Tariffs on Chinese goods?

[BugI02]

Yeah, sometimes it's more like "Progressive" text - it corrects to what it feels you should be thinking

 

[Woobie]

Do you accept the need to maintain a healthy domestic metals production capability? Because if you do, I'm not sure how you can put domestic industry at a competitive advantage against other players who subsidize the costs of their domestic industry output, rather than allowing said industries to deal with the consequences of over production, and then look the other way as they dump that overproduction

To see how the game is played by our "allies" an instructive example is the rise of EADS (airbus) to become a direct competitor of Boeing

No, I get that, but I'm not sure shooting ourselves in the head is the best cure for a headache. Perhaps we could use tariffs as a fall back position in a free trade package. So we establish/renegotiate FTA's with nations, but part the covenants dictate the signatories do not subsidize domestic industry. Doing so would default to the establishment of a tariff on the subsidized products.

 

[T.Lex]

Do you accept the need to maintain a healthy domestic metals production capability? Because if you do, I'm not sure how you can put domestic industry at a competitive advantage against other players who subsidize the costs of their domestic industry output, rather than allowing said industries to deal with the consequences of over production, and then look the other way as they dump that overproduction

But - and this is where I chalk it up to a novice politician/policy-maker - we can encourage domestic production without a punitive tariff. Tax breaks, domestic subsidies, re-shoring of procurements from domestic steel manufacturers are just a few things that we could do to address the problem - if that's the "problem" to begin with.

Yeah, others would complain about the preferences, but it would be a much longer road to a trade war than announcing 25% tariffs. Even if he intends to walk it back (now he's saying he was using it as a negotiation point for NAFTA), he could build actual leverage in smaller steps.

But, those wouldn't be nearly the distraction that he needs....

 

[Alpo]

domestic subsidies....that is corporate welfare, Jocko.

You just cut their tax rates over a Trillion $.

 

[BugI02]

But - and this is where I chalk it up to a novice politician/policy-maker - we can encourage domestic production without a punitive tariff. Tax breaks, domestic subsidies, re-shoring of procurements from domestic steel manufacturers are just a few things that we could do to address the problem - if that's the "problem" to begin with.

Yeah, others would complain about the preferences, but it would be a much longer road to a trade war than announcing 25% tariffs. Even if he intends to walk it back (now he's saying he was using it as a negotiation point for NAFTA), he could build actual leverage in smaller steps.

But, those wouldn't be nearly the distraction that he needs....

[I wanted to highlight that text in yellow in homage to the journalism on display, but it wasn't really readable ]


View attachment 64593

 

[BugI02]

No, I get that, but I'm not sure shooting ourselves in the head is the best cure for a headache. Perhaps we could use tariffs as a fall back position in a free trade package. So we establish/renegotiate FTA's with nations, but part the covenants dictate the signatories do not subsidize domestic industry. Doing so would default to the establishment of a tariff on the subsidized products.

Perhaps review #83 to see how that is playing out. Sometimes a credible threat means you have to follow through

 

[Woobie]

Perhaps review #83 to see how that is playing out. Sometimes a credible threat means you have to follow through

I don't know the specifics of our current trade agreement with China, but a violation on their part does not constitute a global tariff. Negotiate individually and enforce individually. That puts the onus on the other party if we enforce the tariff.

But I will agree that if we bark in an agreement, we need to be willing to bite.

 

[T.Lex]

Post 83 partially explains why we don't need a tariff - against a bunch of not-Chinas.

If China is guilty of the stuff the Commerce department says it is, then we have the ability/opportunity/justification to act only against China.

 

[BugI02]

From #83

... As of February 15, 2018, the U.S. had 169 antidumping and countervailing duty orders in place on steel, of which 29 are against China, and there are 25 ongoing investigations.

Only around 1/6 of the complaints are against China. It seems clear to me the other guilty parties are ... not China. So if we want to act against a wide array of competitors who have their thumb on the scale, a general tariff would be the way to do it

 

[BugI02]

I don't know the specifics of our current trade agreement with China, but a violation on their part does not constitute a global tariff. Negotiate individually and enforce individually. That puts the onus on the other party if we enforce the tariff.

But I will agree that if we bark in an agreement, we need to be willing to bite.

Those antidumping and countervailing duty complaints mentioned in #83 are attempts to address the problems within the framework of agreements, and it is not working. And a general tariff gets around the the problem of trans-shipment (such as Brazil shipping steel to Peru to sell to the US to do an end run around a potential targeted tariff on Brazil). If it's imported, it's subject to tariff

 

[Woobie]

Those antidumping and countervailing duty complaints mentioned in #83 are attempts to address the problems within the framework of agreements, and it is not working. And a general tariff gets around the the problem of trans-shipment (such as Brazil shipping steel to Peru to sell to the US to do an end run around a potential targeted tariff on Brazil). If it's imported, it's subject to tariff

It doesn't sound like they are enforcing the type of penalties I am talking about. I said we need to renegotiate and implement stiffer penalties, then enforce them. What is being proposed by Trump is going from fisticuffs directly to nukes. And we are inside the blast radius.

Trans-shipment isn't the hardest thing in the world to catch. If the quality or quantity of the product doesn't match the stated country of origin, you nail them. They did it with honey, for Pete's sake. They can do it with steel. There aren't many countries in the world that put out the quantity and quality of Chinese steel. Now I know it isn't the greatest stuff, but if we start getting tool steel from the Sudan, it should raise red flags. Or if all of the sudden Malaysia starts putting out 200x their know capacity, we might know something is amiss. Having established the existence of fraud, you nail all of the countries involved. No need to take a JDAM to a knife fight.

 

[Woobie]

From #83




Only around 1/6 of the complaints are against China. It seems clear to me the other guilty parties are ... not China. So if we want to act against a wide array of competitors who have their thumb on the scale, a general tariff would be the way to do it

Or make an example of China and if the others don't get the hint, nail them one by one until they do. A general tariff is the worst way to accomplish this.

 

[T.Lex]

Or make an example of China and if the others don't get the hint, nail them one by one until they do. A general tariff is the worst way to accomplish this.

Quick, narrowly tailored point: a shooting war would be worse.

But, in the annals of history, a punitive tariff is sometimes a direct precursor to the bangsticks.

 

[Woobie]

Quick, narrowly tailored point: a shooting war would be worse.

But, in the annals of history, a punitive tariff is sometimes a direct precursor to the bangsticks.

Agreed, shooting war is even worse.


Punitive tariffs are on the road toward war. Does that mean if you stop at that exit you have committed to continue down that path? If we don't impose punitive tariffs, have we made war more avoidable? Not sure. But I will say you can put the ball in their court by linking the tariff to hostile economic activity by the other party, and drawing that line during trade negotiations. In general, people react much less violently when things are in writing before hand.

 

[T.Lex]

Indeed.

The good news is that Trump says alot of things that he doesn't follow through on (either by choice or circumstance). Its probably even odds that he's just jerking the chain A) because he can and/or B) it distracts.

 

[Thor]

A weeble wobble wobbles but it don't fall down.

Sorry, I'm not too far removed from having toddlers in the house.



Apple predictive text is amazing. Once upon a time I abbreviated National Guard to NG. Forever after, any word that ends in "ng" gets corrected if I mispell it. So if I intend to say "looking" and type "looksng" it might try to correct that to "look NG".

That's funny...I was building an intel briefing once and the computer kept trying to turn Muammar Gaddafi into Momma Cadaver...which now is more descriptive of his situation.

 

[BugI02]

Quick, narrowly tailored point: a shooting war would be worse.

But, in the annals of history, a punitive tariff is sometimes a direct precursor to the bangsticks.

I am assuming the shooting war under discussion would be with China (although I guess its possible you're worried about the Canadians wanting an excuse to undo 54 - 40). Would broad tariffs not singling out only the Chinese be more or less likely to lead to a shooting war with the Chinese

 

[T.Lex]

I am assuming the shooting war under discussion would be with China (although I guess its possible you're worried about the Canadians wanting an excuse to undo 54 - 40). Would broad tariffs not singling out only the Chinese be more or less likely to lead to a shooting war with the Chinese

Historically, yeah.

But by targeting them (word choice intentional), we avoid a broader trade war with our allies.

 

[BugI02]

I am confused, what is your most desired outcome:

A) Avoid a shooting war with China
B) Avoid a trade war with our allies
B[SUB]1[/SUB]) Avoid tariffs altogether (limiting choices to only A or B intentional)

 

[T.Lex]

I am confused, what is your most desired outcome:

A) Avoid a shooting war with China
B) Avoid a trade war with our allies
B[SUB]1[/SUB]) Avoid tariffs altogether (limiting choices to only A or B intentional)

Again with the false di-/tri-chotomies.

My most desired outcome is for USian companies to make a ton of money. Ideally, that would be domestic manufacturing, but I'm not as married to that as some are.

A secondary goal is stability. That works better for everyone. Chaos has a cost.

A subset of stability is that there are certain kabuki theater aspects of this kind of thing. We can make a point by taking known, perhaps even expected, steps down a path toward punitive measures that are far short of a punitive tariff.