Tariffs Already Hurting Many Americans

I was going to make this a QOTD Part 2: Tariffs.   In the original QOTD on tariffs I pretended that I knew absolutely nothing at all about such things and could you please help me out cuz, you know, you guys are much smarter than me.   Well, about half of you, maybe even more, said tariffs are great.  You gave various reasons …. most of which were based on emotions; — “we’re getting screwed , man!!!!” — rather than facts. So, I was gonna ask:

Q: After reading the below two articles will you tariff lovers from the previous QOTD admit that you’re basically fucken morans?

Well, this is NOT a question of the day … mostly because I know you won’t admit you’re a moran … however, if you are a moran, and wish to admit to this major malfunction, then feel free to do so.

Anyway, I read  this article in today’s NY Post.  It’s about the 30% increase in cost of newsprint … which has already resulted in hundreds of jobs being lost, and thousands more in danger.  All to protect a mill in WA with 300 employees from the eeeevul Canadians.

Then I just read the article below moments ago. It’s more than just newsprint. Or Harley Davidson.  It’s affecting a boatload of industries.  And if you morans who think tariffs are great  … and if you would just stop and reflect how goddamned ignorant you are … then I will forgive you and respect you in the morning.  Otherwise, blow me. Same goes for Trump.

The Trade War Is Already Having A Huge Impact On The U.S. Economy

The trade war has barely just begun, and yet significant ripple effects are already being felt all across the U.S. economy.  Once thriving businesses are on the verge of failure, workers are being laid off, and some sectors of the economy are witnessing enormous price hikes.  Right now the mainstream media is absolutely fixated on the drama surrounding the recently concluded Trump-Putin summit meeting, but the consequences of this trade war will ultimately be far more important for the lives of most ordinary Americans.  As more tariffs continue to be implemented, this will perhaps be the biggest disruption to the global economic system that we have seen in decades.  Perhaps you have not been affected personally yet, but for many Americans this trade war has changed everything.  For example, just consider the plight of soybean farmer Tim Bardole

The U.S. is China’s second-biggest source of soybeans at 34% of the imports, after Brazil, which ships 53%. The staple is used to make cooking oil and seasoning, and soybean meal is found in pig feed.

Now the tariffs have taken the bottom out of U.S. soybean prices, delivering a gut punch to farmers like Tim Bardole. He was already $100,000 in the red last year due to a years long slump in cereal prices, and the current predicament has driven him into a corner.

“I’m not sure if I can get a loan from the bank to finance our next year’s crop,” said Bardole.

If this trade war had not happened, perhaps Bardole would have been able to eventually get out of debt.  But now he is facing financial ruin and the potential loss of his entire farm.

Switching gears, U.S. consumers will soon discover that common electronics such as phones and computers cost a lot more.  The following comes from CBS News

Buyers in the U.S. will soon see price hikes on computers, phones, thermostats and “everyday items,” according to the Information Technology Industry Council, a group that represents tech companies.

Hundreds of Chinese components that the Trump administration penalized are used to make everything from LEDs to sensors to printer and scanner components. When manufacturers pay more for their parts, the costs are typically passed on to consumers, the ITI said.

Are you ready to pay 50 dollars for your next phone to support this trade war?

Maybe.

50 dollars is ultimately not that big of a deal.

But what about paying $9,000 more for your next house?

Tariffs on lumber coming from the evil Canadians are adding about $9,000 to the cost of a new house, according to the National Association of Home Builders.

Washing machine prices have jumped some 15% this year, the fastest increase ever recorded by the Bureau of Labor Statistics.

Are you starting to understand why starting trade wars with all of our major trading partners simultaneously was a really bad idea?

We are about to see major price hikes in just about every sector of the economy.  According to the Alliance of Automobile Manufacturers, the average American could pay over $5,000 more for their next vehicle

Consumers may see an average price increase of $5,800 if a 25 percent import tariff that Mr. Trump has threatened goes into effect, according to estimates cited by the Alliance of Automobile Manufacturers (AAM), a lobbying group for carmakers.

That’s a “$45 billion tax on consumers,” the group said, citing an analysis of Commerce Department data.

U.S. consumers are already stretched to the max, and they will not be able to easily absorb these price increases.

Meanwhile, farm incomes all across the interior of the country are going to be absolutely devastated by this trade war.  Just check out these numbers

The American Farm Bureau says it expects farm incomes to drop to a 12-year low this year, largely because of the trade war.

An agricultural economist at Purdue University, Christopher Hurt, added that 1,000 acres of corn and soybeans would have made a farmer a $42,000 profit on June 1. Now, it could net him a $126,000 loss.

And as I mentioned above, many businesses all over the United States that rely heavily on exports are already struggling so mightily that they have to lay off workers.  The following comes from USA Today

In Poplar Bluff, Missouri, Mid-Continent Nail, the nation’s largest nail maker, laid off 60 workers last month. Sales plunged 70 percent after Trump placed a 25 percent tariff on steel from Mexico and Canada. When the company boosted its prices, customers defected. Now, Mid-Continent is strongly considering a second round of 200 layoffs, company spokeswoman Elizabeth Heaton says, and all 500 employees could be axed by Labor Day.

Yes, we desperately needed to do something about China and other trade partners that were taking advantage of us.  But there is a right way to handle things and a wrong way to handle things, and starting a trade war with everyone at the same time is a really, really bad idea.

I think that a recent piece by Thomas Grennes, a professor of economics at North Carolina State University, made this point quite well

The Trump administration has said that tariffs are a negotiating technique that need not be implemented. Now that tariffs are in place, they say other countries will soon back down. However, trading partners have not backed down, and, in fact, retaliatory tariffs against U.S. exports are already in place. Foreign officials have expressed confusion about exactly what concessions the US government wants. Currently, no formal negotiations are taking place. Higher future tariffs are being announced regularly. There are no signs of an end to this tariff war. When will both sides recognize that interfering with voluntary trade is harmful to both parties? Trade wars are lose-lose propositions.

Unfortunately, I don’t think that most Americans have any idea how exceedingly painful this trade war could potentially become.

The longer it lasts, the worse things will get, and ultimately it could tip the U.S. economy into the worst recession that any of us have ever experienced.

http://taxous.com/2018/07/the-trade-war-is-already-having-a-huge-impact-on-the-u-s-economy/

Author: Stucky

I'm right, you're wrong. Deal with it.

82
Leave a Reply

avatar
  Subscribe  
Notify of
Mary Christine

I’m not touching your question with a 10 ft pole, not my area of expertise, either but as far as Harley Davidson goes, they were hurting before tariffs, though I’m sure that was a nail in the coffin.

Who can afford their overpriced bikes, anyway? I’m always amazed to see someone riding a Harley and living in a hovel. My husband loves them, though.

https://www.marketwatch.com/story/harley-davidson-sales-decline-continues-2018-01-30

“Harley-Davidson Inc. on Tuesday reported its fourth straight year of declining sales as the Milwaukee motorcycle maker struggles to get more riders on Hogs.”

I’ll be interested to see who will admit to being a moran, though.

Llpoh
Llpoh

Mary – you say their bikes are over-priced. Same attitude as why we have so many imports – US goods are over-priced, or so people think. But by buying foreign made, they increase the cost of US goods further, and lessen the cost of foreign, by altering the balance of economy of scale. It is cheaper per widget to make 100 widgets than 10.

People do not want to pay the price of American made. Harley is not so much over-priced as it is priced at the cost of American labor and overheads, not the price of Chinese.

Mary Christine

Llpoh, I replied earlier but it disappeared into cyberspace. It’s a personal preference. I wouldn’t buy one for myself. They are overpriced, I think. But I can’t throw stones since I own Cutco knives and just bought a few more. So there you go. It’s what’s important to you, personally.

If we had money to burn, we would probably have a Harley. There is a big difference between a Harley and a few American made knives.

I wouldn’t buy new furniture. It’s crap. We bought a forty year old dining room set that I am repainting.

James
James

Llloh,while I actually up pointed you as not sure why you got so many downs(hate the widgets,slows loading)believe Harley is in trouble not because made in US but because like many businesses when they got very popular in the 90’s thought could never end and end it did as that gen stopped to a degree riding.The dealers/private sellors would not negotiate/increase capacity and thus alts like big dog/victory ect. came into being(some now dead,some still in business),the arrogance of the company and owners of said bikes long term got the better of them.I love v-twins,would though get a frame/big SS motor and go from there and build what I want.

Trump may have a limited window of opportunity to get things done,hence the straight out hits to nato/tarrifs ect.,other potuts’s sure have not done it or screwed us worse even with nafta ect.We have tried the slow/long drawn out approach to what seems no better results,fuck it,run the bulls in the china shop!The world economy no matter what will take a hit at some point due to basic math,and again,when that happens rather a Trump then some of the alts we were provided(forced upon us).

As for who is a moron,well,New Jersey will do that to ya’s.

Anonymous
Anonymous

We should go on the gold standard.

That way we’ll end up with all their gold for ourselves as they send it to us to make up the difference with their gold for how little they send us in trade goods in return for how much we send them in trade goods to balance out their trade deficit with us.

PlatoPlubius

@ AnonMoran

Really? If the U.S. went on the gold standard it would be a terrible sodomizing with no lube!

The gold in Fort Knox has never been audited! Cuz, it isn’t there!
Long ago after FDR passed the emergency acts to confiscate Americans gold, it was given to the FED RESERVE as collateral towards our unpayable debt….(minus ALL the interest the social security trust fund has been accumulating on each of our STRAW MAN that was created at BIRTH when our parents inwittingly signed us up into this “system”)
I wonder how much $$$ will be gained from the collection of the life insurance policies once the American LIQUIDATION is complete of U.S.A. CITIZENS.

Anyways, going to a gold standard would ONLY benefit those countries that have been actively stacking the gold for decades?…..hmmmm…..I wonder who that might be…many can be found within the BRICS nations.

Anonymous
Anonymous

So you oppose the gold standard and want to rely on Fed fiat instead?

PlatoPlubius

No, I didn’t say that…the FED is more like a funnel anyways as Damon Vrabel mentions in his Debunking Money series

The fiat isn’t the biggest issue, it’s the debt associated with each dollar created into existence that IS!

Even ending the FED won’t fix the problem as he explains…

We be fucked bro! Barter at local level…some had suggested creating local currencies that could be used to pay city taxes to create demand…and eventually would be accepted at more places within your city limits to purchase or trade for other necessities or services…

Anonymous
Anonymous

So you’ve just given up?

PlatoPlubius

@ Anon
Nope, just come to the realization that the way this clusterfuck has been engineered, ALL ROADS lead to the destruction of the U.S. dollar!

Prepare as best you can as many have been doing for decades…the pace in devaluation is accelerating in this global rigged game of Hot Potato within the race to the bottom aka currency wars!

Somewhere just recently I read the thought that with all these tariffs places on China, would China devalue the Yuan to make them moot?

Something to chew on since it fits into my understanding of the desire to devalue your country’s currency to boost appeal for your exports…aka the race to the bottom!..

Give up? I wouldn’t be here if I gave up brother!

There are way more important battles to be fought for men’s souls, whether you believe you have one or not.

PlatoPlubius

@ Anon et al,

Ever hear of the financial stability board? In 2006 Obama signed on to the G20 agreement to give the Financial stability board, formerly known as ths financial stabiloty committee, FSB oversight and control of our Federal reserve system.
A supranational institution controls our banks that supposedly run our country….this is why Damon Vrabel referred to the FED as a funnel or spigot…

Ignorance can harm us…thia is why knowledge is power.

James
James

I would propose our currencies were backed by a basket of solids which gold would be just a part.

CCRider
CCRider

You can’t legislate wealth creation-just winners and losers. But I get the emotional appeal. People who have been screwed over by the dummos and repos in favor of their owners don’t give a shit about proper economic rationale. They want someone to kick ass and Trump is doing that.

Jack Lovett

A war between 2 piss ants is not good. War is so, not nessesary,ever. Perhaps we try and be honest with oneanother,whether it be indivduals or countrys. No cheating,stealing,deception. More brotherly love works.

Anonymous
Anonymous

War -conflict- is the natural state of man, as history demonstrates so well.

Per/Norway
Per/Norway

not true, you only think so bc the “scholars” only write about them.. if war was the natural state of men why do 90% of normal humans just want to live their lives peacefully? dont judge humanity on the actions of a few and the stupidity of the worlds “morans”:)

bigjim
bigjim

Sorry to have to correct your misspelling but “moron” is the word you should be using instead of “Moran.” Look it up, gov.

Administrator

starfcker

stop picking on Hardscrabble

deplorably stanley
deplorably stanley

I thought it was maroon.

Javelin
Javelin

I don’t fully understand the logic….so we will return to a freer market and truer supply and demand? Grow something else more profitable if soybean demand is down. Lots of opportunity for electronic start-ups it seems….if buyers are switching to other nail manufacturers in the USA selling cheaper, then upgrade your foundry or cut profits. Three to 5 years down the road these things will work themselves out. Sounds a lot like the “bail out the banks or the streets will be burning”….We must stop the bleeding of national wealth at some point. Why kick the can until the decision or collapse makes it for us? How many American businesses already suffered or died because of cheap foreign labor and prices? How many businesses shuttered or already at their end? I suspect this could lead to a revival of American manufacturing…let the free market dictate costs.

Anonymous
Anonymous

Labor is the primary cost factor.

When you can’t compete, cut the workers wages till you can.

Javelin
Javelin

Or let prices escalate some on non-essentials, then maybe people will live within their means.

PlatoPlubius

The opposite will happen…

Prices for non essentials will remain cheap while things that everyone uses will continue to go up!
Buy butter lately? Gasoline?
But hey I can get a flat screen t.v. for $100 …

Remember that most of the U.S. economy is built around the service industry and minimum wage jobs….we wonder why student loan debt continues to skyrocket? It ain’t just cuz of the tuition rates either…

Llpoh
Llpoh

Jav – even if manufacturing “returns” – it never left by the way – there will be very few jobs created by it. Manufacturing is very automated these days, and will be increasingly so.

Llpoh
Llpoh

This stuff has and will have severe unintended consequences. The US exports aroind one trillion dollars a year in goods. That is substantial. It imports around $1.5 billion, and that is indeed a problematic differential. But to fix that issue by brute force will indeed affect the exporters, and it will affect importers as well.

In my biz, we have experienced significant material cost increases, many attributable to the trade war. The increases are probably not a result of actual tariffs and retaliation, but are more likely a result of a fear of such. So tariffs have not just a direct impact, but an indirect one as well.

I am aware of businesses beginning to struggle that are being hit by these price increases. Some will go broke if it cintinues.

There will be a significant lag effect. This stuff will not happen instantaneously. Prices will go up, companies will fail, unemployment will go up, and then, after a significant delay, the void may be filled. I emphasize may. But there will be a gap between the loss of jobs, business, goods and any restart. And that will be painful.

It may give other nations incentiveto start supplying gods the US currently exports. That would not be a positive outcome.

This is a very complex market being screwed with. The outcomes are very uncertain, but the pain, be it temporary or possibly permanent, is certain to occur. The answer has always been to voluntarily stop importaing goods and to buy American. I have posted links on where to get American made goods.

I do not know exactly how this will end. I know how it will progress – very badly indeed for a lot of people and busineses. But my general belief is that artificially driving up costs will end poorly.

Anonymous
Anonymous

Well, “washing Machines” aren’t jumping in price because of tariffs. It’s because of the mindless effort to computerize these things (and more) for no actual purpose than cachet.

I was in an appliance place a couple weeks back … they had a Drier … $2995 “on sale.” Normally $4000. People were actually looking at it. WhoTF spends $3000 on a clothes drier?

Llpoh
Llpoh

Those dryers use heat pump tech, which is vastly efficient. I doubt they save enough electricity to cover the difference, but they cost almost nothing to run compared to a normal dryer. You can get a heat pump dryer for about double the price of a standard dryer, though. The $3k is ridiculous expensive. But some folks have the money and are happy to spend it on incremental benefit.

PlatoPlubius

@ LLPOH
You said,
“But some folks have the money and are happy to spend it on incremental benefit.”

Yeah, these folks buy the hype and are MORANS!

But at least their “smart” dryer will send them an update to their phones to let them know their clothes are dry….
Bwahhahahaha

Robert (QSLV)
Robert (QSLV)

DRYER.

comment image

Robert (QSLV)

nkit
nkit

Thomas Grennes hit the nail on the head (sorry) when he said: “When will both sides recognize that interfering with voluntary trade is harmful to both parties?”

https://mises.org/wire/free-trade-versus-free-trade

MrLiberty
MrLiberty

We banned Hemp in the 30s, in part to protect Hearst’s burgeoning wood pulp paper industry (among several other industries). Our nation was founded, in large part, by Mercanilists who wish to establish an American system of mercantilism (crony capitalism) that mirrored the British version they wished to free themselves of. Protectionist crony capitalism/economic fascism/mercantilism, has been the driving force that has fueled the growth of government power and control over our economy since 1776 (and before). Of course the entire system is founded on immorality, force, violence, and the destruction of freedom and liberty. It wouldn’t be very “Murican” if it weren’t.

Zarathustra

Even if tariffs were wonderful, I would fully expect their implementation to be a disaster because ‘murika.

Anonymous
Anonymous

Trendy new gadgets, with the latest in computer tech and digital display…and the cheapest components. Disposables now, when they crap out. Shell out more savings for another new appliance.
There’s something to be said for finding older, plain jane home appliances, tools, etc.
They made these with better quality 10, 15, 20 years ago.
And back then, if it needed repair, the parts and labor didn’t cost more than 50% of your original purchase price.
Now? Phock it. Junk it, and buy a new one. Maybe it will last 3 or 4 years.
Lift up and feel how light and cheap a new toaster is. Junk.
Then lift one like Granny used to have if you can find one. Built like a tank. The burner filaments were thicker core wire, and could withstand years of resistance heat, without going brittle, and failing. Same with old incandescent light bulbs.
That said, the LED lights are way more energy efficient.
But hell, Energy Star appliances are cheaper quality now.
Draw the parallel to what Eric Peters says about car quality and part failures.
Both are due to gov. mandates.
And so it goes…

karl
karl

I use a 1953 Hotpoint ( GE ) refrigerator. I have a 1954 one as a spare . It cost $ 5 at a garage sale 20 year ago. It is the ‘waiting’ spare.

Llpoh
Llpoh

You could probably have paid for a new one with the cost savings on electricity. Those old ones chew through power. Things are not always as they seem.

Robert (QSLV)
Robert (QSLV)

I have to agree with Lioph on this one. I unplugged my 50’s Frigidare and my electric bill went down $65 / Mo. Plugged in a new fridge and it went up $10 / Mo. Good enough for me.

Robert (QSLV)

doug
doug

Aren’t Tariffs just a poor method of equalizing currencies? Why not be honest and negotiate a more equal currency exchange. Stop competing with importers who pay their workers a pittance because their cost of living (and government) will allow it. My 2 cents…

Coalclinker
Coalclinker

You know I read about “business” people bitching about how the tariffs are affecting their business and how they can’t buy the Chinese raw materials to make their cars, appliances, nails, motorcycles, or whatever it is. Well, where I live here in the once prosperous Mid-Ohio Valley all of the steel mills, glass factories, brick yards, shoe factories, and everything else that made these materials shut down because of the imports. No one cared and all they do is make fun of people from Appalachia because of the social problems created by this. I say FUCK EVERY ONE OF THESE GODDAMN PEOPLE. Our ox got gored, and now it’s YOUR turn. I have utterly no care nor concern about these Johnny-come-lately whiners and carpers. Some people are saying this will lead to war and the loss of many lives. So what? People can die and then more people can be fucked into existence just like it always has been since the beginning of time.

Dave
Dave

I’m somewhat elderly and technologically challenged. How will I know that these tariffs are screwing me? Or do I just believe someone that is telling me they are?

Llpoh
Llpoh

Your pocketbook will tell you. You will immediately get screwed, but benefits may come later. But I doubt it.

Llpoh
Llpoh

I tried to post a couple of times but WP had its own ideas about that. The gist of the posts is that the US is a major exporter and many exporters will be hurt, many local businesses will be hurt by rising costs, some costs will rise because of fear of tariffs rather than actual tariffs, that brute force attempts to reduce imports is not likely a good strategy, that the outcomes of a trade war are difficult to predict, and that tariffs may create outside competitors to fill any voids.

There will be a lot of pain early, and it will take time for US companies to fill any voids created by declining imports – assuming the void is filled at all. Many imports will continue unabated, just at increased costs.

I suggest that this will not end well for a great many. More and more reports of business failures are surfacing along with job losses. And the tariffs really have not yet taken hold – so far much of it is fear associated.

There is every chance Trump will be out of office before any potential benefits will be seen. The pain will be felt immediately, but benefits, if any, will come much later, as there is a significant lag between void being created and capacity coming on line. And that all assumes a willingness to invest, and available capital to do so.

Fulton

All four presidents on Mount Rushmore believed in protective tariffs. Who the hell are you?

Llpoh
Llpoh

A businessman. Who the hell are you? I am guessing you are an imbecile. Am I right? Come on, I am right, aren’t I? Keep posting so we can verify my guess.

L
L

LoL funny rebuttal, big dog.
Put him in his place.

hardscrabble farmer
hardscrabble farmer

Where to start?

There are so many falsehoods and flat out lies in the cited articles it seems foolish to even address them. It’s like arguing with the Heaven’s Gate cult about the amount of quarters they need to hitch a ride on Hale-Bopp.

But since it’s all academic, let’s start anyway.

Raising soybeans on the same piece of land 20 years in a row isn’t farming, it’s strip mining. Doing it so you can export it to China so they can feed it to pigs that they’ll sell back to us at prices far lower than an American family farmer can afford to sell his pork for is a betrayal, a form of treason so obvious even a retard can understand it, but somehow the wankers who rubbed out the analysis were unable to even touch on those aspects. I don’t care if he loses his “farm” when the notes come due for his Monsanto seed and his Roundup because ager delenda est. He made a deal with the devil and if tariffs are the settlement on that contract, so be it.

The same goes with the lumber tariffs. Prices on timber in the US have fallen so low that it’s hardly worth cutting, I know, I live in one of the top producing states in America. So how is it possible that an additional 20% cost to Canadian imports would have any effect on the availability of lumber in the US? Do people in Canada cut faster? Work longer hours? Use a different kind of technology that allows them to undercut us by such margins and still profit that Americans can’t equal their production? Don’t be ridiculous/ Canadians subsidize their lumber industry which is a nice way of saying they rob their taxpayers and bribe the timber industry with huge payoffs to sell the lumber for less than it costs to produce and ship. And we’re supposed to welcome that kind of behavior even as it penalizes our own domestic lumber industry? What kind of rat hole does one have to go down where screwing your neighbor in order to benefit off the theft from your other neighbor is copacetic?

There is no “cheap” food, or lumber or any other thing. There is debased currency and there is a myriad of slavery and theft that helps to conceal the larger criminal enterprises of governments and NGO’s that bamboozle and manipulate people into believing that all they are doing is getting a good deal when they’ve become accomplices to these crimes.

There are an admitted 350 million human beings living in the USA, probably another 50 million various and sundry unaccounted criminal parasites living among us. That’s a vast pool of economic opportunity from which to draw our sustenance. They all have to eat, and sleep somewhere and change their underoos every couple of days and if it costs a little bit more then I guess they’ll have to cut back on some other area, like cell phones, flat screens and skunk, but something tells me they’ll find a way.

IluvCO2
IluvCO2

A-Fucking-Men !

PlatoPlubius

@ HSF

EXCELLENT POINTS! BRAVO!

What you described about the soybean farmer is exactly the root of the clusterfuck referred to as globalism…

These fucks have negotiated trade agreements like NAFTA, CAFTA, AND GATT to make country and economy dependent upon one another…
John Perkins details the role of what he coined to describe himself and others like him, ECONOMIC HITMEN…in his amazing autobiographical retelling of his career in CONFESSIONS OF AN ECONOMIC HITMAN.
The story of the soybean farmer sounds similar to what has happened to the farmers here in California who stopped growing peaches and planted almonds because of its cash crop value in the global marketplace….
I’ve read many articles in local papers that suggest these tariffs will negatively impact California farmers in the long run…

Unless China devalues its currency in response to the tariffs…

James
James

Plato,saw a lot of the almond farms letting trees die/cutting em down to what I thought was water issues,just a way to raise prices while getting govt. handout?I will say this was three years last time I was in the land of “fruits and nuts”.

PlatoPlubius

I am sure some of it is due to the water restrictions, the delta smelt and let’s not forget the housing collapse of 2008…
From Fresno to Stockton, we still haven’t recovered ….oh sure some people have profited like always but many fields lay fallow, many generational family farms sold….
This is why I say we are living through the Greatest depression in recorded history…
And we wonder why people are pissed off with the news….
They try and make it like everything is the individual’s fault while they lie to us about how great the economy and job market is

Llpoh
Llpoh

HSF – I do not think the US imports much pork from China. But it exports a lot to China. The soybeans are used to grow pigs for local Chinese consumption.

Re lumber, Canada does not directly subsidize the industry. They allow harvesting on public lands under long term contract. The US lumber is largely harvested from private lands. The dispute is over the rates Canada sets for the lease of its land, some of which were set a long time ago. It is important to consider that the US exports a lot of product and, esp., services to Canada. There will be unintended consequences in a trade war.

Interestingly, the US spends around $25 billion a year on farm subsidies. Wonder how much of that is exported, and at what costs to Americans? And how much damage that does to farmers in nations that import US produce?

This is very complex stuff. It is rife with special interests, subsidies, etc. The entire system needs reset. It is the height of hypocrisy for the US to scream about the inequities of subsidies while doing the same thing.

hardscrabble farmer
hardscrabble farmer

China owns the largest pork producer in the US. Since they feed their pigs soybeans and the US is the single largest supplier of soybeans to China, it would be a safe assumption that they are feeding them US produced soybeans, c’est nes pas?

And if allowing private industry to harvest publicly owned timber is not a subsidy, I’d like to know a more fitting term. Canadian timber prices have crushed the US lumber industry in the past 10 years.

And the population of Canada is less than that of California, I think that we will be able to make up for whatever losses we may have to deal with if Canada stops buying our widgetry.

You’re correct, the whole thing is complex and there are untold numbers of unintended consequences that arise from the imposition of tariffs, but to even pretend that the US hasn’t been involved in a long running trade war with multiple nations including some of closest “allies” is a silly notion. A good hard dose of reality in terms of economics would be in our best interest long term.

But that’s just like, my opinion, man.

Llpoh
Llpoh

HSF – US subsidized soybeans flow to China. US pork does, too. US pork is also subsidized via the soybeans.

The US also allows harvesting from govt land – about 30% if my data source is correct. So US timber is also subsidized, but to a lesser extent. Canada ships in around $6 billion of softwoods. They are the biggest exporter to the US, but other nations have a very high rate of increase in recent years.

Just because the US or Canada lease govt land does not make it a subsidy – only if it is done so at below market rates on the date the rate of lease is set.

I dunno. Where does it end? The US subsidizes all kinds of things. So does Canada. I take your point re the govt land. But if the govt lease is pegged at market value on the day it is set, as Canada claims, then demand explodes, is it reasonable to claim that they have done the wrong thing? I dunno. The US collects mining royalties – similar to the Canada system. Are they really subsidies? Especially if mineral prices soar after leases are set? I dunno.

The US is not innocent in this stuff. They do they same thing in spades, then scream bloody murder when it switches around. The pork barreling is rampant.

Which is why I think these trade wars are so unpredictable, and why I think that folks who conclude the US will be better off with tariffs in the longish run may well be mistaken. The tentacles reach into every corner of the market.

There should be zero govt subsidies. But that is not the situation. Putting tariffs on Canada for theirs leads them to put tariffs on because of those the US has. Soybean subsidies flow through countless industries indirectly, for instance. Where does it all stop?

It should just all stop. The US should clean up its subsidy system. Canada should clean theirs up.

overthecliff
overthecliff

The hypocrisy goes both ways. Therefore , it’s not free trade.

Rdawg
Rdawg

HSF can I have my braseola? I sent you two e-mails with no response.

Anonymous
Anonymous

bresaola, moran.

Rdawg
Rdawg

I spelled it the same way HSF did in his solicitation to buy, fuckstick.

Unsubsidized
Unsubsidized

Fantastic commentary and information on this thread. TBP is a digital gem.

Thunderbird
Thunderbird

Why are we trying to become energy efficient? Why when there is so much energy all around us in different forms. This mentality is a poverty mentality.

When america was manufacturing it’s own durable goods it was manufacturing high quality long lasting products. They didn’t engineer energy efficient because that means lower quality.

We have entered an era of producing quantity rather than quality. With the population increasing as it is we better be concerned with the rapid depletion of natural and artificial resources. That means we better start producing quality again so we don’t waste the natural resources we have left.

Tariffs will no doubt disrupt that status quo. Does anyone really think change comes without discomfort? The universe is nothing but change in all sorts of energies. Change is a constant and if one can’t handle that then all one can do is pound sand; or get negative.

I’ve heard the mines are already increasing production. That is a good sign for domestic manufacturing. Hemp is now becoming legalized so that will be a boon for soft manufacturing.

AI is not going to completely take over human functions because human will is superior to AI in adjusting and confronting the changes and contingencies that go on in manufacturing. AI can only do it’s programmed functions. Humans can rapidly respond creatively to contingencies.

I am looking forward to the changes coming. It is about time.

James
James

Why am I trying to be energy efficient,so perhaps I can be off grid and still have some basics.That said,will not be buying any appliances that have computers ect.,hate working on that stuff,I can when if needed fix the old.

Vodka
Vodka

When the trade deficits are this huge for the U.S., there is no way to “lose” a trade war. Expect the people who benefit from the previous arrangement (soybean farmers, newsprint purchasers etc) to tell their anecdotal tales of “whoa”.

HSF already nailed it, so I’ll spare you any further rant.

miforest
miforest

no tariffs , no nation. tariffs are the only defense against globalist usury . farmers are always the biggest crybabies. the ag subsidies, set asides,marketing programs , price supports and countless other federal programs make them some of the biggest welfare queens too.

Penforce

The first responsibility for any government that wants to stay in power is to guarantee the food supply. All the ag programs and subsidies may appear to be handouts but are really just the power broker’s insurance policy payments. I can’t imagine this nation returning to an agrarian economy any time soon, unless unforeseen events knock us back a hundred years. Todays agriculture is petroleum based, but what are the other option? Organic inputs aren’t available in scale, and are cost prohibitive. Bat shit and seagull dung were used up in the 1800s. When you harvest a crop and it leaves the farm, something must be returned from off the farm to make up for what was sold away. There is no easy way to feed 300+million people. Natural is a word best used when discussing pubic hair color.

Oldtoad of Green Acres
Oldtoad of Green Acres

A swirling blog of drooling jabbering and enlightened prose.
Hard sometimes telling which is what.
Stucky reminds me of a screaming piss ant on a soap box with a large crowd is cheering him on. Remarkable, entertaining.
Thanks a lot.

Llpoh
Llpoh

My stuff is the enlightened part.

i forget
i forget

Bird(brain)s of a feather flock together to tariff & feather ‘the other’ feathers they see in the mirror.

1st rule of cuckoo’s nest fight club is brood parasitism: keep tarring & feathering your own ass nest, cuz s\he ain’t heavy, s\he’s my brooder.

Floggin’ roosters are despicable (Morrill tariff&feather, that time), but what word then for the roosted upon who love being ruled, under cover of righteous tariff•eathering “others”?

Codependent masochists about covers it. Sado-masterchism, maybe. Sick puppies, & highly contagious, however put.

Todd H.
Todd H.

“U.S. consumers are already stretched to the max, and they will not be able to easily absorb these price increases.”

Yes, and therefore prices of consumer goods will not change much if at all in response to tariffs. Will car buyers pay $5,800 more for a Chevrolet made in Mexico than a Honda made in the U.S.? Not likely.

What will be affected are corporate profits of companies that have outsourced production overseas. With tariffs, they will have an incentive to bring production back to the U.S. The MBA geniuses who run these companies will not look very smart if they don’t.

Discover more from The Burning Platform

Subscribe now to keep reading and get access to the full archive.

Continue reading