Calling anons who know a thing or two about economics.
Trump has said on more than one occasion that he'd not hesitate to throw a 35% tariff on all imported goods. The idea in mind is that this will make it less profitable for companies to manufacture overseas, thus forcing companies to move manufacturing back to the US. Detractors say this will just cause the companies to increase prices and just pass the increase off to consumers. But when you pair this with Trump's tax plan, especially his corporate tax plan:
>No business of any size, from a Fortune 500 to a mom and pop shop to a freelancer living job to job, will pay more than 15% of their business income in taxes. This lower rate makes corporate inversions unnecessary by making America’s tax rate one of the best in the world.
Won't this make that tariff negligible if not make the US a more favorable market to manufacture and increasing foreign investments in the US? On top of that, with more and better paying jobs we'll see an increase in consumer confidence, the housing market booms, less debt, a stronger dollar, an increase in GDP which will help in growing out of the national debt.
Am I missing something? If this is a likely effect, why isn't Trump touting it?
I'm no economist btw... Just trying to learn.
Exactly.
And the reason he's not talking about it much is because the large majority of people wouldn't get it.
>>69161279
This is the oldest Economic arguement in America. Listen to the champion of free trade, Milton Friedman and you tell me if getting rid of tariffs worked.
https://www.youtube.com/watch?v=zk3ruapRQZk
https://www.youtube.com/watch?v=QXkX4POxA0g
https://www.youtube.com/watch?v=7DhagKyvDck
>>69161478
Bruh, seriously it doesn't seem that difficult to understand. I'm pretty illiterate when it comes to economics and it makes sense to me.
It doesn't effect GDP. The idea that tariffs doesn't cause recessions is one of the most basic facts of economics.
In warning about Trumponomics, Romney declared
If Donald Trump’s plans were ever implemented, the country would sink into prolonged recession. A few examples. His proposed 35 percent tariff-like penalties would instigate a trade war and that would raise prices for consumers, kill our export jobs and lead entrepreneurs and businesses of all stripes to flee America.
After all, doesn’t everyone know that protectionism causes recessions? Actually, no. There are reasons to be against protectionism, but that’s not one of them.
Think about the arithmetic . Total final spending on domestically produced goods and services is
Total domestic spending + Exports – Imports = GDP
Now suppose we have a trade war. This will cut exports, which other things equal depresses the economy. But it will also cut imports, which other things equal is expansionary. For the world as a whole, the cuts in exports and imports will by definition be equal, so as far as world demand is concerned, trade wars are a wash.
>>69161818
It really only requires common sense.
Most people don't have that.
Know what would work even better, a 65% tariff on manufactured products and a 13% flat tax for all businesses inside the USA
30% tariff on all non manufactured imports.
>>69162033
You didn't take into account having the second lowest corporate tax rate in the world.
>Total domestic spending + Exports – Imports = GDP
The idea is to create a market favorable for manufacturing here. Even with a trade war the US will have such a favorable tax rate companies would have no choice but to invest here.Thus increasing our exports and decreasing imports. I'm really not seeing how this isn't a win/win for the US economy.
>>69161279
Well the reason that money is worth nothing now, the reason that a handmade American suit is 10% of the average annual salary now and was 3% of the average salary in 1920 is because of the Federal Reserve unlimited money printing. In most cases actually it's much worse with some buying power decreasing by much much more.
>>69161279
>Detractors say this will just cause the companies to increase prices and just pass the increase off to consumers.
This will happen but the bet hes making is that when all the numbers add up it will be better in the long run to tax china and put our workers on a more equal playing field.
What about wages and working conditions though? Especially considering mass production. Won't it still be more profitable for big companies to produce abroad where they pay almost nothing for the workers and where they don't have big spendings on securrity guidelines and work regulations?
>>69162848
Something tells me he's doing more than hedging this on his bet.
>>69163288
I don't know. Maybe some anons will show up who can add up all of the variables and break it down to a positive or negative.
>>69162033
You're ignoring that the trade tariffs are for a specific purpose and thats to combat currency manipulation. One of the most basic economic facts is floating currency if we have a trade deficit with china of 500 billion dollars and the chinese want to use those dollars to buy chinese currency the demand for the Renminbi should skyrocket and price go up i.e. Inflation. At this point it should cost more Renminbi to re invest in America but what they do is artificially devalue their currency so inflation doesn't happen. They are cheating and thats why we should add a trade tariff.
So a tariff alone would make prices go up, but with a much lower corporate tax rate, shouldn't you theoretically see prices stay mostly the same?
There are plenty of corporations that are NOT manufacturers, so they would have more money to spend on R&D, pay raises, attracting better talent, etc?
>>69161279
Actually, this will result in customers buying products from companies that produce in the US, which will have the intended result.
Example:
We have Nike and Adidas both produce shoes, Adidas produces in China and Nike in the US, with the 35% tariff Nike shoes will cost 100$ and Adidas shoes will cost 135$ so customers would naturally buy more Nike shoes thus improvng Nikes profit and lowering Adidas profit.
>>69163928
I would think... again think, that lowering the corporate tax would at least make it less likely that importing goods isn't worth the trouble if companies can manufacture here. Couple that with more jobs and higher wages, consumers have more money to spend.
>>69163654
Is this just a product of the trade imbalance? Could the central bank just print more and do the same thing?
>>69164177
What about production costs and overheads? They sure are cheaper in China, no?
>>69161279
https://en.wikipedia.org/wiki/Protectionism
read up, friend
>>69161279
The first thing you always want to ask is when these hack journalists rip on his policies, you have to realize they could multiple their income by 5x working in banking or in hedge funds. Their ability to make these confident macro econmic predictions is delusional and just shows how moranic they are
Go look up videos on you tube from the early 90s and watch congress ask Donald what to do on c span recordings
>>69166213
You'll then start to realize that the smartest people in the room are the ones who actually put money on the line and make billions versus the people who talk or write about it
Same principles apply for sports analyst versus coaches
>Detractors say this will just cause the companies to increase prices and just pass the increase off to consumers.
I really don't understand why detractors say this at all.
I mean, this is what Trump wants. He wants companies to jack up the price of imported goods so consumers stop buying them. Once consumers stop buying them, they will be forced to reduce the price. With a 35% tariff on imports, their only choice to reduce the price will be to bring manufacturing back to the US.
If domestically produced goods are cheaper and similar (or higher) quality to imported goods, then there will be incentive to manufacture domestically. We WANT imports to be more expensive.
>>69166549
He's going to make it more expensive to buy imported Chinese shit and create incentive for things to be produced here in the country
With the increased transactions and lower tax rates, the velocity of money, GDP, and overall income for Americans will trend upward.
There are some flaws go his philosophy but for gods sake he's the only person who is actually trying to create real sustainable economic growth for the benefit of Americans. The rest of these hacks have their interests to make you a dependent fuck so that government can increase
It's like having a hotshot who sounds good come in to take over the company who has no intention but to scrap it and sell it off in a few years and fuck everyone who is invested in it or works there versus a guy who you may not agree with but actually can better the company
>>69161562
>>69161715
>>69161785
Libertardian detected
>>69161279
you're implying all good, never said that, you intolerant faggot. he said nabisco, carrier, ford, god damn idiot
>>69166992
So make an argument. It shouldn't be hard to prove retards wrong.
>>69162222
quads of truth
>>69166992
>libertarian
>wanting tariffs
pick 1
>>69161562
>>69161715
>>69161785
>Jewish
yeah no thanks all his policies on economy lead to globalization so fuck his retarded opinions
>>69161562
That's assuming there's no government involvement in rigging currencies, subsidizing industries, etc.
Which is exactly what China is doing.
He is threatening to use tariffs in order to renegotiate our trade deals so that e.g China stops manipulating currency. He wants to use it as leverage to get OTHER COUNTRIES to practice free trade. He wants other countries to stop being protectionist.
IF we actually did a 35% or 45% tariff, it would be a fucking disaster for our economy. But it would be an even BIGGER disaster for China and anyone else. So the idea is that they will fold and renegotiate on our terms.
But yes, lowering the corporate tax and other things like that will go a long way towards making the US business-friendly and bringing jobs back to our country.
>>69167356
Getting fucked over by other state based governments because your libertarian ideology says tariffs are a a violation of the NAP
I'm all about free trade but we live in a statist vacuum
Goal one is to destroy the left then we can move to libertarianism
>>69167618
B-b-but muh free market. St. Mises, peace be upon him, said free trade is good for everybody, including the working class.
>>69161279
They're complementary in the sense that both encourage greater domestic production, and the reason it's not "touted" is because it's too obvious to bother.
Neither issue is as simple as "change number, get effect", however.
>>69167758
>Goal one is to destroy the left then we can move to libertarianism
Amen brother.
>>69167758
So I'm not quite sure where other libertards stand on tariffs, but I see some very basic ones as a necessity, but other than that there is no point.
>destroy the left
Read Atlas Shrugged, I think that the amount of people who do not want to work for themselves will make 'destroying the left' impossible.
>>69167703
>He wants to use it as leverage to get OTHER COUNTRIES to practice free trade.
That argument is GATT XXd. It has literally never worked.
All that will happen is China will respond with its own tariffs, which will be legally justified as retaliatory action. And said retaliation is measured in terms of total scope: not +35% for +35%, +X% in order to equalize cost of damages.
>>69167866
How is it too obvious. I doubt even most Trump supporters know most of his positions. It should be argued as complimentary by him. He's out of his element when he debates so it makes sense that he wouldn't state his positions more clearly.
If you just increase tariffs people will just sneak things in illegally, it's the same issue as trying to raise taxes
>>69168273
But the lower corporate tax rate make it more favorable to manufacture better products here. Why would the black market be a better alternative?
>>69168260
It's also unnecessary. Both are "MAKE MORE THING IN USA GET JOBZ" policies and can simply be trumpeted as such; speaking of them together would only work to confuse people.
>so it makes sense that he wouldn't state his positions more clearly.
If he was clear about the specifics then he would be open to attack on them, and he doesn't want to get into a fight on trade.
>>69161279
I'm under the impression that he would slap tariffs on specific COMPANY products (like Ford if they move to Mexico), not blanket tariffs.
Is the media lying again?
Also, his tax plan IS (almost) revenue-neutral WITHOUT CUTS because he gets rid of so-called "tax expenditures" (subsidies and exemptions).
Right now we take in $4 trillion in tax and give back $2 trillion, leaving us with $2 trillion net. Trump wants to just slash rates AND subsidies and bring in $2 trillion period.
Am I missing something? Why isn't this discussed?
>>69168552
Would still take time to increase production, foreign production wouldn't immediately go away meaning there'd be plenty of goods, and the costs of production here would still be high which would stifle production on labor-intensive goods.
It's more apt to call it a grey market - where the goods aren't illegal but loopholes or other tricks are used to get them into the country.
>>69168892
>I'm under the impression that he would slap tariffs on specific COMPANY products (like Ford if they move to Mexico), not blanket tariffs.
That would be totally unconstitutional, to my knowledge. Bullying ain't allowed. Unless it's clever and SCOTUS can loosely interpret it to not be bullying.
>>69169269
Not even a matter of constitutionality, specific tariffs like that violate the WTO. Moreover, tariffs on a product coming from Mexico violate NAFTA.
>>69161562
>milton friedman
>>69165776
Now that is the tricky part, i did study economics but half of that shit i dont even remember now, basically you have a few factors that formulate a product price, cost of material, cost of production, labour cost, shipping/transport, cost of tools that are being used (things get broken etc.). When you accumulate all of that the you add 15% or more and sell it. If you look at the example i used with Nike and Adidas shoes you will notice that the price goes up 35$ now if we make stuff in China. But if we employ a factory worker in the US who works for 8-9 dollars/h it would be better for companies to produce in the US because a single worker can make 20-30 shoes in 1h and that would pay for his salary etc. The companies would make less profit either way, but the worker should be more satisfied.
>>69168552
No it wouldn't. The fact that plants are already widely established coupled with the almost nonexistent safety regulations and the ultra-underpaid workforces, it would be extremely more profitable to just avoid the tariffs altogether. Americans are spoiled, they don't even come close to competing with foreign workers since it costs so much to pay them. A 35% increase in tariffs would only hurt industry
>>69165954
This
Trump wants to us to go Isolationalist for a while and focus on Domestic Issues that have been hurting Americans. Hence him saying others should pay for US Military support, we constantly keep fighting proxy wars for other countries interests and it is fucking bleeding us dry.
>>69170090
Here's what Kudlow had to say about Trump's tax plan.
Starts at 41:45.
https://youtu.be/ml44V_4iDRI
>>69171633
Libertarians BTFO
>Middle Class RISES
>Good politics, even better economics
Bump
