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Because it's a bit more complicated and combines bits of the EU, UK, US and other threads, here's a combined zone for us to discuss quick-win strategies for all our countries to prevail in trade wars and protect our consumers/voters/jerbs/whatevers. Latest events from China (11/07/2018): quote:China vows to retaliate as US threatens tariffs on further $200bn of goods And from Europe (also on 11/07/20189): quote:Trump threatens car tariffs after EU sets up £2.5bn of levies on US What's next? Because it's in the melting brain of orange man and US President Donald J. Trump, dealmaker extraordinaire, who knows? However, if the US does put tariffs on EU German cars, be prepared for some very nasty meltdowns in the EU economy, as it will drag down not just Germany but the whole integrated parts supply industry of about 8 Eastern EU countries. This could very well tip the EU back into a recession with little tools to play with and the EU will be forced to hit back hard. One of the places they'll hit back is with more ag products - and so will the rest of the world - all the big car exporters to the US (EU, Japan, Mexico and Canada) are also major ag importers from the US. Look for soybeans to take another big hit and wheat to follow, with possible rising bread prices as a consequence. That's when it'll be real fun. But aren't we protecting jobs? No, trade wars are dumb and no-win for anyone. Except The Donald. Huh? Here's D&D favourite Mark Blyth discussing the current situation and trade wars overall: https://www.youtube.com/watch?v=itpZ6WDONn8&t=593s Thread Tariffs
Junior G-man fucked around with this message at 11:48 on Jul 11, 2018 |
# ? Jul 11, 2018 10:16 |
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# ? May 23, 2024 15:48 |
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something i'm not entirely clear on: would the proposed tariffs on cars hit the sales of EU-manufactured cars or only the imports? because as far as german cars are concerned, the majority of them are manufactured in the US. in 2017, 1.35 million german cars were sold to the US, but only <500k of them were imported, the rest were manufactured in the US. (that tendency is rising, by the way, each year more and more german cars are manufactured in the US.) would those be hit by the tariffs as well? also thanks for making the thread, it's nice to have all this in one place
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# ? Jul 11, 2018 10:28 |
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https://twitter.com/realDonaldTrump/status/1016757033071079424 This Is Going Fine.
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# ? Jul 11, 2018 10:29 |
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botany posted:something i'm not entirely clear on: would the proposed tariffs on cars hit the sales of EU-manufactured cars or only the imports? because as far as german cars are concerned, the majority of them are manufactured in the US. in 2017, 1.35 million german cars were sold to the US, but only <500k of them were imported, the rest were manufactured in the US. (that tendency is rising, by the way, each year more and more german cars are manufactured in the US.) would those be hit by the tariffs as well? I don't know how that would work myself; if anyone here can shed some more light on it that would be good. Maybe it wouldn't just be a tariff slapped on the bumper of cars arriving in US ports, but on those manufactured by companies with an EU origin? Plus, don't forget about Italy; the government there is a bunch of nationalists, lunatics and anti-vaxxers - putting a big dent in the Italian auto industry through tariffs could cause a terrible slide in their finance at the same time the Germans are hit.
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# ? Jul 11, 2018 10:33 |
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botany posted:something i'm not entirely clear on: would the proposed tariffs on cars hit the sales of EU-manufactured cars or only the imports? because as far as german cars are concerned, the majority of them are manufactured in the US. in 2017, 1.35 million german cars were sold to the US, but only <500k of them were imported, the rest were manufactured in the US. (that tendency is rising, by the way, each year more and more german cars are manufactured in the US.) would those be hit by the tariffs as well? Going to guess it'll be all of them because: A) That's the dumbest possible option and B) Trump will go into a frothy rage every time he sees a Mercedes or BMW logo and details like place of manufacture are a lot more complicated than "symbol = bad"
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# ? Jul 11, 2018 10:33 |
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I assume it would be those imported cars, which would probably incentive car makers to produce in the US. Anyway, it is really about raw numbers. I am struggling to find an article that gives full numbers of tariffs imposed/retaliatory tariffs. Ardennes fucked around with this message at 10:51 on Jul 11, 2018 |
# ? Jul 11, 2018 10:43 |
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Can someone give a quick and quotable expalantion of how trade deficits and trade wars actually work? Like an Adam Smith excerpt or something.
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# ? Jul 11, 2018 11:24 |
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Xander77 posted:Can someone give a quick and quotable expalantion of how trade deficits and trade wars actually work? Like an Adam Smith excerpt or something. Here's a brief explainer from The Atlantic And here's D&D favourite Mark Blyth discussing the current situation: https://www.youtube.com/watch?v=itpZ6WDONn8&t=593s
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# ? Jul 11, 2018 11:47 |
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Orange Devil posted:Going to guess it'll be all of them because:
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# ? Jul 11, 2018 11:52 |
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I said a long time ago in the China thread the TRADE WAR will happen, and it will last from half year to 1 year. Minimum of half year because it takes time for the trade war effect to reach the people (who for the most part, wanted a trade war and thought the US can win a trade war). Maximum of 1 year because the Americans life style simply don't have reserve to out last the Chinese. Not to mention the Chinese people don't have the option to choose vote out a trade warmonger. edit: The US-EU trade war takes up smaller piece of the pie, most like will end sooner. tino fucked around with this message at 11:57 on Jul 11, 2018 |
# ? Jul 11, 2018 11:54 |
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tino posted:
Be interesting to see if big impacts start hitting the US voters before November though. I had a meeting yesterday with serious US grain and soy producers and they're worried as gently caress. Didn't ask them about their voting though ...
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# ? Jul 11, 2018 11:56 |
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I dimly recall some youtube about the trade tensions between the US and EU a few years ago, and it was pointed out that the US had so effectively outsourced its manufacturing base that it depended on the EU to make the machines for its factories, similar to the perennial "value-add" argument we in Australia try to avoid (because we outsourced our manufacturing too). The usual economic benefit of trade is in getting the materials for your own manufacture and selling the results of your manufacture for more materials, and thus you have "value-added" to the original trade. It appears to be an equitable deal but actually tends to favour the manufacturing side of the equation because then the commodities supplier becomes dependent not just on the changeable rate of commodities futures, but also on that direction of manufactured goods instead of creating their own from their own raw materials. This has a knock-on effect to the commodities parter's labour market etc etc. A trade war is therefore doubly dangerous to a net exporter of raw materials like Australia, who has to be careful which side they pick between China and America; they depend on China more economically but they have to side politically with America. So in addition to the economy-depressing effects of trade wars, there's political risk involved too.
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# ? Jul 11, 2018 12:02 |
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Sorry if I was unclear. I wasn't talking about "if you slap tariffs on us, we'll slap tariffs on you". I'm talking about the basic premise of "if we have a trade deficit with someone, that someone is taking advantage of us".
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# ? Jul 11, 2018 12:06 |
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Xander77 posted:Sorry if I was unclear. I wasn't talking about "if you slap tariffs on us, we'll slap tariffs on you". who is the intended audience of this explainer? if you're talking to someone who wants to turn back time to an era of strong manufacturing employment, they'll probably have a different definition of "us" in "taking advantage of us" versus someone who is a more services-oriented laborer (as like 80% of americans are today) https://www.youtube.com/watch?v=rFrSBPXhmp0
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# ? Jul 11, 2018 12:24 |
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What the gently caress threadbare national security argument is being shat out to cover soap and cat food? Did he even remember to bother with that fig leaf this time or has Congress become so utterly terrified of even pretending like they disapprove of this man with two assholes and his lunatic base that nothing will be done?
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# ? Jul 11, 2018 12:29 |
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Roumba posted:What the gently caress threadbare national security argument is being shat out to cover soap and cat food? Did he even remember to bother with that fig leaf this time or has Congress become so utterly terrified of even pretending like they disapprove of this man with two assholes and his lunatic base that nothing will be done? National security and unchecked presidential powers in trade have been given to the US president since Nixon I'm-not-a-crook'ed his way out of the White House. I mean, this Congress is a special kind of spineless but it's not just them.
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# ? Jul 11, 2018 12:35 |
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botany posted:something i'm not entirely clear on: would the proposed tariffs on cars hit the sales of EU-manufactured cars or only the imports? because as far as german cars are concerned, the majority of them are manufactured in the US. in 2017, 1.35 million german cars were sold to the US, but only <500k of them were imported, the rest were manufactured in the US. (that tendency is rising, by the way, each year more and more german cars are manufactured in the US.) would those be hit by the tariffs as well? Tariffs only hit imports. Specifically, they apply to goods that enter a customs territory for the purpose of consumption. When I get home later today, I’ll post some stuff about Commission Implementing Regulation (EU) 2018/886, which is the document that implements all the new tariff increases for certain products imported from the US. It’s pretty indecipherable if your line of work isn’t at least customs-adjacent, but luckily My job is 100% tariff and tariff nomenclature related. But in a word: there aren’t too many kinds of goods affected, unless Trump gets reelected and pursues his trade war after 2021, in which case
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# ? Jul 11, 2018 12:36 |
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Xander77 posted:Sorry if I was unclear. I wasn't talking about "if you slap tariffs on us, we'll slap tariffs on you". I am not an economist so grain of salt : trade deficit (or surplus) is the difference between total cost of imports and total cost of exports for a country. It's a neutral term; It describes a general fact about the economy. Having a trade deficit isn't necessarily good or bad. Reasons you could have a trade deficit include being a service oriented economy (like the US) or being rich as gently caress (like the US). Trying to balance them is silly for the same reason we don't try and trade homegrown produce for a new Xbox, i.e. money is a thing. Trump is antsy about about the trade deficit because a) he's a broke-brained moron who thinks literally all human interactions are zero sum and b) his dementia addled capitalist brain can't conceptualize that you can NOT be selling overpriced crap to other people and still be financially solvent. Xand_Man fucked around with this message at 12:59 on Jul 11, 2018 |
# ? Jul 11, 2018 12:47 |
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Xander77 posted:Sorry if I was unclear. I wasn't talking about "if you slap tariffs on us, we'll slap tariffs on you". Let's put it this way. The US dollar is the reserve currency of the world. That means the US has convinced the rest of the world that they should give you their stuff and their labour, in exchange for your paper. Which you can print at will. And you control how much of it you print. And Trump is trying to tell you that this is a bad deal, because now other people have so much of your paper. Except as percentage of total, other people really don't have that much of your paper to begin with. Plus it's just money. Money is a means to get wealth, not the wealth itself. Ofcourse Trump, being a man who is addicted to money and who has spent his whole life measuring his self worth in terms of how much money he has, is fundamentally incapable of understanding this.
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# ? Jul 11, 2018 12:51 |
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Roumba posted:What the gently caress threadbare national security argument is being shat out to cover soap and cat food? Did he even remember to bother with that fig leaf this time or has Congress become so utterly terrified of even pretending like they disapprove of this man with two assholes and his lunatic base that nothing will be done? There's actually a legal reason for this. Trump is only allowed to unilaterally impose tariffs for national security reasons. However, the courts are only allowed a facial analysis of the President's motivations when it comes to these kinds of edicts on foreign countries. They cannot accept other evidence. So as far as the courts are concerned, it's about national security if the President says it is. He cannot be second guessed. The SCOTUS upheld the travel ban on the same principle, lower courts took into consideration his campaign trail comments and other things to determine it was a Muslim ban. The 5-4 decision striking it down said this is not allowed, only a facial analysis can be done, so It's not a Muslim ban unless the President says it is. He has to say national security because the courts can void his tariffs if he doesn't, but as long as he says the magic words, the courts can't even consider a legal challenge. Every tariff he ever imposes will be done for "national security" for this reason.
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# ? Jul 11, 2018 13:20 |
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Xequecal posted:There's actually a legal reason for this. Trump is only allowed to unilaterally impose tariffs for national security reasons. However, the courts are only allowed a facial analysis of the President's motivations when it comes to these kinds of edicts on foreign countries. They cannot accept other evidence. So as far as the courts are concerned, it's about national security if the President says it is. He cannot be second guessed. The SCOTUS upheld the travel ban on the same principle, lower courts took into consideration his campaign trail comments and other things to determine it was a Muslim ban. The 5-4 decision striking it down said this is not allowed, only a facial analysis can be done, so It's not a Muslim ban unless the President says it is. So can congress close this loop hole? I mean I am all for destroying the red districts.
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# ? Jul 11, 2018 13:59 |
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tino posted:So can congress close this loop hole? I mean I am all for destroying the red districts. Theoretically, sure. But the odds of the Senate getting 67 Ds to override a veto are basically zero. I doubt we'll see 67 Ds in the Senate in our lifetimes.
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# ? Jul 11, 2018 14:01 |
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Not sure they need 67 Ds, Trump's tariffs haven't been going over great with the business wing of the GOP
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# ? Jul 11, 2018 14:06 |
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tino posted:So can congress close this loop hole? I mean I am all for destroying the red districts. Both D's and R's in Congress are absolutely terrified of making any serious decisions and will avoid doing so at any cost. This is how you get the rollover of AUMF, the NSA spying and trade authorities delegated to the President. Heaven forfend those fuckers do actual policy.
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# ? Jul 11, 2018 14:06 |
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Xand_Man posted:Not sure they need 67 Ds, Trump's tariffs haven't been going over great with the business wing of the GOP yeah but the senate republicans are massive cowards and none of them want to be the first to disobey daddy trump this appears to be today's good article from the new york times: https://www.nytimes.com/interactive/2018/07/11/business/trade-war.html Mr. Fall Down Terror fucked around with this message at 14:20 on Jul 11, 2018 |
# ? Jul 11, 2018 14:08 |
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Doot doot doot https://twitter.com/jonathanweisman/status/1017037965544042496
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# ? Jul 11, 2018 14:32 |
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luxury handset posted:yeah but the senate republicans are massive cowards and none of them want to be the first to disobey daddy trump This kind of thing totally misunderstands the impetus for tariffs under Trump's brand of nationalism. Under Trump's nationalism, everyone else in the world is the enemy. With that assumption, even mutually destructive tariffs are rational, as long as they hurt everyone else more than they hurt you. We're not supposed to be benefiting from the tariffs now, the supposed benefits come when everyone else in the world surrenders and comes to Trump on their knees.
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# ? Jul 11, 2018 14:38 |
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Xequecal posted:This kind of thing totally misunderstands the impetus for tariffs under Trump's brand of nationalism. Under Trump's nationalism, everyone else in the world is the enemy. With that assumption, even mutually destructive tariffs are rational, as long as they hurt everyone else more than they hurt you. We're not supposed to be benefiting from the tariffs now, the supposed benefits come when everyone else in the world surrenders and comes to Trump on their knees. are we trying to explain trump's abusive broke brain and how it will fail to come into contact with reality, or are we trying to explain what is actually happening - that the united states is purposely initiating a corrosive trade war that will cripple its economy if left unchecked. i mean is this an economics thread or a psychology thread
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# ? Jul 11, 2018 14:41 |
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How harmful is dumping really in a macro economic sense? Because it sounds an awful lot like a sale, to put it in other terms. Although I guess if you’re worried about national security having the Chinese out compete all of your domestic steel production would be bad, but it seems like it should actually be better for the buyer than seller.
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# ? Jul 11, 2018 14:45 |
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luxury handset posted:are we trying to explain trump's abusive broke brain and how it will fail to come into contact with reality, or are we trying to explain what is actually happening - that the united states is purposely initiating a corrosive trade war that will cripple its economy if left unchecked. i mean is this an economics thread or a psychology thread These articles throw out how the US isn't benefiting from the trade war right now like it's some kind of epiphany that nobody comprehends. I mean, no poo poo, of course we're not benefiting from it now as long as everyone is willing to match our tariffs with their own. The idea is eventually they won't be willing to, and at that point we win. Now, I think that the US has basically zero chance to win a misery war against loving China and this will eventually backfire horribly, but stuff like that article just misses the point entirely.
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# ? Jul 11, 2018 14:51 |
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Squalid posted:How harmful is dumping really in a macro economic sense? Because it sounds an awful lot like a sale, to put it in other terms. Although I guess if you’re worried about national security having the Chinese out compete all of your domestic steel production would be bad, but it seems like it should actually be better for the buyer than seller. The idea is to corrode the ability of that country to make that product and then gradually rise prices back to what they were on the market but with less competition.
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# ? Jul 11, 2018 14:51 |
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Squalid posted:How harmful is dumping really in a macro economic sense? Because it sounds an awful lot like a sale, to put it in other terms. Although I guess if you’re worried about national security having the Chinese out compete all of your domestic steel production would be bad, but it seems like it should actually be better for the buyer than seller. It's bad in the sense that China is in essence exporting its own domestic instability (huge job losses from a massively overproducing steel sector) by state subsidy and then dumping the steel in the US and other places and thereby creating unemployment and instability in other countries. Plus, unlike a sale, the Chinese have no incentive to stop doing this - a store goes bankrupt quickly if it remains in sale for too long. Plus, to complete this flawed analogy, all countries have very strict laws when it comes to 'sale/money off' seasons, exactly to prevent mutual dumping, permanent price slashing and economic loss.
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# ? Jul 11, 2018 14:53 |
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Squalid posted:How harmful is dumping really in a macro economic sense? Because it sounds an awful lot like a sale, to put it in other terms. Although I guess if you’re worried about national security having the Chinese out compete all of your domestic steel production would be bad, but it seems like it should actually be better for the buyer than seller. you're on the money here. the problem is when trade policy becomes politicized and you can stir up former steelworkers and exploit their anxities for political gain by making empty promises about blowing an economic warp whistle to whisk the rust belt back to 1970 the other problem is that dumping is an artificial price suppressor. why is country X able to produce so much cheap steel? did they develop some magical new technology? if so, that magic will soon spread through the global economy and prices will normalize. but if the cheap steel is a result of something like an industrial subsidy that other nations can't match, then what happens to the global economy if and when that subsidy goes away? this is similar to the softwoods debate between the us and canada, because canadian forestry lands are mostly publicly owned and operated by provice and national government where in the states most forestry lands are privately owned and government forestry is mostly done for ecological and not industrial reasons. the canadian government sets a lower than market price fee to cut trees and there is an argument as to whether this constitutes a subsidy or not Xequecal posted:These articles throw out how the US isn't benefiting from the trade war right now like it's some kind of epiphany that nobody comprehends. I mean, no poo poo, of course we're not benefiting from it now as long as everyone is willing to match our tariffs with their own. The idea is eventually they won't be willing to, and at that point we win. Now, I think that the US has basically zero chance to win a misery war against loving China and this will eventually backfire horribly, but stuff like that article just misses the point entirely. imo the point of that article was to visualize the scale of the tariffs because the human mind is not inherently good at comprehending and comparing big numbers
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# ? Jul 11, 2018 14:54 |
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Squalid posted:How harmful is dumping really in a macro economic sense? Because it sounds an awful lot like a sale, to put it in other terms. Although I guess if you’re worried about national security having the Chinese out compete all of your domestic steel production would be bad, but it seems like it should actually be better for the buyer than seller. Disclaimer: my degree in Econ is older that most of you, so I'm a bit rusty. Dumping is harmful in most circumstances. It's not a "sale" in the sense you are used to. If I start a dog toy company, and in the beginning I sell my toys at a super discount–to the point I'm not quite coving my costs–to get some market penetration, then I am taking a risk that my strategy will fail: if I *can't* sell my toys at the price that at least covers my costs at some point, then I will go out of business. That's probably the context you are thinking of by "sale". Dumping is: my toy company is backed by the government (or cartel, or other huge source of capital), and I can and will sell my toys below cost for as long as I need to because I don't need to cover my costs, even dropping the price further if need be to lose *more* money, driving down the cost of dog toys until the toy companies in other countries can't cover their costs, and are forced to either go out of business or move their production to my country (or move production, *then* go out of business) Once enough competitors are forced out of business, I can raise prices to the point I can cover costs, since I don't have much (or any) competition. Note that dumping is different in intent than tariffs or other "benign" attempts to get a nascent industry off the ground which are (in theory, thus the quotes around benign) done with the intent to become competitive fast. It's somewhat semantic, but the use of the term 'dumping' is generally reserved for "we are intentionally loving you" type of behavior. Lumpy fucked around with this message at 15:10 on Jul 11, 2018 |
# ? Jul 11, 2018 15:07 |
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[quote="“Ardennes”" post="“486004624”"] The idea is to corrode the ability of that country to make that product and then gradually rise prices back to what they were on the market but with less competition. [/quote] That’s the theory yes. Assuming nobody else can match the subsidies and the dumper isn’t so enthrall to the parochial business interest responsible for the dumping that it even can push an eventual price increase.
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# ? Jul 11, 2018 15:13 |
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The upside to dumping is that you get goods very cheaply, subsidized by the offending government sooo
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# ? Jul 11, 2018 15:28 |
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Do we have any real life examples of dumping being used to shut down rival industries and then increase prices? I’m curious how these disputes work in practice. If the result is the same as monopolistic behavior by private industry of course it should be constrained.
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# ? Jul 11, 2018 15:39 |
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Trump's EU tariffs are a game of brinkmanship he thinks he can win and get the EU to do what he wants. His China tariffs though are legitimately for national security reasons since China's plan has been to dump extremely under-priced goods in the US to damage their domestic manufacturing to the point of non-existence, at which point China would heavily increase those prices, and the US would be forced to buy the now over-priced goods from China because it can't make the products at home anymore.
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# ? Jul 11, 2018 15:46 |
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mobby_6kl posted:The upside to dumping is that you get goods very cheaply, subsidized by the offending government sooo This is true, the consumers of that good do get a short-term benefit. Then they lose it, and the economic damage remains.
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# ? Jul 11, 2018 15:46 |
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# ? May 23, 2024 15:48 |
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Squalid posted:Do we have any real life examples of dumping being used to shut down rival industries and then increase prices? I’m curious how these disputes work in practice. If the result is the same as monopolistic behavior by private industry of course it should be constrained. there are tons of examples of one group accusing another of dumping. it was often thrown at japanese electronics firms in the 80's during that weird phase where americans were convinced the japanese economic juggernaut would crush america. the truth is often more muddled, dumping is rarely clear cut - is chinese industrial output due to a plan to destroy foreign manufacturers, or the consequence of china's internal attempt to boost employment and inability to cut output without also causing mass layoffs and triggering recession? qkkl posted:is China tariffs though are legitimately for national security reasons since China's plan has been to dump extremely under-priced goods in the US to damage their domestic manufacturing to the point of non-existence, at which point China would heavily increase those prices, and the US would be forced to buy the now over-priced goods from China because it can't make the products at home anymore. i'm not sure about this - china makes a lot of low-skill goods that america can definitely still produce. it's not like injection molding or blast furnaces are some arcane secret or difficult to set up if necessary. like, cranking out a kajillion plastic cups isn't on the same level as something like shipbuilding Mr. Fall Down Terror fucked around with this message at 15:49 on Jul 11, 2018 |
# ? Jul 11, 2018 15:47 |