We are closing in now on the beginning of the fifth month since tariffs were announced. Undoubtedly, there are now some very real consequences being felt across the economy.
https://www.k-state.edu/landon/speakers/milton-friedman/transcript.html
However, I can get behind the need to penalize China for failure to respect intellectual property and for the need to apply pressure to try to secure more access for Western companies. My skepticism of the current approach is that the pressure is better directed at China if we had engaged nations with which we have quite balanced trade (like Canada) first for some easy wins rather than going scorched earth with respect to trade with most of the globe.
I'm also skeptical that we will be able, as a representative consumerist democracy, to outlast an authoritarian nation that only 50 years ago consigned 60 million people to death during the Great Leap Forward.
Nevertheless, I get that we are trying to create leverage. If material concessions from China arrive, or we get a true free trade agreement and not some BS with a bunch of carve outs for pet industries with Britain or Canada, I will gladly admit I was wrong and applaud Trump for his efforts.
So my questions to you are:
1) What does success look like? How free must trade be to win? Totally open and unfettered? Some slight restrictions? How soon must it come?
2) What does failure look like? How much time must elapse with no signed trade agreements before your faith starts to wane? Does it ever? Are you willing to live with recession, lower economic output, and lower pay to maintain the tariffs? If so, for how long? 2 years? 5 years? 10 years? Forever?
- I can name at least 3 companies in the S&P 500 (most recently today the stalwart General Motors) which are off more than 10% as a result of direct tariff implications.
- These reductions in earnings are incurred by anyone who has a single share of an S&P 500 index fund. I would wager that most of this board qualifies.
- The impact to farmers is well publicized and very real
- A full list of the press releases from corporations directly attributable to the tariffs..... some good, most of them negative are aggregated here:
- https://www.bloomberg.com/graphics/tariff-tracker/
https://www.k-state.edu/landon/speakers/milton-friedman/transcript.html
However, I can get behind the need to penalize China for failure to respect intellectual property and for the need to apply pressure to try to secure more access for Western companies. My skepticism of the current approach is that the pressure is better directed at China if we had engaged nations with which we have quite balanced trade (like Canada) first for some easy wins rather than going scorched earth with respect to trade with most of the globe.
I'm also skeptical that we will be able, as a representative consumerist democracy, to outlast an authoritarian nation that only 50 years ago consigned 60 million people to death during the Great Leap Forward.
Nevertheless, I get that we are trying to create leverage. If material concessions from China arrive, or we get a true free trade agreement and not some BS with a bunch of carve outs for pet industries with Britain or Canada, I will gladly admit I was wrong and applaud Trump for his efforts.
So my questions to you are:
1) What does success look like? How free must trade be to win? Totally open and unfettered? Some slight restrictions? How soon must it come?
2) What does failure look like? How much time must elapse with no signed trade agreements before your faith starts to wane? Does it ever? Are you willing to live with recession, lower economic output, and lower pay to maintain the tariffs? If so, for how long? 2 years? 5 years? 10 years? Forever?
