well as many in government elsewhere in the world will learn from this mistake.

[Sensei]

They want to collapse stock markets, because they already set up short-sell, to earn on it...

 

[geordief]

1 hour ago, Strange said:

Apparently Trump is now threatening to put a tarragon imports of cars from the EU: http://www.bbc.com/news/world-us-canada-43270388

Is that French tarragon or Russian?

[rangerx]

Canada has abundant resources, especially lumber and oil. America is upset because it's harvested and pumped from public lands. Yet, American agriculture is highly subsidized because much of it, including ranching is done on public land. The premise Canada "dumps" lumber on the market is ridiculous. It's profitable, not a loss. Countries produce things that other's don't, hence free trade is a benefit to everyone. Canada isn't needlessly hostile as to impose counter veiling duties on food to it's own people. If anything, welcomes Mexico under NAFTA to produce what Canada cannot, especially during winter months. Canada continues to be a leader in the production of grain to the entire planet.

Canada and America have an agreement on fish. Alaska catches BC fish and BC catches Washington and Oregon fish. They've co-operated for decades, but a trade war can only lead to destruction, especially in the absence of bilateral management policies. Abandoning the treaty would devastate the Pacific Northwest, at the cost of Canada and Alaska breaking even.

The controversial Keystone XL pipeline will invariably be a pipeline to nowhere if Canada increases it's sales to China or the next highest bidder. Western Canada has no refineries, but Texas does. Canada is already at a disadvantage, but supply compensates for it. It flies in the face of energy self sufficiency to alienate the source. Especially from a peaceful ally as opposed to oppressive regimes.

Canada has the potential to do to America, what America did to Mexico with water. Abolishing the Columbia River agreement would be devastating for America, whereas Canada's commitment to control floods in America would go out the window. It would actually save Canada a lot of money and open up more flow for hydro electric power than already in existence. Speaking of which, Canada sells hydroelectric power to California for less than it does it's own citizens. That will end if NAFTA is nuked. Either the price will hike, or the plug gets pulled. Either way, America loses and Canadians would enjoy the surpluses for both domestic and industrial use.

Canada has given up a lot to compensate for trade deficits. The Auto Pact, and aviation technology (Avro Arrow et al) come to mind, but there are numerous others. All of which were scrapped and gave rise to skyrocketing trade between the two countries under NAFTA. Imposing new tariffs on aircraft, steel and aluminum has doomed America to repeat that history.

[Ten oz]

@rangerx, As the Northern Passage opens to greater extents every year and the amount of land ice in Canada continues to shrink it seems Canada will eventually become a major port of call for international trade. It will be more cost effective for goods to reach North America via the Northern Passage. I think in the future the majority of goods destined for the United States from Asia and Scandinavia will come ashore in Canada. Because of that Canada is in a strong negotiating position with the U.S. with regards to trade.

[John Cuthber]

Just a thought re ""Trade wars are good""
Delete the word "trade", and think about it.