Trade wars

[Pellice]

Is it wrong of me for kinda wanting to say "bring it on" and see how down and dirty this trade war thing will go?

Better to get this thing over with than the whiplash of maybe, maybe perhaps?

Except (imho) it *cannot* in reality come to that. The US is incapable of going it alone, and its wealthiest corporations and citizens are embedded deeply all over the world. The US has fewer and fewer friends at this point in time, and most other states have realized what is going on and have already moved on to making agreements without the US. It is no longer 1960.

Sometime, maybe very soon, the US will be forced to adopt the metric system

 

[USGrant1962]

Except (imho) it *cannot* in reality come to that. The US is incapable of going it alone, and its wealthiest corporations and citizens are embedded deeply all over the world. The US has fewer and fewer friends at this point in time, and most other states have realized what is going on and have already moved on to making agreements without the US. It is no longer 1960.

Sometime, maybe very soon, the US will be forced to adopt the metric system

Hmm. Since the U.S. is the biggest importer in the world, I doubt most other states have moved on.

https://www.trademap.org/Country_SelProduct_Map.aspx?nvpm=1|||||TOTAL|||2|1|1|1|1|1|2|1|

 

[Freedom56]

Except (imho) it *cannot* in reality come to that. The US is incapable of going it alone, and its wealthiest corporations and citizens are embedded deeply all over the world. The US has fewer and fewer friends at this point in time, and most other states have realized what is going on and have already moved on to making agreements without the US. It is no longer 1960.

Sometime, maybe very soon, the US will be forced to adopt the metric system

Metric system here? That is funny. The vast majority of people can't multiply by 10 without a calculator.

 

[samclem]

Metric system here? That is funny. The vast majority of people can't multiply by 10 without a calculator.

And yet, Americans are among the most productive workers in the world. Yes, they work more hours than most, but even on a per-hour basis they produce more than in most other countries.

2016 figures, GDP/workers:
US: $63.26 per hour
OECD average: $47.08 per hour
EU average: $47.71 per hour

There are many reasons for this--a lot of factors beyond worker competency (esp systemic issues) contribute to the GDP figures.

 

[Freedom56]

And yet, Americans are among the most productive workers in the world. Yes, they work more hours than most, but even on a per-hour basis they produce more than in most other countries.

2016 figures, GDP/workers:
US: $63.26 per hour
OECD average: $47.08 per hour
EU average: $47.71 per hour

There are many reasons for this--a lot of factors beyond worker competency (esp systemic issues) contribute to the GDP figures.

Yes and a lot of the productivity gains are due to automation and outsourcing. In every medium to large company in the US, there are a small number of workers that carry the weight of the majority. Just think of the productivity gains that could be realized if sms messaging, social media and non work related sites were blocked from PCs and mobile devices.
In 1995, at my last company we had 1853 employees in our division and our revenues were approximately $118M. When I retired in 2015, our headcount was down to 278 and our revenues were $111M. We became one of the most profitable divisions in the corporation by automating, outsourcing, and purging the "walking wounded", a term coined by our HR Director. Every executive knows that productivity gain means headcount reduction. It's more difficult to layoff workers in Europe, but they are learning fast.

 

[alaska55]

The trade deals have devastated the working class to the benefit of the investor class and the financial industry. Go back in time and check out pay for CEO's, CFO' and upper managers etc from the 50's 60's and 70's. their pay started to explode as they started to export job's and outsource. Its a race to the bottom. We have our 1 million+(I have 500k ,small pension and SS) in retirement portfolio , pension and SS. I'm sure we will be just fine. We are doing exactly what the Chinese expect of us. Short term thinking. They are hitting singles & doubles and we're swinging for the fences and striking out.Check out this chart from fortune magazine
This One Chart Shows How Obscene CEO Pay Has Become | Fortune The 70's is when they started to really ramp up the outsourcing. If you think only low skilled workers were affected by this, your wrong, engineers and office ,support and skilled maintenance workers were also affected. I think it's about time we suck it up. Is it not true also that the 70's and 80's is when our budget deficit really started to explode.

 

[NYEXPAT]

I remember reading ( I think it was Gundlach), that he was taught tariffs were one of the two reasons for the "Great Depression"?

 

[eytonxav]

Just think of the productivity gains that could be realized if sms messaging, social media and non work related sites were blocked from PCs and mobile devices.

If that was universally done, the post counts on here would go down to nothing

 

[alaska55]

I remember reading ( I think it was Gundlach), that he was taught tariffs were one of the two reasons for the "Great Depression"?

He was on CNBC the other day and yes he did say tariffs were part of the problem but(a big but). This is in no way like the the tariffs of the 1920's at least not yet.

 

[HFWR]

If that was universally done, the post counts on here would go down to nothing

Good thing I retired...

Seems to me the idea of tariffs forced otherwise free-traders to rationalize reasons for them, rather than the other way around. Not saying some renegotiation isn’t warranted...

 

[USGrant1962]

Here's a good example of an innumerate journalist fear mongering on trade. https://www.cnbc.com/2018/04/06/bou...t-in-the-cross-hairs-of-trumps-trade-war.html

The article says that new Chinese tariffs on Bourbon are "bad news for distillers". Chinese imports of Bourbon last year were 9 MILLION DOLLARS! Um, that is 0.1% of Kentucky's production (also in the article at $8.5 billion, with b).

And it is probably mostly the good stuff going to Communist Party leaders - so maybe more Pappy for us!

 

[Chuckanut]

I am all for free trade, providing all sides play by the rules. Actions like this makes me think some aren't playing fair.


Product Piracy Goes High-Tech: Nabbing Know-How in China - SPIEGEL ONLINE

Never before have the Chinese robbed the West of so much and such sensitive merchandise. Fully 70 percent of all illegal copycat products come from Asia, and most of that comes from China, in what has mushroomed into a $300 billion market. And the issue is no longer just a pair of poorly copied Adidas running shoes or a plastic version of a Gucci watch. More recently, the Chinese and others have taken to pirating expensive, high-tech knowledge, allowing them to duplicate entire machines and systems.

 

[Texas Proud]

I am all for free trade, providing all sides play by the rules. Actions like this makes me think some aren't playing fair.


Product Piracy Goes High-Tech: Nabbing Know-How in China - SPIEGEL ONLINE

Also, it seems that people seem to have a narrow view of free trade... one guy on TV from the WSJ was arguing about the tariffs and someone else said that they would have a problem if someone were selling knock off WSJs downstairs for 5 cents a copy.... kinda shut the other guy up...


Now, we are not free of trade barriers... we have rules for milk that make it higher... we have import duties on sugar that should go away and I would bet there are others out there where we do not play fair... however, I think the cheating from China and some other countries have gone way over the line....

 

[Free bird]

There's no trade war. We have a bazooka they have bb gun.

 

[CardsFan]

I notice this thread has been declared a "hot topic" so I hope this fits within the guidelines.

Protective Tariffs have been in place for many years in most every country. In most cases the country is trying to protect a local manufacturer, process, commodity, or type of industry.

In my w*rk life I was involved in exporting both materials and technologies to every continent, except Antarctica.

We experienced protective Tariffs in many, including Morocco, Tunisia, most of Europe, Brazil, Peru, Canada, and China. In some cases, setting up a local entity "solved" the problem. In some, not.

In China we had IP stolen to the point the local companies actually used photos from our web site to sell their products. Local companies took our process designs and sold them for 10% of our charges (and yes, out charges had a HEFTY profit).

FYI.

 

[samclem]

If the problem is theft of intellectual property and counterfeiting, why not address those problems? Fix the broken enforcement mechanisms. A tariff on products made in Country X is a very blunt instrument if the problem isn't every single manufacturer in Country X. If we put a tariff on all products from Country X, the counterfeit/stolen IP stuff from that country will, in many cases, still be sold elsewhere (and thereby drive down the demand for their legit US competitors). And, any legit manufacturers in Country X will also get hurt. That may sound great to some in the US, but it isn't: If "clean" manufacturers in Country X do well and just the "dirty" companies get punished, that's a source of effective internal pressure on the government of Country X. If >every< manufacturer in Country X is subject to US tariffs, then the "cheaters" there will be at a competitive advantage and will drive out the clean companies.

Getting this right is complicated, and maybe won't fit well on a bumper sticker.

Tariffs might work as an attention-getting first step for more focused measures. Long term they are not a winner--for us.

 

[CardsFan]

Getting this right is complicated, and maybe won't fit well on a bumper sticker.

Tariffs might work as an attention-getting first step for more focused measures. Long term they are not a winner--for us.

I fully agree, they are an attention-getter. But they are also protective within the country enforcing them. Long term, we are ALL better without them. But let's not pretend they are not in place, right now, all over the world, and with countries we have a good relation with!

Getting at the theft of IP sounds great. But if the offending country basically ignores any law suits (yes, Megacorp tried), what then?

FWIW, I am NOT advocating for any position ( I frankly am not sure where I stand right now), just trying to get facts on the table, and continue with an informative discussion..

 

[kcowan]

I think we have to keep in mind that Trump has limited powers to act without Congress. So the more complex IP might require Congressional approval?

 

[CardsFan]

I think we have to keep in mind that Trump has limited powers to act without Congress. So the more complex IP might require Congressional approval?

I agree that any US president has limited power. But I think those limits are fairly broad when it comes to trade negotiations.

In the case of IP protection, I think that ship may have sailed, as its been going on so long. In many cases, western companies just saw it as a cost of doing business and hoped they could protect it by keeping it close to vest. In the case of my old megacorp, they actually intentionally did not get patents in some countries (China being one) as that made the IP even easier to steal.

We shall see.

 

[Cayman]

If the problem is theft of intellectual property and counterfeiting, why not address those problems? Fix the broken enforcement mechanisms. A tariff on products made in Country X is a very blunt instrument if the problem isn't every single manufacturer in Country X. If we put a tariff on all products from Country X, the counterfeit/stolen IP stuff from that country will, in many cases, still be sold elsewhere (and thereby drive down the demand for their legit US competitors). And, any legit manufacturers in Country X will also get hurt. That may sound great to some in the US, but it isn't: If "clean" manufacturers in Country X do well and just the "dirty" companies get punished, that's a source of effective internal pressure on the government of Country X. If >every< manufacturer in Country X is subject to US tariffs, then the "cheaters" there will be at a competitive advantage and will drive out the clean companies.

Getting this right is complicated, and maybe won't fit well on a bumper sticker.

Tariffs might work as an attention-getting first step for more focused measures. Long term they are not a winner--for us.

Bolding is mine.

+1 samclem

 

[eytonxav]

There's no trade war. We have a bazooka they have bb gun.

They have cheap goods and we have lots of money/buying power. Its hard to say which is the bazooka when its starts effecting US household pocketbooks. My guess is some sort of deal will be reached, as tit for tat trade tariffs don't serve either parties interests.

 

[flintnational]

IMHO the issue is not whether trade is fair or not fair. The more important question is, can government make it better? IMO the answer is no. Once the door is open, CEO's across America will be lining up asking the government to protect them from all sorts of perceived unfair trade practices. Politicians seeking votes and campaign funds will be happy to oblige.

“And just tell me where in the world you find these angels who are going to organize society for us.” ― Milton Friedman

 

[Hamlet]

They have cheap goods and we have lots of money/buying power. Its hard to say which is the bazooka when its starts effecting US household pocketbooks. My guess is some sort of deal will be reached, as tit for tat trade tariffs don't serve either parties interests.

My hope is that a deal is reached, but I’m not real confident. I don’t think there is much understanding of how trade works or rationality in general in one of the key parties.

 

[USGrant1962]

My hope is that a deal is reached, but I’m not real confident. I don’t think there is much understanding of how trade works or rationality in general in one of the key parties.

Agree, the Chinese are pretty insular. Fortunately our folks have ongoing business in North and South America, Europe, and across Asia.

 

[kitesurfer2]

i got a green banner warning so i won 't say what i know to be true....I have a habit of getting threads locked i think

But...get rid of that wal mart stock. wal mart will be the first affected because their junk does indeed come from China. s o you may very well pay more for low bid , low quality . buy good American made to be part of the solution.