Sanctions And Tariffs

Sanctions have been used as economic warfare for centuries…and in reality hurts NO one but the average person and consumer…..then a new president and a new way of economic warfare….Tariffs.

This president has two tools in his economic bag of tricks…..yep you guessed it….sanctions and tariffs.

I have studied 18th century economist Henry George and he has lots to say on tariffs…..

American economist Henry George is best known for his 1879 treatise Progress and Poverty, for which Albert Einstein designated George a “beautiful combination of intellectual keenness, artistic forum, and fervent love of justice” (George 1879, cover). Progress and Poverty became a huge success, and in 1886 George followed up with a far more obscure — but perhaps more significant — work on the nature of free trade as pertaining to the eradication of poverty: Protection or Free Trade: An Examination of the Tariff Question, With Especial Regard to the Interests of Labor (online at the Mises Institute).

The problem identified by Henry George, in Protection or Free Trade, is that of poverty, and more specifically, wages and unemployment. What follows from that is George’s systematic and all-embracing dissertation of the effects that protectionist and free-trade policies have on the wealth of a nation and its individuals. Naturally, he arrives at a conclusion that is decidedly in favor of free trade — as opposed to protective prescriptions — as a surefire solution to the ills of poverty.

https://mises.org/library/henry-george-and-tariff-question

Then there are sanctions…..and I have covered gthe problems with sanctions in previous post…..https://lobotero.com/2019/02/05/sanctions/

But if you prefer…..I have Henry Goerge’s thoughts on trade sanctions……

The American free trader Henry George (1839-1897) argued that trade sanctions against “our enemies” hurt domestic domestic consumers just like any other “protectionist” trade restriction:

Free trade consists simply in letting people buy and sell as they want to buy and sell. It is protection that requires force, for it consists in preventing people from doing what they want to do. Protective tariffs are as much applications of force as are blockading squadrons, and their object is the same—to prevent trade. The difference between the two is that blockading squadrons are a means whereby nations seek to prevent their enemies from trading; protective tariffs are a means whereby nations attempt to prevent their own people from trading. What protection teaches us, is to do to ourselves in time of peace what enemies seek to do to us in time of war.

https://oll.libertyfund.org/quotes/500

Sanctions and tariffs are a lazy person’s answers to any trade problems…..they are NOT solutions at all.

And now my cheese and wine will be much more expensive…….

The Trump administration plans to impose tariffs on $7.5 billion worth of European imports—from gouda cheese to single-malt whiskey to large aircraft—beginning Oct. 18 to retaliate against illegal European Union subsidies for aviation giant Airbus. The latest escalation in the administration’s tariffs will open a new chapter in the trade wars that are heightening fears of a global recession, the AP reports. The administration received a green light for its latest import taxes Wednesday from the World Trade Organization, which ruled that the US could impose the tariffs as retaliation for illegal aid that the 28-country EU gave to Airbus in its competition with its American rival Boeing.

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Trump’s Trade War

There are a wealth of effects of the trade war that dear leader has set his policies on…..like higher prices and Christmas on the way…..but the one number that Americans will pay attention to is the jobs numbers…..

A job count is depressing……….

President Trump says he is “winning big time, against China.” But his trade war is causing measurable damage to the U.S. economy, with the pain likely to worsen.

Forecasting firm Moody’s Analytics estimates that Trump’s trade war with China has already reduced U.S. employment by 300,000 jobs, compared with likely employment levels absent the trade war. That’s a combination of jobs eliminated by firms struggling with tariffs and other elements of the trade war, and jobs that would have been created but haven’t because of reduced economic activity.

The firm’s chief economist, Mark Zandi, told Yahoo Finance that the job toll from the trade war will hit about 450,000 by the end of the year, if there’s no change in policy. By the end of 2020, the trade war will have killed 900,000 jobs, on its current course. The hardest-hit sectors are manufacturing, warehousing, distribution and retail.

Other data back up the Moody’s Analytics numbers. Employers have created 1.3 million jobs so far this year, down from 1.9 million during the same period in 2018. The manufacturing sector has actually contracted, with many producers struggling with higher prices caused by Trump’s tariffs. Business investment is growing by the smallest amount since late 2016.

https://finance.yahoo.com/news/trumps-trade-war-has-killed-300000-jobs-194717808.html

Since this trade war will be a drag on Trump’s re-election hde had to come up with something to change the conversation……and he possibly has found his answer…..the problem is it will a deficit buster…..

President Donald Trump promised to unveil an “inspirational” middle class tax cut next year during a political retreat in Maryland late Thursday, just as the Treasury Department said the nation’s budget deficit topped the $1 trillion mark for only the second time on record. 

Trump told House Republicans in the state’s biggest city, Baltimore, that his “substantial” tax cut plans would be “very, very inspirational … for  middle-income folks, who work so hard,” and that details would be released early next year. Congress, however, would need to approve and pass any suggested tax reductions from the executive branch, setting up a potential election-defining fight with Democratic lawmakers heading into next year’s presidential elections.

The pledge will also add further pressure on the nation’s finances after the Treasury reported a $169 billion shortfall in revenues in August, taking the overall deficit for the 11 months ended in August, the government’s fiscal year, to $1.07 trillion. The last trillion-plus deficit was recorded in the three years that followed the 2008 global financial crisis. 

(thestreet.com)

Where are the deficit hawks?  The Fiscal Conservatives are a bunch of low life cowards.

This is just a promise like all his promise hollow and without merit.

A State Controlled Economy?

Do we still support free markets?

According to the president….HE controls our markets. He has gone so far as to “ORDER” American firms to find an alternate to China’s markets.

ORDERED is the key concept in his statement.

It’s another volatile day on Wall Street, with the Dow down about 500 points at midday. Renewed friction between the US and China is to blame, as President Trump unleashed a series of angry tweets on that subject as well as Fed chief Jerome “Jay” Powell. After Beijing said it would impose tariffs on an additional $75 billion worth of American goods, Trump tweeted that US companies are “hereby ordered” to immediately look for alternatives to China, including relocating operations, reports the Wall Street Journal. “We don’t need China and, frankly, would be far better off without them.” But Beijing was hardly Trump’s only target. After Powell failed to be assertive enough to Trump’s liking in a speech on cutting rates, Trump wrote: “As usual, the Fed did NOTHING!” But his next tweet drew the real attention: “My only question is, who is our bigger enemy, Jay Powell or Chairman Xi?”

Trump’s reference to Xi as an “enemy” strikes CNBC as particularly bad news. It “suggests that the president’s personal relationship with Xi, which Trump has touted as the best route to completing a major trade deal uniting the world’s two largest economies, is at a low point,” writes Tucker Higgins. China’s decision to impose the new tariffs, which go into effect in phases on Sept. 1 and Dec. 15, are retaliation for new tariffs the US is imposing on China, notes the Journal. In another slam against Beijing, Trump wrote that he is ordering “all carriers, including Fed Ex, Amazon, UPS and the Post Office, to SEARCH FOR & REFUSE, all deliveries of Fentanyl from China” because he says the drug is killing Americans

Now if another president who shall remain un-named, had issued this statement the GOP would be having a stroke and going on aimlessly about socialism, communism and stuff like that.

Where are these voices today?

They are still there just aimed at rivals in the political arena…they do not have the inclination to see what their mindless leader is doing to the country and the world.

Let me help those DOLTS in the GOP that may not be aware of what a controlled economy may be…..

The short version……

A centrally planned economy is an economic system in which a single authority, such as a government, makes economic decisions regarding the manufacturing and the distribution of products. Centrally planned economies are the flip-side to market economies, in which such decisions are traditionally made by businesses and consumers, rather than by central authorities.

Is this Trumps “New Economic Policy”?

Do I need to explain this as well?  (it is late and I am tired…use Google)

Not to worry…the “Pussy” president is considering changing his mind on the trade war with China…….

President Donald Trump on Sunday signaled he might be having regrets about his deepening trade conflict with China, telling reporters less than 48 hours after he pledged to raise tariffs on Beijing that he has “second thoughts about everything.”

Asked during a bilateral meeting with Prime Minister Boris Johnson of Britain whether he was second-guessing his posture on China, Trump said: “Yeah, sure why not. Might as well. Might as well.”

The comments marked the president’s first public signal of regret about how he was fighting China through escalating tariffs. They attracted immediate attention across U.S. media because of the unusual nature of Trump’s remarks, leading White House officials to seek clarity from him in between bilateral sit-downs on Sunday morning. The president told aides, “You know what I meant,” according to a person familiar with the conversation.

About five hours later, White House Press Secretary Stephanie Grisham said Trump’s answer to a question about whether he had second thoughts on his approach with China had been “greatly misinterpreted.”

https://www.politico.com/story/2019/08/25/donald-trump-china-trade-war-1474382

Sounds to me like he is scared of the markets and his re-election….so he pussied out.

“Lego Ergo Scribo”

What About China?

OMG!

The news is back and forth….China good….China a bad player….China this…..China That…….

We have a monarch that demonizes China when it suits him….and pretends he likes them when he needs something.

But cut through the BS….is China an enemy?

China has one-fifth of the planet’s population; the world’s second largest economy; a small but significant nuclear arsenal for deterrence; and an increasingly repressive government which combines elements of market economics with single-party totalitarianism, incredibly invasive surveillancemass internment camps; and a newly minted “president for life,” Xi Jinping. Should it also be the recipient of Washington’s antagonism?

https://thehill.com/opinion/international/457098-china-is-a-rival-not-an-enemy

A group of China experts here in the US has written a letter to the White House…..

An open letter from 100 well-known China experts in America, critical of Washington’s adversarial stance towards Beijing, has highlighted – and fuelled – the ongoing debate in the United States over how to deal with China.

The public pushback from moderates was prompted by concern over worsening US-China relations, amid a hardening anti-China line from Trump administration officials and a festering trade war that has spilled over to competition in technology and other arenas.

Their letter was addressed to President Donald Trump and members of Congress, and published in The Washington Post on Wednesday. Headlined “China is not an enemy”, it outlined the authors’ problems with the current US approach to China and laid out their tenets for a better foreign policy.

https://www.straitstimes.com/world/united-states/open-letter-to-trump-china-is-not-an-enemy

Think about it…have you heard from the MSM on this subject?  Probably not.

An article from 5 years ago about China and its role……

The rise of China as America’s chief rival on the international stage has long been a staple of our foreign policy pundits’ alleged wisdom. The Chinese, simply by virtue of their enormous population, have been deemed the inheritors of the earth. China, we are told, has been in the process of overtaking us in terms of virtually every metric imaginable: demographic, economic, and, most important of all, military. There’s just one problem with this Sinocentric view of the future: it’s based on nonsensical assumptions. And the central wrongheaded assumption – that China is a stable unitary country and will always remain so – is being disproved (once again) by the events now unfolding in Hong Kong.

China Is a Paper Tiger

This whole China thing is a mash up of policies that no one understands….especially analysts that must to have the national security at heart.

Time to bring Foreign Policy out of the black hole that Trump and Gang have put it into.

“Lego Ergo Scribo”

The Economy, Stupid!

The markets have had wild swings for about a year now….but with that the profits roll on for the corporations…..the president’s lack of economic knowledge and the wild lies of something good is just making things worse.

And this past week it has come to a head (as they say)…..it happened in the bond markets……

An economic alarm bell has sounded in the US, sending warnings of a possible recession ahead—and sending the Dow plunging 800 points by the end of the day. Yields on 2-year and 10-year Treasury notes inverted early Wednesday, a market phenomenon that shows investors want more in return for short-term government bonds than for long-term bonds. It’s an indication that investors have lost faith in the soundness of the US economy, the AP reports. What appeared to be a slight thaw in trade relations between the US and China that had sent markets sharply higher Tuesday was quickly forgotten, with the Dow opening down 400 points. By 12:30pm ET it was down nearly 650 points; a half-hour later it had plunged 737 points, or 2.6%, reports CNBC. By end of day it was down 800, the S&P 500 was down 86, and the Nasdaq was down 242, per Marketwatch.

CNBC notes that bank stocks like Bank of America and Citigroup have been the big losers today, down 5% and 5.2% respectively, as “it gets tougher for [them] to make a profit lending money in such an environment.” The yield on the benchmark 10-year Treasury note hit 1.622%, falling below the yield of a 2-year, which was 1.634%. The last inversion of this part of the yield curve was in December 2005, two years before a recession brought on by the financial crisis hit. An inversion like the one taking place Wednesday has preceded the last nine recessions dating back to 1955. When a recession might hit, if it does, is a little hazier. Months or even years have passed after an inversion takes place, and before economists can connect the two. Marketwatch notes Wednesday was the Dow’s worst day this year.

Here comes the “R” word…. a “recession”…..some are running worried….

Then there are the multiple lies about China and tariffs….remember when he said China would pay for the tariffs not the American people?  That was the same lie as Mexico would pay for that damn silly border wall.  Don’t forget the lie about all the billions flowing into the coffers of the nation…that was a lie as well…..

If China was gonna to pay and the pain would all be on someone else then why did Trump decide to postpone tariffs until mid-December?

U.S. President Donald Trump on Tuesday backed off his Sept. 1 deadline for 10% tariffs on remaining Chinese imports, delaying duties on cellphones, laptops and other consumer goods, in the hopes of blunting their impact on U.S. holiday sales.

https://uk.reuters.com/article/uk-usa-trade-china-tariff/trump-backs-off-china-tariff-plan-with-delays-for-cellphones-laptops-idUKKCN1V31CR

Would “impact US holiday sales”…..that should tell you everything you need to know about these pseudo-economic solutions….even if you are not a genius like our Supreme Leader Trump.

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“Lego Ergo Scribo”

 

Venezuela–Again

OMG!

Might know that after I wrote a post about the lack of concern by the media over Venezuela…..https://lobotero.com/2019/08/05/dont-cry-venezuela-2/  and then His Majesty needed a diversion so he chose Venezuela for that diversion.

President Trump signed an executive order late Monday imposing a full economic embargo against Venezuela, freezing all government assets in the US and forbidding all transactions of any Venezuelan officials.

This is the first major expansion of sanctions against a western hemisphere nation by the US in over 30 years, and is intended to put Venezuela into the same level of economic isolation as similarly restricted Cuba, Iran, North Korea, and Syria.

The order cites human rights abuses, and the fact that President Maduro is still in power in Venezuela, even though the US recognized opposition leader Guaido as the rightful ruler of the country.

This is the latest US effort to try to impose regime change in Venezuela, after a failed military coup earlier this year. It’s not clear how broadly the US intends to enforce the sanctions, for example if they intend to use military force to prohibit naval trade from the Venezuelan coast

(antiwar.com)

Okay I thought we already had enacted massive economic sanctions against Venezuela…..wait this is an embargo…surely that is a different thingy altogether, yeah?

Both sanctions and embargoes mean the prohibition or restriction of an activity. Particularly, an embargo is commonly used when the restriction is a trade-related. Sanctions, on the other hand, are used for all other disciples of prohibitions.

Basically it is the same thing….sounds like an attempt to get the media to look the other way…and is a waste of time…..diplomacy will get more accomplished than Neocon bullshit.

But Wait!

We have a Supreme Leader that has NO idea what is meant by diplomacy….because it will not translate to a TV Reality Show.

Not to worry it will be something new next week.

“Lego Ergo Scribo”

Do Laws Apply In Space?

I have watched His Majesty Trump turn everything he touches into a steam pile of manure…..and he has his watery eyes turned to Space.

We Americans pride ourselves to be a nation of laws and we abide by those laws and it is what keeps our nation great among nations….well that was true until the election of 2016.

The new field of law will be that of the issues and situations in space.

I have been writing about space for awhile now (I seem to be the only one that cares enough to post) with the push for a new space force and the mining possibilities in space will give an usual chance for clarity for right now there is very little of that.

The Law and Order (the reality not some idea for a new TV show) is what is interesting and I wrote about it on several occasions…..https://lobotero.com/2019/04/12/space-law/ and again……

The first thing that may violate laws and treaties……

The Pentagon’s Defense Innovation Unit wants options for an unmanned orbital outpost to support space experiments and operations — a logistics hub that might even grow, DIU’s solicitation suggests, to a larger manned space station.

Pentagon Eyes Military Space Station

Then I read another space story that again made me think of existing laws and treaties……

16 Psyche is composed of iron, nickel, gold and platinum, the only asteroid we know of that is 95% or more metal. Scientists believe that the asteroid had a rocky surface at one time, but lost it due to several violent collisions billions of years ago.

The potato-shaped asteroid is estimated to have a value of $10,000 quadrillion. That’s enough staggering wealth to hypothetically make every single on Earth a billionaire.

A 2018 report said the value of 16 Psyche was $15 quintillion, while another source said the asteroid could be worth an unbelievable $700 quintillion, enough to give every human being on Earth about $92 billion each. What is NASA waiting for?

NASA Mission To Explore Solid Metal Asteroid That Is So Valuable It Could Make Everyone On Earth A Billionaire

Now to make clear the US among others signed a treaty called the “Principles and Actions Governing the Exploration and Use of Outer Space”…..read it for yourself (Hahaha like anyone would take the time…I am so cute thinking they would)……https://2009-2017.state.gov/t/isn/5181.htm

Or the UN treaty……https://www.ifrc.org/docs/idrl/I515EN.pdf

Let us not forget what Obama did as president……

On November 25, 2015, President Obama signed into law the US Commercial Space Launch Competitiveness Act (H.R. 2262). This Act encompasses four titles: I. Spurring Private Aerospace Competitiveness and Entrepreneurship (acronym: SPACE), II. Commercial Remote Sensing, III. Office of Space Commerce and IV. Space Resource Exploration and Utilization.

https://www.jurist.org/commentary/2015/11/frans-vonderdunk-space-launch/

Or more news……https://www.space.com/33440-space-law.html

Read the bill that made the Act possible……https://www.govinfo.gov/content/pkg/BILLS-114hr2262enr/pdf/BILLS-114hr2262enr.pdf

Since we live in this instant gratification and have lost the ability to read I have included some videos which simpler minds will appreciate (if they get this far into this post)…….

Plus a little more…..

The Market forces will determine the need and the supply……

There is so much more to this situation than anyone wants to admit…..exploitative forces will be at work if they already are not.,,,,someone needs to keep an eye on the legality…..of the Space Force of the commercial ideas for space and the arming of space junk.

That someone might as well be me!

“Lego Ergo Scribo”