The pseudonym "Philo Vaihinger" has been abandoned. All posts have been and are written by me, Joseph Auclair.

Friday, March 2, 2018

This is why we call him "Bozo"

Trump defends tariff plan, says ‘trade wars are good’ as markets drop

The man's head is stuffed with sawdust.

The stock market is losing big in the face of this threat to the economy.

President Donald Trump on Friday defended his controversial plan to slap huge tariffs on imported steel and aluminum amid intense GOP criticism and a growing global backlash, saying "trade wars are good, and easy to win" as international markets braced for more losses.

“When a country (USA) is losing many billions of dollars on trade with virtually every country it does business with, trade wars are good, and easy to win,” Trump tweeted early Friday. 

“Example, when we are down $100 billion with a certain country and they get cute, don’t trade anymore — we win big. It’s easy!”

A short time later, he returned to add, “We must protect our country and our workers.”

“Our steel industry is in bad shape. If you don’t have steel, you don’t have a country!” he said.

Almost fifty years too late to save the Mon Valley, my friend.

Trump’s morning tweets were in reference to his announcement Thursday that the U.S. would levy tariffs of 25 percent on imported steel and 10 percent on imported aluminum — a move that prompted fierce criticism from Republicans in Congress and dire warnings of retaliation from the country's trading partners, as well as led markets to tank.

Key players on Capitol Hill, including House Speaker Paul Ryan, R-Wis., and Sen. Orrin Hatch, R-Utah, the Senate Finance Committee chairman, were not given any heads up about Trump’s tariff announcement, and many broke ranks with Trump in an unprecedented way, with one after another coming forward during the day to caution about the dangers of tariffs and plead with Trump to hold off on any action.

Sen. Ben Sasse, R-Neb., slammed Trump's concept of a "good" trade war in a statement Friday, and said fighting one would only lead to "so much losing."

"Trade wars are never won. Trade wars are lost by both sides. Kooky 18th century protectionism will jack up prices on American families — and will prompt retaliation from other countries," Sasse said. 

"Make no mistake: If the president goes through with this, it will kill American jobs — that's what every trade war ultimately does. So much losing."

Who gave him authority to do this?

The Constitution gives the power to regular foreign trade to the Congress, not the President.

This is the president who claims to have scuttled DACA because President Obama did not have the constitutional authority to create the program in the first place, and Congress had repeatedly refused to do it.

The Times on the Tariffs

The big winners are the United States steel and aluminum industries, which have lobbied for years for this kind of aggressive government action.

The most immediate losers are the industries that rely on steel and aluminum as an input and will face higher prices. 

That includes some of the nation’s biggest industries: the automobile sector; aerospace; heavy equipment; and construction.

. . . .

The industries that use steel and aluminum are considerably larger as a share of the United States economy than are steel and aluminum producers. 

By one estimate, from Lydia Cox of Harvard and Kadee Russ of the University of California, Davis, steel-using industries employ 80 times as many people as steel-producing industries.

. . . .

In most retrospective analyses, the 2002 Bush administration steel tariffs have been judged to be costly relative to the jobs that were saved, but they were hardly the cause of some economic disaster.

This action may create some jobs in domestic metals-producing industries, cost some jobs in fields where steel and aluminum are inputs, and push consumer prices a bit higher.

. . . .

Affected countries may well retaliate by ordering tariffs on American goods, and they could carefully target goods to cause economic or political pain. 

American exporters — whether they sell passenger airplanes or soybeans — should be nervous about the next shoe to fall. 

There are few winners in an all-out trade war like one that enveloped the world economy in the 1930s.

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