So basically China's stance is, we cannot change our laws so our bad trading practices must remain in place?
While we only get news of trade imbalances between US and China to include all their tariffs and restrictions can someone for the EU or elsewhere chime in with how their nations fare?
> So basically China's stance is, we cannot change our laws so our bad trading practices must remain in place?
China's, or better said Liu He's, stance is "we will not do anything if it has chance to blew into Xi Jinping's face"
Xi brandished how he tames "capitalist tigers" by wholly appropriating the credit for the trade deal. Now he is being made to look stupid with a single twiter post.
It is likely he will not touch the talks personally out of fear for more embarrassment
Liu He might be only a fourth vice premier in line, but only one Xi has personal ties to.
I feel like none knows how to deal with the Chinese, there's a cultural gap that the US and Europe are not accounting for, the Chinese care a lot about saving face and status
To me it feels like Trump did it more or less intentionally. He seem to know that behind a stone faced facade, Xi is an anxious and insecure person — the same 7th grader he was when his family was purged.
How could you not be anxious as a Chinese politician?
In Western democracies, if you lose political power at worst you get indicted (and usually pardoned). Half of the country still likes you.
In China, you face serious prison time, your family's assets are seized, you're expelled from politics, and media runs a solid month of anti-you propaganda.
Harsh consequences for what many times is a roll of the dice.
p.s. Could you please not routinely create accounts? That's not allowed here, except for occasionally when posting sensitive information. For more information on this, I've posted a bunch about it: https://hn.algolia.com/?sort=byDate&dateRange=all&type=comme...
I don't understand the hate Trump gets for doing what needs to be done. All these issues esp. theft of intellectual property, IP transfer, currency manipulation are much more important in the long term than some tarrifs.
One shitpost tweet crashed SZSC by 7%, most of China couldn't even read it. Trump is in a position of power at least with this negotiation.
I have to agree. And, while I will hate myself for this, but after Biden's statement that China is not a competition, who I will end up voting for in the next election is no longer given.
The US isn't going to do a 180 until a pro-business Republican or a Libertarian sits in the Oval Office, and its unlikely that will happen next cycle unless Trump dies or is impeached.
What policies? You, and everyone else, need to understand that Trump has no policies other than "BROWN BAD, MONEY GOOD, TRUMPY SHIT PANTS, TRUMPY WANT NEW DIAPER"
edit The Trumptards have woken up. Poor bastards must be grumpy their brainless dementia-addled fat fuck dicklicker isn't actually a billionaire.
Boo fucking hoo. Eat dicks and die. Not necessarily in that order.
there are some narrow interests that favor Trump tariffs.
e.g. the United Steelworkers Union:
"China ... dumps its excess aluminum and steel on the world market at super-discounted prices. The United States, in conjunction with European allies and others, has repeatedly over the past decade negotiated with China to stop defying the rules it agreed to abide by when it gained entrance to the World Trade Organization in 2001. China repeatedly has said it would. And then it doesn’t."
So the steelworkers, whose income relies on American production of steel, is butthurt because someone else makes steel.
Again.
Still.
This is not new. The steelworkers have been bitching about everyone and everything basically since Japan started making cars that weren't shit and releasing them in the US market.
Very similar story with the Obama tire tariff. $926,000 cost to consumers per job saved, plus the loss of 3 retail jobs due to consumers spending more on tires and less on other stuff.
As usual, when the government gets involved in the market and the economy, with a combination of incompetence and cow towing to special interest, it makes the situation worse.
I didn't say it was good for everyone. You said "The trade war isn't helping anyone." I only pointed out that some narrow interest groups favor it because it's helping them.
There are other inefficiencies in the US economy, jobs that are preserved or are high paying solely because existing laws limit competition, limit participation by potential additional workers, etc
The real issue here is not "Have these tariffs caused our economy to deviate from pure efficiency?" It's "Which special groups are allowed to have their own interests protected and extended by law and by government action?" This stuff is happening all over the economy.
> I couldn't find any mainstream, usually Republican leaning economists, magazines, or newspapers that said it was a good idea.
That's because tariffs aren't a traditionally right wing, "free market" position. This is actually an economic view that Trump shares with Bernie Sanders.
yep. that's what I see too. In addition, Sanders harshly criticized the TPP:
"The Trans-Pacific Partnership is a disastrous trade agreement designed to protect the interests of the largest multi-national corporations at the expense of workers, consumers, the environment and the foundations of American democracy. It will also negatively impact some of the poorest people in the world."
It isn’t costing consumers much. I run a company that was affected by the tariffs. If we had kept manufacturing in China, cost of goods sold (COGS) would have gone up by 25%. But COGS are only 50% of the price customers pay for our products. So the price increase to our customers would have only been 12.5%. But we didn’t keep our manufacturing in China, we moved it to Taiwan and Vietnam. As a result, our COGS went up by roughly 8% (prices are higher at our new factories), which works out to a 4% increase in prices to our customers. And our products have an unusually high COGS relative to most things consumers would buy at, say, Walmart. So the real impact of the tariffs to the prices most consumers are paying is in the very low single digits, percentage wise. Not really a big deal. Mostly the tariffs are/were very inconvenient for US business that manufactured in China.
Months ago, I saw an analysis done by a European financial firm. The burden of the tariffs is 83% paid by China. This is very well aligned with his example.
The burden we do pay isn't so bad. It can substitute for other taxes. We used to do this in a big way, funding the country without an income tax. The local employment is pretty good too. Those industrial jobs, for example steelworkers, are reducing income inequality.
If that supposed $900K comes from Jeff Bezos, owner of the Washington Post, I'm OK with it. In that case, he alone is worth a hundred thousand jobs. I can see why his newspaper might be complaining.
There are far bigger reasons to doubt it, so the "liberal media" issue is moot. Not that "liberal media" isn't a fine reason, but Jeff Bezos is literally the owner of the Washington Post. He also runs Amazon, shipping lots of Chinese goods. His bias is obvious.
This isn't even a political conflict along the liberal/non-liberal axis though, so Forbes doesn't change a thing. I'm sure you've heard of the uniparty, demipublicans, republicrats, and so on. The leaders of multinational corporations have a globalist mindset. Aside from desiring regulatory capture to suppress competition, they also have a libertarian mindset. Very few media sources and very few politicians break from either mindset by much, except some hot air from some politicians. Politicians don't last long if they anger the large multinational corporations.
There is almost nobody with interests aligned with the American worker. Of the few who are, many would admit to loving the tariffs only if somebody like Bernie Sanders had imposed them. Generally, all of those with a big voice (media and politicians) would gladly wipe out American jobs in exchange for greater profit. This is short-term thinking, ignoring the slow collapse of the nation and the changing balance of world power.
So there should be some studies somewhere that say the best way to brings jobs to America that in aggregate is beneficial is to impose tariffs and protectionism is to spend money on industries retraining workers?
Are you also in favor of laws in some states that don't allow people to pump their own gas to save jobs?
Mostly my point was about basic arithmetic: 25% sounds like a big deal, but consumers are not paying anywhere near an additional 25% on goods they buy because so much of the retail price of a good is made up of things other than production cost. That is something anybody who has run a business that sells goods can tell you, I was just using my personal experience to illustrate the point.
Reducing new borrowings and doing dramatic gestures to reduce debt? No, he is not doing that. US deficit shot up dramatically as giant loads of new t-bills went into circulation, and financial players got strong signal on US interest rates.
To reduce the trade deficit, the first thing to do is to reduce the fiscal deficit — a thing that has little to do with trade.
What would you do if you were going to perform an audit of the Federal Reserve?
Lets say that the Fed has not been exactly lawful with the way they sling money. And you know it because you've put someone in charge that could take a look. So you have the justification for shutting it down. Wouldn't you max your "credit card" out if you knew you were going to be able to cut it up?
Trump knows debt better than anyone on this planet. Don't let him fool you.
Perhaps you can understand it better if you ask yourself if he and his administration is actually capable of achieving anything. Did his tweetbluster and love for Kim denuclearize the Korean Peninsula? Did his wall or child caging stop immigration? Did his repeal of parts of the ACA give people "the best health coverage"? Did his Muslim travel ban stop terrorism and make America safer? Did Jared bring peace to the middle east? Did his constant slagging of NATO and the EU make America stronger? Are you starting to see a pattern?
I don't really know what your comment has to do with the Trade dispute?
What do we do about a Chinese Government that is responsible for the largest transfer of wealth in human history through theft of western IP and Technology? Do we just keep doing business as usual and ignore the unfair trade practices and forced technology transfers? Do we ignore Muslim Internment camps, slave labor, political oppression, etc?
So what do you think? Should the USA capitulate, what's your plan?
Some of the stuff he talks about are legitimate issues that need to be fixed. He's just so superficial with his changes that none of the problems get fixed. In some cases he just exacerbates the problem.
I personally feel people dismiss these issues because trump talks about fixing them. They seem to think admitting a problem trump is talking about is real means they support trump. That's absolutely crazy. Then again Republicans did the same with Obama though.
It's almost taboo to think the world should not be looked at either from a left or right perspective. Truth is what the party tells you.
Please try not to flamebait, particularly with political topics, on HN.
Aside from the actual topic at hand — China — the big pillars of Economic growth, immigration, healthcare, North Korea, the Middle East, national security, ISIS, and NATO are all massive issues that US continues to struggle with and has for decades (well, ISIS is a recent spinoff of an older problem).
Trump has set a great direction in Iraq/Afghanistan (get the hell out). Trump has worked marvels with Kim (when was the last nuclear test?). Trump made great strides in recognizing the truth on the growth with the embassy move to Jerusalem and judging by the latest hystrionics by Hamas might be zeroing in on the greatest deal of his life in the Middle East. Trumps purpose with the travel ban was forcing better intelligence/screening of incoming passengers and we’ve got the data sharing he wanted. NATO countries are paying more than ever. The ISIS caliphate is defeated.
Immigration reform and healthcare he has fought hard battles and wants to keep fighting. There’s recent progress on the great DACA bargain. Trump wants to get true historic immigration reform on that list, and he continues to push for a real Republican answer to healthcare while chipping away at the margins for things like drug pricing.
Oh yeah, and the economy has literally never been better, and never been better for everyone across the income scale. He fought the Fed hard to ensure real wages would rise for the low and middle class when they tried to squash it with rate hikes.
Trumps strategy with China is sound (despite the talking heads all saying tariffs don’t work) and he had the leverage going into this negotiation to get important concessions.
All this, while the whole time being called a Russian traitor from across the aisle. Crazy times we live in.
I find it quite amusing that holding somewhat banal, mainstream, well-accepted and factually-sound opinion (ie, "The Trump administration is incompetent and his policies cannot and have not achieved their stated end goals"), is enough to be considered a flamer, troll etc. Don't worry, you're not the weird one - I got reprimanded by dang for essentially paraphrasing Masha Gessen's writings in The Atlantic. Wow, what a rebel I am!
When a place that exists to "gratify one's intellectual curiosity" is so unable to deal with mainstream opinion, we are living in crazy times indeed.
I think the underlying question is whether you’re trying to score points or engage in honest intellectual inquiry and debate. The pile on of many massive long-standing world problems and the notion a person is going to “solve” them seems to indicate it’s more a post meant to provoke than to invite civil discussion.
I don't know if the depiction here displays all the nuances that's being described:
(Minor edit: I want to emphasize I'm not trying to challenge for any political chargement, even though this is a politically charged area. I'm mostly interested because this is drastically different from my understanding, and believe this is an educated viewpoint from different sources that I lack in my life. I'm looking to be appropriately enriched by being informed of other information I've been left ignorant on.)
> Trump has set a great direction in Iraq/Afghanistan (get the hell out).
This has concerns about leaving (yet another) power gap, no?
> Trump has worked marvels with Kim (when was the last nuclear test?)
Didn't Kim absolutely walk away from the most recent meeting with Trump with absolutely no deals made whatsoever?
> Trumps purpose with the travel ban was forcing better intelligence/screening of incoming passengers and we’ve got the data sharing he wanted.
I didn't know that increased surveillance was a good thing. Also, if his was to increase surveillance it disrupted a lot of people's lives, careers, etc. I don't know if that was the best strategic way to go about this given other, less-disruptive manners.
> NATO countries are paying more than ever.
Why is this a good thing?
> The ISIS caliphate is defeated.
Is this attributable to Trump?
> Trump wants to get true historic immigration reform on that list
What is that historic immigration reform specifically? I hear stuff about separating families at the border, children getting 'lost', and biometric screenings to verify families. Is that the reform? Is there reform I haven't heard about from the MSM?
> continues to push for a real Republican answer to healthcare while chipping away at the margins for things like drug pricing
I thought the Republican answer was to repeal ACA, which makes healthcare deniable to people with pre-existing conditions again, among other things. What are other proposed solutions?
> the economy has literally never been better, and never been better for everyone across the income scale
Is this attributable to anything Trump specifically did? I agree this is good, but I'm not sure if this is something Trump did. I'm not an economist, btw!
> Trumps strategy with China is sound (despite the talking heads all saying tariffs don’t work) and he had the leverage going into this negotiation to get important concessions.
We're going into an article where China is actually not giving any concessions and in fact has reneged on almost all of them. So I'm... confused?
If you have sources I'd love to be educated since you seem to have much greater insight into this than me, and are getting different conclusions than I am, possibly because my sources are not covering the things your sources are! Could you tell me where you're getting your sources? Thanks.
1. It’s not that leaving Afghanistan (and Iraq, and Syria) doesn’t have a single downside. But I am very much in favor of getting out anyway. We can’t afford to keep spending on the order of $2.5 trillion dollars for a part of the world which is increasingly irrelevant as the US has become oil rich and indeed the world’s biggest oil producer — achieved under Trump by the way. Trump is very much anti-interventionist and wants the US to focus inward on building up our own country. Despite great ideals for spreading democracy, the US has a poor track record in the past.
[We should be using less oil every year, but as much as possible it should be US oil (we have to trade for varieties of oil that our refineries are setup to make gas from).]
2. We do not have a peace treaty with Kim, but relations are still markedly improved, particularly between North and South Korea. Kim was threatening to nuke Guam not that long ago, and testing missiles and underground nukes constantly. We’ve stepped back from the precipice. Kim walking away is part of the negotiating. Even if Trump is ultimately not 100% successful, his hard line and hard charging rhetoric still accomplished a lot with North Korea and didn’t give up anything.
3. Information sharing on who is coming into the country is essential for TSA to do their job. They need more than just the basic passenger manifests to know about who is traveling. This isn’t about illegal mass surveillance but basic systems we already had in place for many countries which were missing from even higher risk countries.
Trump absolutely uses disruption as a tool to effect rapid change. It’s impossible to know if he could have forced the countries on the travel ban list to put the systems in place without the ban to force action.
4. Yes, NATO is crucially important and the US is paying more than our fair share. There is a specific % of GDP countries are expected to pay and the US far exceeds it.
5. If ISIS was thriving you bet that it would be Trump’s fault. Generally the President at the time gets the blame and the credit for the result of wars, being the Commander in Chief.
6. Specifically Trump wants to stop incentivizing illegal immigration by closing loopholes like Catch and Release at the border, as well as increased border security, to disincentivize people and especially families from attempting the trip. Bringing a child along should not be a free ticket to remain if you are merely an economic migrant.
The media called it a manufactured crisis because they don’t want to talk about bad policy incentivizing dangerous behavior which is leading to a humanitarian crisis. The border is totally inundated with illegal immigrant families coming over, and those people need to be processed and accounted for even if you are going to turn around and just release them into the interior.
7. The Republican plan was always stated by Trump as repeal and replace. The Republican platform does stand for protecting pre-existing conditions. There are a lot of things that are not great about ACA, mostly around Medicaid expansion and how the credits work as effectively one of the biggest tax increases on the middle class ever. By the way, it is problematic if you protect pre-existing conditions to the point where someone doesn’t need to buy insurance until they get sick. ACA tried to prevent this with enrollment periods, but it can be gamed.
8. On the economy there are a massive number of things Trump has done. The biggest and most visible was going to war with the Fed when they badly misjudged with rate hikes. But slashing regulation mainly, and the tax cuts, played a big part.
9. Back to China, notably, Lou He did not cancel his trip. It’s too early to call, but past approaches have absolutely failed and the China markets took a much bigger hit after the new tariffs news came out than the US. IMO China will only respect a hardline negotiator who they know can and will use blunt instruments to force them to make concessions. I don’t kn...
Letting good things continue is just as important as making bad things stop.
Obviously the US produced oil before Trump. But oil production has increased remarkably in the last couple years, and support for expanded drilling access and pipelines is a part of that. Agreed, for better or worse. It’s hardly controversial that Trump is pro domestic oil production. Just look at Bolton’s comments at the recent Arctic summit!
Oil could increase more under a Trump presidency than any other in history. Certainly under a barrel/mo basis if not also as a percentage increase YoY.
Your cited graph is hardly definitive. A long period of stagnation followed by hypergrowth, reconciliation in 2015, and then more hypergrowth.
I asked primarily where you’re getting these sources of information from, as the sources I get from come from a distinctly different conclusion which is confusing to me.
theres a lot of reasons for someone to look at both what and how trump is approaching this, and rationally come away less-than-enthused:
1. Poor execution & personnel at odds with each other leaking play-by-play details has led to a lot of market fluctuation and difficulty for the market to price in the "real world". Anyone exposed to this gets a first hand look at the monetary cost of this.
2. Real impacts of the tariffs felt by american manufacturing & farmers as well as american consumers. If trump wanted an extended trade war he should have been much more upfront with people & prepared to cushion it. You say it's "some tariffs" but this minimizes real household struggles.
3. General impacts of "losing the people". He's a highly polarizing leader; anywhere from beat street to wall street to pennsylvania ave, people who don't get along with others will find it very difficult to be trusted on any given issue even when they're right. This is a near-constant in life, some people manage to be a net-benefit with that attitude but it's usually by leaning on other crutches like being highly gifted. Trump isn't that person.
None of which has anything to do with Trump's policies and, in fact, these numbers would improve if the fuckbag Republicans would all spontaneously die and leave the actual adults to their work.
2018 was not a great year on the markets (regardless of feel-good business confidence in 2018), farms & manufacturing are getting killed by the tariffs. Your facts & my facts coexist in the real world.
Presidents (of both parties) like to take credit for those kinds of economic results. In reality the federal reserve and what they are doing with interest rates and the money supply is mostly responsible for economic cycling, not the president.
This is not correct. My profession put(s) me in a position to work directly with CEO's nationwide. Trump's election and his policies moved these folks to invest in people, plants and equipment. Fed policy had nothing to do with it. Believe what you will, but I'm relaying to you the ground truth.
> China deserves the pain train for backpedalling.
Fine, I'll accept your premise here. Now, on the flip side:
Why do I deserve "the pain train" for what's happening with China? Why should I and others I know suffer for this?
> I don't understand the hate Trump gets for doing what needs to be done.
Because things for me were good before, and now they are less good as a direct result of things he's doing. Trump isn't doing anything to alleviate that, and if he is, I'm not seeing the results.
Finally, he serves me, so I have every right to demand results. He made lots of promises, and he's failed many of them already.
So answer my questions. Especially with the context of him not saying we'd have to suffer for his failures.
I am with him on this issue but I have strong doubts about him being able to find a resolution. When I look at the North Korea situation, his health care “plan” and other issues he seems to like going in and talk tough but in the end he gets nothing done. I wouldn’t be surprised if at some point China would flatter Trump with some nice words and then Trump would declare “I love China” and forget about the whole thing.
In the long perspective the Chinese market is the larger one with more people. Currently it makes sense for the US to be protectionist, in the long run the US market is smaller and Chinese companies will benefit from the larger Chinese market.
This played out over 50y with the fragmented European market vs. the larger homogeneous US market. Starting in the US was (is) much more beneficial than starting in Europe (the language and culture issue here will never go away even when policy is more and more unified).
"The reason for the China pullback & attempted renegotiation of the Trade Deal is the sincere HOPE that they will be able to “negotiate” with Joe Biden or one of the very weak Democrats, and thereby continue to ripoff the United States (($500 Billion a year)) for years to come... Guess what, that’s not going to happen! China has just informed us that they (Vice-Premier) are now coming to the U.S. to make a deal. We’ll see, but I am very happy with over $100 Billion a year in Tariffs filling U.S. coffers...great for U.S., not good for China!"
There are very real problems with how China treats foreign companies (intellectual theft, requirements to partner with Chinese companies and many more). I'm happy they get addressed. However, Trump completely misrepresents the problem and the impact of tariffs. The negotiations clearly are tackling the right issues, yet here he is talking about trade deficits as some kind of theft and tariffs as a straight up win like some moron who doesn't get econ 101. He is doing his (for once) good effort such a disservice. Is he trying to divide the country by even representing his good work in a way that will only appeal to his hardcore supporters or does he truly not get it? Is there a more charitable explanation?
Edit: I also have very sour memories of Obama complaining about the trade deficit with Germany. In that case none of the real issues like we have doing business with China existed. In essence Obama was complaining about German companies being too successful and Germans saving too much money. Maybe I'm particular sensitive to trade deficit rhetoric because of that. If the passing field is level, then maybe the deficit is the fault of the country that has the deficit. In this case the playing field is very skewed and that's the problem.
“Trade deficit” is what his voter base “understands” and it sounds scary so it would make sense to peddle this to them even though it has nothing to do with real issues. But then again it’s trump so who the fuck knows why he does it...
> “Trade deficit” is what his voter base “understands” and it sounds scary so it would make sense to peddle this to them even though it has nothing to do with real issues.
I assume you implicitly are saying that they also don't understand the harm a trade war also does to the American economy? Regardless....out of curiosity, how did you come to know the details of what Trump's base thinks at such a detailed level?
edit: Also out of curiosity, why would someone downvote this? Does it not seem like a perfectly fair question (if you set your politics aside and think about it logically, something that used to be the overwhelming norm on HN)?
Does his understanding matter? If Mnuchin and Lighthizer are hitting all the right notes in the negotiation, does it matter if Trump understands any of it? Let him bluster and take credit for Mnuchin and Lighthizer's good work.
The problem is that his communication is what's most visible and it's misrepresenting his administration's good work. It would be good for the country to at least be unified on some issues. Yet this gets presented in a way where we again can't even agree on the problem.
His style of talking is to use simple terms even to the extent of sounding stupid to let the messages go across clearly. Trade deficits being neutral or slight bad is a niche view by a some economists. Most people view trade deficits as bad, rightly or wrongly. The word deficit, loss, and inbalance all have bad connotation. And the loss is huge, adding to a dramatic effect. He's trying to justify his action to his voters. Why won't he use trade deficit reduction as a goal?
Also balanced trade would be better than trade deficit, so it's a worth goal to achieve.
If the market was fair, then it's the US's fault to not make more attractive products and buy tons of stuff from China. It wouldn't be China's fault that they are successful and we are not. It would be like Obama bitching about Germany that I mentioned above. But that's not what's going on here. China is playing unfairly.
If the trade with China is discriminatory, he should call that out and not whine about a trade deficit, which can have many reasons (like US products might be bad or US consumers consume too much)
The link you provide only mentions high testing standards and even specifically calls out that they don't get applied in a discriminatory way. Can you elaborate more?
The import tariffs are paid by the people inside the importing nation.
A US import tax on Chinese goods is a tax on American consumers and manufacturers.
The way to tax China itself would be an export tax on money bound to China, including the transfers of immobile or intangible assets to Chinese nationals or corporations via domestic exchanges or brokerages--and including the cash value of transferred intellectual property.
Imports are paid for by exports. If you're worried about a trade imbalance, you could always say that the other nation can keep sending more goods if they want, but we'll only pay for them with trade goods and services, not with cash, or ownership of land and capital.
Another way to wipe out a history of past trade imbalances would be to announce the retirement of the domestic currency, citing counterfeiting or hacking, hyperinflation, or whatever else that may sound plausible.
You then allow only your own nationals to exchange old money for new money. In order to avoid losing all of the value of their old money, foreign holders would have to buy something from a domestic person, who could then exchange the currency.
A smart exchanger would then either keep the new cash, or buy back their sold things at a lower price. In effect, it ends up being a one-time tax on domestic currency being held abroad. Any country that had been building up a reserve of your currency via trade deficits either has to settle up immediately by importing a giant bolus of your trade goods, or it gets screwed.
Only the rich ones. The citizens who have their debts devalued, and whose assets are mostly in residential real estate, would see it as a fortunate advantage.
What's the benefit of having reserve currency status?
US States have right and left been legalizing precious metals for currency this last year, perhaps in preparation for a return to the gold standard and dumping federal reserve notes after an audit of the federal reserve...
> What's the benefit of having reserve currency status?
You get to print absurd amounts of money without significant inflation because every other nation in the world hoards your currency because it’s the de facto standard for trade. US dollar stability owes a lot to the fact that everyone else holds a ton of dollars.
> US States have right and left been legalizing precious metals for currency this last year...
It’s never been illegal to trade precious metals for goods or services. Precious metals may not be legal tender but no one has been prevented from using them as currency.
To the extent that some states may make gold or silver coins legal tender, it’s just pandering to conspiracy theories and paranoia. In the event that the dollar collapses, having gold as an alternative legal tender does nothing. Anyone saying otherwise is either lying or ignorant.
If someone owes you $1300 dollars, having gold as an alternative legal tender doesn’t help you if the dollar collapses. The person owing you is absolutely not going to go find a Troy ounce of gold coins to pay you. They’re going to happily pay you the $1300 they owe you in devalued US dollars. And you’ll accept, because that’s what legal tender means.
Taxes on transactions, such as tariffs, are almost never paid only by one side. The side with less flexibility is going to pay most of it, adjusting prices as needed to make this so.
China has less flexibility. Idled factories are a huge problem, and there is no other buyer as large as the US. It is relatively easier for the US to buy elsewhere, both abroad and domestic.
About 83% of the tariff burden is getting paid by China. (analysis by European financial firm)
Even the part we do pay isn't all bad. It reduces the need for other taxes. It supports American workers, reducing income inequality.
Seems things are going far better in this little trade war than I was expecting. If the 17% paid by US consumers displaces other taxes, that's a huge net gain.
> The import tariffs are paid by the people inside the importing nation.
While that's technically true, the tariffs have the effect of increasing the price of goods, so the exporter may need to lower their price and drop their profit margin to remain competitive.
> The way to tax China itself would be an export tax on money bound to China, including the transfers of immobile or intangible assets to Chinese nationals or corporations via domestic exchanges or brokerages--and including the cash value of transferred intellectual property.
That's an interesting idea, but doesn't the US Constitution ban export taxes?
It bans taxes on "articles exported". Banknotes, shares of stocks, bonds, title to real property--these are arguably not "articles".
You couldn't tax a crate of polypropylene combs going from Chicago to Shenzhen. You might be able to tax the sale of 100 shares of stock in Acme Unbreakable Combs, Inc. to Chan Jingwei of Shenzhen on the Nasdaq exchange. Maybe tax the transfer of technical plans and patent rights for a comb-making machine from AUC Inc. to Acme Shenzhen Manufacturing, a Chinese corporation. And you might be able to tax the sale of a Seattle 4000-sqft 5-bedroom house to Mr. Chan.
In all those cases, you're not moving goods, you're moving ownership.
Someone would have to enact a law establishing an export tax first. As far as I am aware, you can't challenge a law as unconstitutional until it has been passed and signed.
A 25% tariff results in low-singe digits % price increase at in the store. The tariffs are on cost of goods, but cost of goods is usually a fairly small fraction of retail price.
Most families don't spend all that much money on stuff manufactured in China. Family budgets are largely comprised of rent/mortgage, food, and transportation. Then you have clothing and household goods, some of which is manufactured in China. So we're looking at a 5% increase in a small fraction of a family's monthly budget. As a point of comparison, families regularly weather much larger fluctuations in their monthly budget due to changes in the price of gasoline.
China is playing the old game, negotiation and negotiation and negotiation, never intend to make any change. They can even make promise to make changes after long long long negotiations and never do anything. And then when someone finally decide to do something about it, they will ask for a new round of negotiation and negotiation and negotiation.
Incorrect. The tariffs are costing Chinese businesses and the government greatly. There is some other benefit to this that isn't explained by negotiation tactics. Although I cannot rule out a total misread of Trump by China, due to poor analysis, intelligence or misinformation.
I suspect Xi wants this dispute to continue for internal Chinese reasons. The tariffs impact different sectors and regions in China differently. It may be continued tariffs are reducing overcapacity in a manner that allows Xi to save face internally. It could be the tarrifs are breaking the back of powerful exporting provinces (eg. Jiagnsu) and helping Xi consolidate power. It may also be the case that things need to get much worse in China economically before Xi has a strong enough argument to persuade the Chinese military (a powerful economic force itself) to embrace a deal. Finally, the success of the Belt&Road strategy requires a shift from US/Western export to vast investment elsewhere; and it may be the case these tariffs provide the Chinese private sector a strong incentive to open new markets and long-haul decrease reliance on the US. Its complicated. I suspect a deal will be reached in 2-4 months.
I don’t know how by cutting down exports Xi plans to consolidate power? Could you please expand on the mechanism by which this could happen? Tariffs are breaking backs of exporting provinces, may be they could be ill informed and Chinese propaganda can spin this to blame US.
Suffering constituencies (provinces, cities, banks, businesses) may have to make substantial concessions to Xi's leadership team/faction to obtain relief. Those concessions may be up front, or favors owed to be collected in the future. Politics 101.
This is a feature of the US administration's approach to negotiation, driven by various motivations. China is not without leverage, and the US will blink first.
None of the politics above implied involvement with the public; the public are generall a periphery in this discussion and possibly a detriment to inform the public too much about the details of what's going on, which would allow the public to speculate and make their own decisions.
How will that work? I only see them increasing the overcapacity as the market for commodity stuff gets even smaller
> success of the Belt&Road strategy requires a shift from US/Western export to vast investment elsewhere;
China had almost 20 years to do so, but Chinese companies were blindly charging ahead into US market. Only very recently, the business community began to realise that the rest of the world is "not so bad" business-wise." Xiaomi and BBK brands were a hit in India, but their C-levels ignored India up until they were almost buried in money from Indian market.
Xi is being publicly called out by Trump. He cannot fold because the Chinese people are at least as patriotic and nationalistic as your average American.
Instead of making this a civilised conference resolving trade issues its a pissing match between two superpowers. This is exactly the situation that the EU has tried to avoid with its own dealings with these two alpha male gorillas.
If we were dealing with rational countries here there would indeed be a deal. But this isn't a trade dispute between the Netherlands and Switzerland.
If being irrationally angry and unpredictable was such a bad strategy, it wouldn't be so widely deployed. Being an unpredictable tyrant can be extremely effective, most especially against people who are unfailingly polite and civilized. The Kim family (of North Korea) has made excellent use of this strategy, for instance.
That makes more sense to me than this whole "China is waiting for the US elections" stuff.
China pushing back publicly (rather than making a deal and then ... simply not following through) against the US doesn't play well in the US as far as getting someone they want elected. Americans hurting economically are the folks cheering on Trump to some extent (well a vocal portion) and aren't likely to back a deal that isn't perceived to be favorable.
If the administration in China is playing an internal game, that makes a lot more sense than trying a potentially very counterproductive play in the US.
Related to this and the censorship story already on the front page:
China is censoring internal news about these trade controversies. From family over there I know that the general public isn't seeing this on TV or anything. And even messages on WeChat are being taken down (my wife has had several private postings removed)
I don’t know why and I am not a Chinese citizen but this kind of thing bothers me deeply. I hope Streisand effect takes over China in a self-propelling feedback loop until this whole show comes crashing down. People of China deserve better (once they’re a solid middle class and taken out of poverty).
Countries have emerged out of poverty even with strong democracies. I'm not sure why the world thinks that a strongman regime like the CCP is needed for economic growth.
In that sense, China is (IMHO) actually an outlier, an exception where a Communist regime used fully capitalistic economic policies and foreign investment to bring people out of poverty. This could have happened even if there was a different form of government there.
https://weibo.com/ttarticle/p/show?id=2309404369575977348865 This is from People' s Daily (the most official state-owned paper) on Sina Weibo (Chinese Twitter) in the early morning of May 8th, the most popular social media in China, and the commentator of this article is believed to be the direct voice from the politburo, the highest leadership of CPC.
Added: I really do not know why so many people are claiming that this piece of news have been censored in China, I saw the coverage at noon on May 7th on many mainstream medias, and every move from the U.S were also reported, along with every response from the press briefing of Chinese diplomat department. The latest coverage of it is also from People' s Daily about China' s retaliation response: https://weibo.com/2803301701/HtiphBxKZ , it was referenced and reported by all major mainstream medias i follow, so what did I miss?
My comment was based on lack of reporting up to the morning of May 7 (i.e., yesterday evening to us), when family were still saying they'd seen nothing. So maybe they decided to lift the embargo at noon as you said.
But even with that, it doesn't change the removal from WeChat private messages that my wife experienced as recently as over last night.
CCP is wise enough to know such news cannot be censored and censoring it only creates chaos and panic, my guess is it was struggling how to respond. CPC does censor the debates about it, but from it started in last year till now, every development has been reported by the official press, it has been laid low about the deal and prepared for the worst scenario, the news about the negotiations are always simple description of the events, but it never covered up any development.
Maybe China was just playing time and trying to time the trade conflict.
US elections are next year. If the trade war escalates this summer, the effect on voters and the US economy will be hardest 6 to 12 months from now. After that the US economy will start to adjust for the new normal.
Concerns about China though aren't likely to change.... I'm not sure voters will feel like "We need to strike a deal with China" ... and accordingly I'm not sure it is so much a Chinese advantage.
If things are worse, voters could be just as angry and willing to vote for someone who wants to fight ... more with China over trade.
This could be a case where China might want to stoke a problem, and get more blowback than they otherwise would have. The current POTUS (elected dude to a lot of things including economic concerns by some voters) has already proven you can put up a fight and the sky doesn't fall... and a politician might not see making a deal advantageous to China as a good political move, or even likely to produce a lot of economic benefit.
How, exactly, do you envision the US economy being damaged by a trade war with China? As far as I can tell, the effects thus far have been basically nil. Whereas things are looking pretty bad in China at the moment...
Markets and population are not one to one. One very dedicated, idealistic and pious person can do more today than the rest of 7 billion people combined. What's desperately needed is to elevate the debate and put all issues on the table:
China's leaders can misspeak. Why should they tell others how to speak? China's leaders cannot disarm their enemies. Why should they try to disarm yours? If people could go to China or Russia without having their businesses raided by the police just for being good at what they do and employing people, who cares who's rich or poor?
Go high enough on the wealth ladder, and it's almost comical about how real wealth lives. Super frugal, much simpler than the trap of material wealth and celebrity everybody presumes.
Until you find and build paradise, you have very little credibility in telling other people what to do from far far away.
Oh quit the fear mongering. He clearly states in the tweet they're referencing that the hope is the next administration will be a democrat, and they are trying to hold out for that.
I think this is a very strange development. I'm a bit surprised they would backtrack at all.
Rather in the past they've agreed to various regulations and laws and ... just not enacted or simply enacted and not followed them. That last part being the real question in all these details, does it matter if a deal gets made anyway?
If anything the traditional route would have allowed the POTUS to declare victory and everyone just move on, but this is far more confrontational and unusual based on my understanding.
Another year and a half is a long time to make your people suffer. And a lot of the supply chains that moved out of China might not come back. Waiting is a hell of a gamble.
I'm not sure a year and a half of unfavorable trade means much to a dictator who declares themself dictator for life, imprisons millions of citizens in re-education camps and engages in mass censorship.
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[ 52.3 ms ] story [ 2748 ms ] threadWhile we only get news of trade imbalances between US and China to include all their tariffs and restrictions can someone for the EU or elsewhere chime in with how their nations fare?
China's, or better said Liu He's, stance is "we will not do anything if it has chance to blew into Xi Jinping's face"
Xi brandished how he tames "capitalist tigers" by wholly appropriating the credit for the trade deal. Now he is being made to look stupid with a single twiter post.
It is likely he will not touch the talks personally out of fear for more embarrassment
Liu He might be only a fourth vice premier in line, but only one Xi has personal ties to.
In Western democracies, if you lose political power at worst you get indicted (and usually pardoned). Half of the country still likes you.
In China, you face serious prison time, your family's assets are seized, you're expelled from politics, and media runs a solid month of anti-you propaganda.
Harsh consequences for what many times is a roll of the dice.
https://news.ycombinator.com/newsguidelines.html
p.s. Could you please not routinely create accounts? That's not allowed here, except for occasionally when posting sensitive information. For more information on this, I've posted a bunch about it: https://hn.algolia.com/?sort=byDate&dateRange=all&type=comme...
Reminds me of a lot of corporations. “This doesn’t make sense but it’s policy”. Never mind that they wrote the policy themselves.
Yeah I've heard that plenty over here in the US.
One shitpost tweet crashed SZSC by 7%, most of China couldn't even read it. Trump is in a position of power at least with this negotiation.
China deserves the pain train for backpedalling.
This is one of those cases and his tweet is correct, they can just wait this out until the next election after someone new gets in and we do a 180.
No. Chuck Schumer, one of Trump's major political rivals tweeted this in response his tweet on tariffs:
> Hang tough on China, President @realDonaldTrump. Don’t back down.
> Strength is the only way to win with China.
https://twitter.com/SenSchumer/status/1125143336837206016
The US isn't going to do a 180 until a pro-business Republican or a Libertarian sits in the Oval Office, and its unlikely that will happen next cycle unless Trump dies or is impeached.
edit The Trumptards have woken up. Poor bastards must be grumpy their brainless dementia-addled fat fuck dicklicker isn't actually a billionaire.
Boo fucking hoo. Eat dicks and die. Not necessarily in that order.
Just a quick search, I couldn't find any mainstream, usually Republican leaning economists, magazines, or newspapers that said it was a good idea.
"China ... dumps its excess aluminum and steel on the world market at super-discounted prices. The United States, in conjunction with European allies and others, has repeatedly over the past decade negotiated with China to stop defying the rules it agreed to abide by when it gained entrance to the World Trade Organization in 2001. China repeatedly has said it would. And then it doesn’t."
http://inthesetimes.com/working/entry/21027/union_steel_tari...
Again.
Still.
This is not new. The steelworkers have been bitching about everyone and everything basically since Japan started making cars that weren't shit and releasing them in the US market.
Adapt or die.
https://www.washingtonpost.com/business/2019/05/07/trumps-st...
http://www.aei.org/publication/2009-tire-tariffs-cost-us-con...
There are other inefficiencies in the US economy, jobs that are preserved or are high paying solely because existing laws limit competition, limit participation by potential additional workers, etc
The real issue here is not "Have these tariffs caused our economy to deviate from pure efficiency?" It's "Which special groups are allowed to have their own interests protected and extended by law and by government action?" This stuff is happening all over the economy.
That's because tariffs aren't a traditionally right wing, "free market" position. This is actually an economic view that Trump shares with Bernie Sanders.
"The Trans-Pacific Partnership is a disastrous trade agreement designed to protect the interests of the largest multi-national corporations at the expense of workers, consumers, the environment and the foundations of American democracy. It will also negatively impact some of the poorest people in the world."
https://www.sanders.senate.gov/download/the-trans-pacific-tr...
And Trump seems to have agreed with that as well.
Brilliant.
So you’re generalizing your experience from a “company you run” to a country with a $19.39 trillion GDP....
The burden we do pay isn't so bad. It can substitute for other taxes. We used to do this in a big way, funding the country without an income tax. The local employment is pretty good too. Those industrial jobs, for example steelworkers, are reducing income inequality.
https://www.washingtonpost.com/business/2019/05/07/trumps-st...
In that case what about Forbes?
https://www.forbes.com/sites/ikebrannon/2018/07/02/steel-tar...
This isn't even a political conflict along the liberal/non-liberal axis though, so Forbes doesn't change a thing. I'm sure you've heard of the uniparty, demipublicans, republicrats, and so on. The leaders of multinational corporations have a globalist mindset. Aside from desiring regulatory capture to suppress competition, they also have a libertarian mindset. Very few media sources and very few politicians break from either mindset by much, except some hot air from some politicians. Politicians don't last long if they anger the large multinational corporations.
There is almost nobody with interests aligned with the American worker. Of the few who are, many would admit to loving the tariffs only if somebody like Bernie Sanders had imposed them. Generally, all of those with a big voice (media and politicians) would gladly wipe out American jobs in exchange for greater profit. This is short-term thinking, ignoring the slow collapse of the nation and the changing balance of world power.
Are you also in favor of laws in some states that don't allow people to pump their own gas to save jobs?
> Mostly the tariffs are/were very inconvenient for US business that manufactured in China.
Reducing new borrowings and doing dramatic gestures to reduce debt? No, he is not doing that. US deficit shot up dramatically as giant loads of new t-bills went into circulation, and financial players got strong signal on US interest rates.
To reduce the trade deficit, the first thing to do is to reduce the fiscal deficit — a thing that has little to do with trade.
Lets say that the Fed has not been exactly lawful with the way they sling money. And you know it because you've put someone in charge that could take a look. So you have the justification for shutting it down. Wouldn't you max your "credit card" out if you knew you were going to be able to cut it up?
Trump knows debt better than anyone on this planet. Don't let him fool you.
What do we do about a Chinese Government that is responsible for the largest transfer of wealth in human history through theft of western IP and Technology? Do we just keep doing business as usual and ignore the unfair trade practices and forced technology transfers? Do we ignore Muslim Internment camps, slave labor, political oppression, etc?
So what do you think? Should the USA capitulate, what's your plan?
I personally feel people dismiss these issues because trump talks about fixing them. They seem to think admitting a problem trump is talking about is real means they support trump. That's absolutely crazy. Then again Republicans did the same with Obama though.
It's almost taboo to think the world should not be looked at either from a left or right perspective. Truth is what the party tells you.
Welcome to US politics. It’s very sad that a lot of people buy into this.
Aside from the actual topic at hand — China — the big pillars of Economic growth, immigration, healthcare, North Korea, the Middle East, national security, ISIS, and NATO are all massive issues that US continues to struggle with and has for decades (well, ISIS is a recent spinoff of an older problem).
Trump has set a great direction in Iraq/Afghanistan (get the hell out). Trump has worked marvels with Kim (when was the last nuclear test?). Trump made great strides in recognizing the truth on the growth with the embassy move to Jerusalem and judging by the latest hystrionics by Hamas might be zeroing in on the greatest deal of his life in the Middle East. Trumps purpose with the travel ban was forcing better intelligence/screening of incoming passengers and we’ve got the data sharing he wanted. NATO countries are paying more than ever. The ISIS caliphate is defeated.
Immigration reform and healthcare he has fought hard battles and wants to keep fighting. There’s recent progress on the great DACA bargain. Trump wants to get true historic immigration reform on that list, and he continues to push for a real Republican answer to healthcare while chipping away at the margins for things like drug pricing.
Oh yeah, and the economy has literally never been better, and never been better for everyone across the income scale. He fought the Fed hard to ensure real wages would rise for the low and middle class when they tried to squash it with rate hikes.
Trumps strategy with China is sound (despite the talking heads all saying tariffs don’t work) and he had the leverage going into this negotiation to get important concessions.
All this, while the whole time being called a Russian traitor from across the aisle. Crazy times we live in.
When a place that exists to "gratify one's intellectual curiosity" is so unable to deal with mainstream opinion, we are living in crazy times indeed.
(Minor edit: I want to emphasize I'm not trying to challenge for any political chargement, even though this is a politically charged area. I'm mostly interested because this is drastically different from my understanding, and believe this is an educated viewpoint from different sources that I lack in my life. I'm looking to be appropriately enriched by being informed of other information I've been left ignorant on.)
> Trump has set a great direction in Iraq/Afghanistan (get the hell out).
This has concerns about leaving (yet another) power gap, no?
> Trump has worked marvels with Kim (when was the last nuclear test?)
Didn't Kim absolutely walk away from the most recent meeting with Trump with absolutely no deals made whatsoever?
> Trumps purpose with the travel ban was forcing better intelligence/screening of incoming passengers and we’ve got the data sharing he wanted.
I didn't know that increased surveillance was a good thing. Also, if his was to increase surveillance it disrupted a lot of people's lives, careers, etc. I don't know if that was the best strategic way to go about this given other, less-disruptive manners.
> NATO countries are paying more than ever.
Why is this a good thing?
> The ISIS caliphate is defeated.
Is this attributable to Trump?
> Trump wants to get true historic immigration reform on that list
What is that historic immigration reform specifically? I hear stuff about separating families at the border, children getting 'lost', and biometric screenings to verify families. Is that the reform? Is there reform I haven't heard about from the MSM?
> continues to push for a real Republican answer to healthcare while chipping away at the margins for things like drug pricing
I thought the Republican answer was to repeal ACA, which makes healthcare deniable to people with pre-existing conditions again, among other things. What are other proposed solutions?
> the economy has literally never been better, and never been better for everyone across the income scale
Is this attributable to anything Trump specifically did? I agree this is good, but I'm not sure if this is something Trump did. I'm not an economist, btw!
> Trumps strategy with China is sound (despite the talking heads all saying tariffs don’t work) and he had the leverage going into this negotiation to get important concessions.
We're going into an article where China is actually not giving any concessions and in fact has reneged on almost all of them. So I'm... confused?
If you have sources I'd love to be educated since you seem to have much greater insight into this than me, and are getting different conclusions than I am, possibly because my sources are not covering the things your sources are! Could you tell me where you're getting your sources? Thanks.
[We should be using less oil every year, but as much as possible it should be US oil (we have to trade for varieties of oil that our refineries are setup to make gas from).]
2. We do not have a peace treaty with Kim, but relations are still markedly improved, particularly between North and South Korea. Kim was threatening to nuke Guam not that long ago, and testing missiles and underground nukes constantly. We’ve stepped back from the precipice. Kim walking away is part of the negotiating. Even if Trump is ultimately not 100% successful, his hard line and hard charging rhetoric still accomplished a lot with North Korea and didn’t give up anything.
3. Information sharing on who is coming into the country is essential for TSA to do their job. They need more than just the basic passenger manifests to know about who is traveling. This isn’t about illegal mass surveillance but basic systems we already had in place for many countries which were missing from even higher risk countries.
Trump absolutely uses disruption as a tool to effect rapid change. It’s impossible to know if he could have forced the countries on the travel ban list to put the systems in place without the ban to force action.
4. Yes, NATO is crucially important and the US is paying more than our fair share. There is a specific % of GDP countries are expected to pay and the US far exceeds it.
5. If ISIS was thriving you bet that it would be Trump’s fault. Generally the President at the time gets the blame and the credit for the result of wars, being the Commander in Chief.
6. Specifically Trump wants to stop incentivizing illegal immigration by closing loopholes like Catch and Release at the border, as well as increased border security, to disincentivize people and especially families from attempting the trip. Bringing a child along should not be a free ticket to remain if you are merely an economic migrant.
The media called it a manufactured crisis because they don’t want to talk about bad policy incentivizing dangerous behavior which is leading to a humanitarian crisis. The border is totally inundated with illegal immigrant families coming over, and those people need to be processed and accounted for even if you are going to turn around and just release them into the interior.
7. The Republican plan was always stated by Trump as repeal and replace. The Republican platform does stand for protecting pre-existing conditions. There are a lot of things that are not great about ACA, mostly around Medicaid expansion and how the credits work as effectively one of the biggest tax increases on the middle class ever. By the way, it is problematic if you protect pre-existing conditions to the point where someone doesn’t need to buy insurance until they get sick. ACA tried to prevent this with enrollment periods, but it can be gamed.
8. On the economy there are a massive number of things Trump has done. The biggest and most visible was going to war with the Fed when they badly misjudged with rate hikes. But slashing regulation mainly, and the tax cuts, played a big part.
9. Back to China, notably, Lou He did not cancel his trip. It’s too early to call, but past approaches have absolutely failed and the China markets took a much bigger hit after the new tariffs news came out than the US. IMO China will only respect a hardline negotiator who they know can and will use blunt instruments to force them to make concessions. I don’t kn...
This is some intense shilling. For better or worse, the trend of US oil production just continued under Trump.
https://www.macrotrends.net/2562/us-crude-oil-production-his...
Obviously the US produced oil before Trump. But oil production has increased remarkably in the last couple years, and support for expanded drilling access and pipelines is a part of that. Agreed, for better or worse. It’s hardly controversial that Trump is pro domestic oil production. Just look at Bolton’s comments at the recent Arctic summit!
Oil could increase more under a Trump presidency than any other in history. Certainly under a barrel/mo basis if not also as a percentage increase YoY.
Your cited graph is hardly definitive. A long period of stagnation followed by hypergrowth, reconciliation in 2015, and then more hypergrowth.
1. Poor execution & personnel at odds with each other leaking play-by-play details has led to a lot of market fluctuation and difficulty for the market to price in the "real world". Anyone exposed to this gets a first hand look at the monetary cost of this. 2. Real impacts of the tariffs felt by american manufacturing & farmers as well as american consumers. If trump wanted an extended trade war he should have been much more upfront with people & prepared to cushion it. You say it's "some tariffs" but this minimizes real household struggles. 3. General impacts of "losing the people". He's a highly polarizing leader; anywhere from beat street to wall street to pennsylvania ave, people who don't get along with others will find it very difficult to be trusted on any given issue even when they're right. This is a near-constant in life, some people manage to be a net-benefit with that attitude but it's usually by leaning on other crutches like being highly gifted. Trump isn't that person.
GDP growing around 3%.
US net exports up about $55b.
Unemployment 50 year low.
Minority unemployment record low.
Non-farm payrolls up by about 3%.
Business confidence (Fed Ind Businesses) highest in 45 years.
(sources)
https://www.whitehouse.gov/trump-administration-accomplishme...
https://www.cnbc.com/2018/09/07/how-trump-has-set-economic-g...
> China deserves the pain train for backpedalling.
Fine, I'll accept your premise here. Now, on the flip side:
Why do I deserve "the pain train" for what's happening with China? Why should I and others I know suffer for this?
> I don't understand the hate Trump gets for doing what needs to be done.
Because things for me were good before, and now they are less good as a direct result of things he's doing. Trump isn't doing anything to alleviate that, and if he is, I'm not seeing the results.
Finally, he serves me, so I have every right to demand results. He made lots of promises, and he's failed many of them already.
So answer my questions. Especially with the context of him not saying we'd have to suffer for his failures.
This played out over 50y with the fragmented European market vs. the larger homogeneous US market. Starting in the US was (is) much more beneficial than starting in Europe (the language and culture issue here will never go away even when policy is more and more unified).
"The reason for the China pullback & attempted renegotiation of the Trade Deal is the sincere HOPE that they will be able to “negotiate” with Joe Biden or one of the very weak Democrats, and thereby continue to ripoff the United States (($500 Billion a year)) for years to come... Guess what, that’s not going to happen! China has just informed us that they (Vice-Premier) are now coming to the U.S. to make a deal. We’ll see, but I am very happy with over $100 Billion a year in Tariffs filling U.S. coffers...great for U.S., not good for China!"
Edit: I also have very sour memories of Obama complaining about the trade deficit with Germany. In that case none of the real issues like we have doing business with China existed. In essence Obama was complaining about German companies being too successful and Germans saving too much money. Maybe I'm particular sensitive to trade deficit rhetoric because of that. If the passing field is level, then maybe the deficit is the fault of the country that has the deficit. In this case the playing field is very skewed and that's the problem.
I assume you implicitly are saying that they also don't understand the harm a trade war also does to the American economy? Regardless....out of curiosity, how did you come to know the details of what Trump's base thinks at such a detailed level?
edit: Also out of curiosity, why would someone downvote this? Does it not seem like a perfectly fair question (if you set your politics aside and think about it logically, something that used to be the overwhelming norm on HN)?
Also balanced trade would be better than trade deficit, so it's a worth goal to achieve.
[1] https://www.export.gov/article?id=Germany-Trade-Barriers
The link you provide only mentions high testing standards and even specifically calls out that they don't get applied in a discriminatory way. Can you elaborate more?
A US import tax on Chinese goods is a tax on American consumers and manufacturers.
The way to tax China itself would be an export tax on money bound to China, including the transfers of immobile or intangible assets to Chinese nationals or corporations via domestic exchanges or brokerages--and including the cash value of transferred intellectual property.
Imports are paid for by exports. If you're worried about a trade imbalance, you could always say that the other nation can keep sending more goods if they want, but we'll only pay for them with trade goods and services, not with cash, or ownership of land and capital.
You then allow only your own nationals to exchange old money for new money. In order to avoid losing all of the value of their old money, foreign holders would have to buy something from a domestic person, who could then exchange the currency.
A smart exchanger would then either keep the new cash, or buy back their sold things at a lower price. In effect, it ends up being a one-time tax on domestic currency being held abroad. Any country that had been building up a reserve of your currency via trade deficits either has to settle up immediately by importing a giant bolus of your trade goods, or it gets screwed.
US States have right and left been legalizing precious metals for currency this last year, perhaps in preparation for a return to the gold standard and dumping federal reserve notes after an audit of the federal reserve...
You get to print absurd amounts of money without significant inflation because every other nation in the world hoards your currency because it’s the de facto standard for trade. US dollar stability owes a lot to the fact that everyone else holds a ton of dollars.
> US States have right and left been legalizing precious metals for currency this last year...
It’s never been illegal to trade precious metals for goods or services. Precious metals may not be legal tender but no one has been prevented from using them as currency.
To the extent that some states may make gold or silver coins legal tender, it’s just pandering to conspiracy theories and paranoia. In the event that the dollar collapses, having gold as an alternative legal tender does nothing. Anyone saying otherwise is either lying or ignorant.
If someone owes you $1300 dollars, having gold as an alternative legal tender doesn’t help you if the dollar collapses. The person owing you is absolutely not going to go find a Troy ounce of gold coins to pay you. They’re going to happily pay you the $1300 they owe you in devalued US dollars. And you’ll accept, because that’s what legal tender means.
China has less flexibility. Idled factories are a huge problem, and there is no other buyer as large as the US. It is relatively easier for the US to buy elsewhere, both abroad and domestic.
About 83% of the tariff burden is getting paid by China. (analysis by European financial firm)
Even the part we do pay isn't all bad. It reduces the need for other taxes. It supports American workers, reducing income inequality.
Seems things are going far better in this little trade war than I was expecting. If the 17% paid by US consumers displaces other taxes, that's a huge net gain.
While that's technically true, the tariffs have the effect of increasing the price of goods, so the exporter may need to lower their price and drop their profit margin to remain competitive.
> The way to tax China itself would be an export tax on money bound to China, including the transfers of immobile or intangible assets to Chinese nationals or corporations via domestic exchanges or brokerages--and including the cash value of transferred intellectual property.
That's an interesting idea, but doesn't the US Constitution ban export taxes?
https://fas.org/sgp/crs/misc/R42780.pdf
You couldn't tax a crate of polypropylene combs going from Chicago to Shenzhen. You might be able to tax the sale of 100 shares of stock in Acme Unbreakable Combs, Inc. to Chan Jingwei of Shenzhen on the Nasdaq exchange. Maybe tax the transfer of technical plans and patent rights for a comb-making machine from AUC Inc. to Acme Shenzhen Manufacturing, a Chinese corporation. And you might be able to tax the sale of a Seattle 4000-sqft 5-bedroom house to Mr. Chan.
In all those cases, you're not moving goods, you're moving ownership.
And a regressive tax at that, as it will affect poor people more compared to the better off.
Xi will stay in power may be in next 20 years, and he knows US will have general election in every 4 years. Trump gets the idea: https://twitter.com/realDonaldTrump/status/11261065400150712...
How will that work? I only see them increasing the overcapacity as the market for commodity stuff gets even smaller
> success of the Belt&Road strategy requires a shift from US/Western export to vast investment elsewhere;
China had almost 20 years to do so, but Chinese companies were blindly charging ahead into US market. Only very recently, the business community began to realise that the rest of the world is "not so bad" business-wise." Xiaomi and BBK brands were a hit in India, but their C-levels ignored India up until they were almost buried in money from Indian market.
Instead of making this a civilised conference resolving trade issues its a pissing match between two superpowers. This is exactly the situation that the EU has tried to avoid with its own dealings with these two alpha male gorillas.
If we were dealing with rational countries here there would indeed be a deal. But this isn't a trade dispute between the Netherlands and Switzerland.
China pushing back publicly (rather than making a deal and then ... simply not following through) against the US doesn't play well in the US as far as getting someone they want elected. Americans hurting economically are the folks cheering on Trump to some extent (well a vocal portion) and aren't likely to back a deal that isn't perceived to be favorable.
If the administration in China is playing an internal game, that makes a lot more sense than trying a potentially very counterproductive play in the US.
China is censoring internal news about these trade controversies. From family over there I know that the general public isn't seeing this on TV or anything. And even messages on WeChat are being taken down (my wife has had several private postings removed)
You are implying that the current policies will bring them out of poverty which in a sense contradicts your first statement.
In that sense, China is (IMHO) actually an outlier, an exception where a Communist regime used fully capitalistic economic policies and foreign investment to bring people out of poverty. This could have happened even if there was a different form of government there.
But even with that, it doesn't change the removal from WeChat private messages that my wife experienced as recently as over last night.
US elections are next year. If the trade war escalates this summer, the effect on voters and the US economy will be hardest 6 to 12 months from now. After that the US economy will start to adjust for the new normal.
If things are worse, voters could be just as angry and willing to vote for someone who wants to fight ... more with China over trade.
This could be a case where China might want to stoke a problem, and get more blowback than they otherwise would have. The current POTUS (elected dude to a lot of things including economic concerns by some voters) has already proven you can put up a fight and the sky doesn't fall... and a politician might not see making a deal advantageous to China as a good political move, or even likely to produce a lot of economic benefit.
This is quite factually untrue. [0] [1] [2] [3]
To be clear, this is entirely as a rebuttal to your claim, not as any broader statement about international policy or outcomes.
[0] https://www.bloomberg.com/news/articles/2019-02-14/u-s-soy-e...
[1] https://www.nytimes.com/2018/11/19/us/politics/farming-trump...
[2] https://www.forbes.com/sites/jamesellsmoor/2019/02/24/under-...
[3]https://www.minnpost.com/economy/2018/08/trade-war-pulls-por...
China's leaders can misspeak. Why should they tell others how to speak? China's leaders cannot disarm their enemies. Why should they try to disarm yours? If people could go to China or Russia without having their businesses raided by the police just for being good at what they do and employing people, who cares who's rich or poor?
Go high enough on the wealth ladder, and it's almost comical about how real wealth lives. Super frugal, much simpler than the trap of material wealth and celebrity everybody presumes.
Until you find and build paradise, you have very little credibility in telling other people what to do from far far away.
What is that supposed to mean? That there won’t be another administration in the future is how it sounds.
Rather in the past they've agreed to various regulations and laws and ... just not enacted or simply enacted and not followed them. That last part being the real question in all these details, does it matter if a deal gets made anyway?
If anything the traditional route would have allowed the POTUS to declare victory and everyone just move on, but this is far more confrontational and unusual based on my understanding.
https://www.youtube.com/watch?v=EQ9bP6wo8rA&list=WL&index=49...
Trump, if anything, may have shown you can call out China and do things and ... the sky doesn't fall.
I don't doubt that it is possible that China's leadership feels something will change, I'm not so sure they get what they want.