The word of the week….both this week and last is….TARIFF.
And as I always do I will look into the history of this country to explain the term of the week…….
The year was 1930 and the Congress enacted the Smoot-Hawley Act.
Okay what the Hell was the Smoot-Hawley Act?
The Smoot-Hawley Act is the Tariff Act of 1930. It increased 900 import tariffs by an average of 40 to 48 percent. Most economists blame it for worsening the Great Depression. That means it also contributed to the start of World War II.
In June 1930, Smoot-Hawley raised already-high U.S. tariffs on foreign agricultural imports. The purpose was to support U.S. farmers who had been ravaged by the Dust Bowl.
Rather than helping, it raised food prices for Americans who were already suffering from the Depression. It also compelled other countries to retaliate with their own tariffs. That forced global trade down by 65 percent.
Smoot-Hawley showed how dangerous trade protectionism is for the global economy. Since then, world leaders advocate free trade agreements that promote increased trade for all participants.
Our president has decided that he likes the idea of imposing tariffs on steel ans aluminum….and no matter which party one aspires to there is few that see any good coming from tariffs (my favorite part of this is to listen to a lying bitch thumping the cheap drum to the positive works that these things will do).
“Trade wars are good,” tweeted U.S. President Donald Trump, “and easy to win.”
And just like that, we’re back in the thick of it: Trump, looking to Make America Great Again, has threatened to use section 232 of the Trade Expansion Act of 1962 to impose tariffs of 25 per cent on steel imports and 10 per cent on aluminum, suggesting it’s a matter of U.S. national security. That would have a heavy impact on Canada, as it is the number-one supplier of both steel and aluminum to the United States. Of course, those proposed levies may just be more bluster for the ongoing NAFTA negotiations; indeed, Trump has said that a “new and fair” NAFTA deal would prompt the U.S. to consider an exemption.
But several things indicate things could be serious, including the Dow’s initial slump in reaction and many Republicans’ frenzied opposition to the decision. More worrying, even, is the fact that it’s entirely consistent with the rhetoric Trump campaigned on—namely, getting blue-collar workers in distressed industries back on the job with protectionist measures.
Some think that it will cost jobs……With economists warning of a potential 146,000 American jobs lost due to the proposed tariffs, Business Insider reveals the US states that could be hit hardest, including Louisiana, Connecticut, and Missouri.
There are some that think that this is just a tactic the president is using to keep the Rust Belt in his sphere of influence and that he will roll everything he has said back……an election ploy for the mid-terms.
We can hope that is his play but some of us do not think he is that clever.
I will do something that my Right wing brethren seldom do…..To be fair…..there is some positive news about the tariff thing…..
US Steel Corp says it will soon restart a blast furnace in Illinois that has been cold for over two years thanks to the 25% tariff on imported steel announced by President Trump last week, Politico reports. US Steel President David Burritt blames “unending waves of unfairly traded steel products” arriving in the US for the poor fortunes of steel workers in Granite City. He believes the planned tariff will turn that around. Restarting the blast furnace at Granite City Works will take up to four months. And while some believe Trump’s tariffs on steel and aluminum will be political winners, many experts are predicting harm to the US economy.
Finally…… Noah Smith at Bloomberg writes the tariffs could be a “self-inflicted wound” for Trump. He says tariffs typically don’t end up improving American industries. Rather they prevent industries from figuring out how to keep pace with global competitors, may lead to their products being seen as shoddy, and might hurt US manufacturers.
Has the GOP become an anti free trade party?
What say you?