Tag: International Trade

A Trade Update

We all have heard or read or watched the game being played with international trade…….BAM!  Trump has levied tariffs on international steel ans aluminum….and then the president goes to the G7 and blows up everything…..

First floated the idea of scrapping all tariffs……

President Trump reportedly asked world leaders at the Group of Seven Summit on Friday to consider “no tariffs” at all amid growing tensions over the administration’s trade moves.

Politico, citing officials who listened and took notes of the discussions, reported that Trump told assembled world leaders that “we should at least consider no tariffs, no barriers — scrapping all of it.”

(thehill.com)

Did I miss something?

After saying that nugget……Trump threatens to end ALL trade……

Leaving the G7 summit on Saturday, President Trump said that the U.S. might end all trade with America’s closest allies if those countries don’t submit to his demands over reduced trade barriers. Trump also confirmed that he had told the leaders of Britain, France, Germany, Japan, Canada, and Italy that there should be no tariffs between them and the U.S. of any kind. Whether Trump’s characteristically hyperbolic threat, or overarching proposal, will be taken seriously is another matter.

Referring to what he called “ridiculous and unfair” tariffs on U.S. imports, Trump said, “It’s going to stop — or we’ll stop trading with them. And that’s a very profitable answer, if we have to do it.”

http://nymag.com/daily/intelligencer/2018/06/trump-threatens-to-end-all-trade-with-allies.html

Okay what part of any of that sounds like something that would be taught at the Wharton school?

Why did he waste time pissing everybody off?

BTW just a reminder where the trade goes here in the US….

Then there was some good news (at least for me)….

Before I begin let me say…..my more Right leaning brethren have accused me of hating our president, Donald J. Trump.  They are mistaken I may dislike the man but I hate very few people.

With that said there are a few policies that Trump espoused that I could agree with….some of his campaign thoughts on war and foreign policy and a few domestic things…the problem is that when he became president he back peddled on the ones I liked….that fed my dislike.

Everyone knows about the trade war that Trump is about to start with the rest of the world, right?  Well he has made a statement that I fully agree with….he has said that he wants to ban German luxury cars.

President Donald Trump is hoping to effectively ban sales of Mercedes-Benz, Audi, and other German cars, according to reports from a German magazine.

A report in WirtschaftsWoche cites unnamed diplomatic sources who say Trump told French president Emmanuel Macron he would maintain his trade policy “until no Mercedes models rolled on Fifth Avenue in New York.” The trade policy would seemingly affect any German automaker, though, putting sales of Porsche and Volkswagen (and its Audi luxury division) at risk as well as Daimler.

Trump has long held a hardline position toward German automakers. Last January, he underscored this in comments that appeared in the German magazine Bild.

“When you walk down Fifth Avenue, everybody has a Mercedes-Benz parked in front of his house,” Trump said, according to a Wall Street Journal translation of the comments. “You were very unfair to the U.S.A. It isn’t mutual. How many Chevrolets do you see in Germany? Not many, maybe none, you don’t see anything at all over there. It’s a one-way street.”

(yahoo news)

This will not sit well with the pretentious twats that own one of these cars….I say let these self-centered slugs buy American.

Since I am an Italian sports car enthusiast, Ferrari, Maserati, Alfas I cannot disagree or fault Trump for his vendetta against the Germans.

Let me leave you with a small joke…..

What is the difference between a porcupine and a BMW?

A porcupine has all the PRICKS on the outside.

(rim shot)

Not to worry if you are wealthy enough for one of their pieces of scrap metal then you will find a way around the ban…..they always do.  Their money will buy lots of privilege.

More bad news about these new tariffs….economist say that the dollars saved by people because of the tax cuts will be taken away because of increase in prices…….

Your trade moment is done….I return you to your regular reading habits….

Be well, be safe…..chuq

War Has Begun (Trade That Is)

First, Trump aimed his trade policies at China and their steel industry….there was some back and forth and a bit of a back step and then it raised its head again…..

The delay is over. The Trump administration is announcing tariffs on steel and aluminum imports from the European Union, Canada, and Mexico, in a move sure to raise worries of a trade war. Commerce Secretary Wilbur Ross says there will be a 25% tariff on imported steel and a 10% tariff on imported aluminum, reports the AP. President Trump announced the tariffs in March but the US granted exemptions to the EU, Canada, Mexico, and other US allies. Ross says talks with Canada and Mexico over the North American Free Trade Agreement are “taking longer than we had hoped.” He says negotiations with Europe have “made some progress” but not enough to merit an exemption.

Ahead of Thursday’s move, German Chancellor Angela Merkel said the 28-nation bloc would respond “in an intelligent, decisive, and joint way” after making plain to Washington its view that the tariffs are incompatible with World Trade Organization rules. German Foreign Minister Heiko Maas said “protectionism and isolation against free trade mustn’t regain the upper hand,” while French Finance Minister Bruno Le Maire called the tariffs “unjustified, unjustifiable, and dangerous,” noting a trade war would hurt growth everywhere. Also in advance of Ross’ announcement, Global News reported Canada had drawn up a list of possible US targets to hit in response

Let’s begin…..Mexico has answered the tariffs……

The government of Mexico announced on Thursday it would implement new duties on various U.S. products in response to President Trump‘s decision to levy steel and aluminum tariffs on the country.

“Mexico reiterates its position against protectionist measures that affect and distort international commerce in goods,” the government said in a statement.

“In response to the tariffs imposed by the United States, Mexico will impose equivalent measures to various products like flat steels (hot and cold foil, including coated and various tubes), lamps, legs and shoulders of pork, sausages and food preparations, apples, grapes, blueberries, various cheeses, among others, up to an amount comparable to the level of affectation.”

(thehill.com)

Some analysts say that this move will cost Americans jobs……as many as 2 million possible…..plus the cost of anything in an aluminum package will be more expensive……some food items will go up….and lumber….making new homes more expensive….just to mention a few of the sectors that could be effected.

The War Of Words

It seems they is all we have going on in this country these days…all the he said, he said…..the silly back and forth while this country slides into yet another abyss…..the trade war is the newest “art of the deal”…….the bluster is good but is any of it true?

President Trump on Monday made the case that his White House is righting years of wrong in regard to China. Beijing “has agreed to buy massive amounts of ADDITIONAL Farm/Agricultural Products – would be one of the best things to happen to our farmers in many years!” he wrote. “On China, Barriers and Tariffs to come down for first time,” went another. And a third took aim at Democrats. “I ask Senator Chuck Schumer, why didn’t President Obama & the Democrats do something about Trade with China, including Theft of Intellectual Property etc.? They did NOTHING! With that being said, Chuck & I have long agreed on this issue! Fair Trade, plus, with China will happen!” The tweets follow days of negotiations between the two nations, though even some of Trump’s supporters are worried that China is getting the upper hand. Details:

  • Dueling statements: Treasury chief Steven Mnuchin said Sunday that the US was “putting the trade war on hold” and ditching the idea of tariffs while talks continue. However, Trade Representative Robert Lighthizer made a point to say that tariffs were still an important tool to “protect our technology.” The Wall Street Journal sees these as “markedly different positions,” adding that the statements punctuate days of negotiations “with a question mark.”
  • China winning? An analysis by Heather Long at the Washington Postasserts that China is winning the trade fight, at least so far. The White House, for example, has been demanding that China reduce the United States’ trade deficit with Beijing by at least $200 billion, but no such specifics were evident in a “noticeably vague” joint statement issued by the nations over the weekend. Also, China may have agreed to buy more US energy and farm products, “but it was almost certain that the Chinese were going to buy more of that stuff anyway.”
  • Criticism: Business Insider rounds up criticism of the weekend developments from Trump allies including Lou Dobbs of Fox Business (“US must export like a superpower not an agrarian developing nation half our size!” he wrote) and former steel industry CEO Dan DiMicco (“Did #President just blink?” he wrote. “China & friends appear 2 be carrying the day.”) Meanwhile, Marco Rubio states flatly that China “is winning the negotiations.”
  • What’s next: With the trade war “on hold,” CNNMoney looks at the big questions still to be answered in ongoing talks, including whether Beijing will seriously address US allegations of technology theft.
  • Biggest threat? A post at Axios argues that China is “thinking long term” with a global strategy, unlike the US. “China is pouring time, money, infrastructure and trade into every continent, after promising to fill the global void created by Trump’s America First,” writes Jim VandeHei, who also faults Congress for having short-term vision. Xi Jinping is positioning China to dominate most of the world’s important industries in the decade to come.

So the “art of the deal” is put on hold while the words continue to fly……is this something learned in the Wharton School?

TPP Will Not Go Quietly

2016 the promise was to pull out of the TPP because it was NO GOOD for the country and NAFTA would be re-negotiated….promises by then candidate Donny Trump…..

So far NAFTA remains in its original form and the US has pulled out of the TPP in 2017…..but wait there is more news on the TPP front…….

President Donald Trump has asked trade officials to explore the possibility of the United States rejoining negotiations on the Pacific Rim agreement after he pulled out last year as part of his “America first” agenda, the AP reports. Farm-state lawmakers said Thursday after a White House meeting with Trump that he had given that assignment to his trade representative, Robert Lighthizer, and his new chief economic adviser, Larry Kudlow. The Trans-Pacific Partnership would open more overseas markets for American farmers. “I’m sure there are lots of particulars that they’d want to negotiate, but the president multiple times reaffirmed in general to all of us and looked right at Larry Kudlow and said, ‘Larry, go get it done,'” said Sen. Ben Sasse. Eleven countries signed the agreement last month.

Trump’s rejection of the deal has rattled allies and raised questions at home about whether protectionism will impede US economic growth. Kansas Sen. Pat Roberts, the chairman of the Senate Agriculture, Nutrition and Forestry Committee, said he was “very impressed” that Trump had assigned Kudlow and Lighthizer “the task to see if we couldn’t take another look at TPP. And that certainly would be good news all throughout farm country.” The discussions came during a meeting in which Trump told farm-state governors and lawmakers that he was pressing China to treat the American agriculture industry fairly. Midwest farmers fear becoming caught up in a trade war as Beijing threatens to impose tariffs on soybeans and other US crops, a big blow to Midwestern farmers, many of whom are strong Trump supporters.

Is the possibility of re-joining TPP a by-product of the new tariffs that the president thinks will make America Great Again?

Closing Thought–05Feb18

Does everyone remember the promises of the campaign?  Of course not……if they did then Trump would be less popular than he is….but that aside…..does the reader remember all the promises of the return of American business from overseas?

The promise was that he, Trump, would make it such a positive business environment that those American companies would come streaming back…..

Harley-Davidson has crapped on that promise……

The iconic American motorcycle maker was part of President Donald Trump’s focus on U.S. manufacturing in the early days of his administration. Executives visited the White House in February to meet with Trump, who thanked Harley-Davidson “for building things in America.” But even Harley-Davidson had a manufacturing footprint overseas, and the Milwaukee-based company says the facility in Thailand will improve its ability to serve markets where demand is on the rise.

Harley-Davidson said the move will not impact its U.S. factories.

http://www.foxbusiness.com/markets/2017/05/23/harley-davidson-building-factory-in-thailand.amp.html

“Will not impact American factories”…..then why is the factory in Kansas City being closed?

Just asking?

Have a good evening…..peace out my friends…..chuq

China Is Winning The Trade War

While the US is fighting its numerous wars the trade war is being won by China and its Silk Road Project.  In the old days the Silk Road was a trade route from Asia to Europe back in the the 1400s and China is silently renewing this trade route…..

The US needs to counter this trend by China or the trade war will be won by our Asian opponent…..the US is trying to sign on to the deal but will it be a good deal or a bad one?

While Washington is seeking a pause in the rapid growth of its international trade, the rest of the world is moving full speed ahead. There is no better example than the fast developing New Silk Road, China’s vast project to facilitate its trade with Europe and connect Central Asia to the world economy.  At a recent conference in Washington hosted by the Eurasia Center, speakers reported all sorts of information about the project.

Already since 2013 freight trains go from China’s mid-pacific coast to Poland in 12 days, less than half the time for cargo ships to Western Europe and much faster for inland Chinese factories such as major electronics ones, such as the American Hewlett Packard in Chongqing. It has opened up a new central Asian market for Polish agricultural exports. Even Italian wines and German cars are now going by rail to Asia. Train traffic has more than doubled during the last year to some 45-50 trains per month. Traffic will take even fewer days if the Chinese region follows through with eventual plans for high-speed rail connections. Businessweek’s China-sponsored “Focus Report” states that 32 Chinese cities now have 52 China-Europe rail lines connecting to 12 European countries.

http://www.theamericanconservative.com/articles/silk-road-is-soft-power-for-expanding-china/

Did Fearless Leader take this up with the Chinese when he was in China?  My thought is nope….he was too busy trying a Big Mac to worry about trade….more on this trip of trips…..

On Tuesday, President Donald Trump returned to Washington after a marathon tour of Asia. His trip spanned two multilateral summits, five countries, and set an important record: It was the longest Asia trip undertaken by any U.S. president in 25 years.

Trump’s trip was a remarkable opportunity to restore to Asia the rare leader-level time and attention so often trained on the Middle East and Europe. And yet, although time was for once abundant, strategy was absent, and the trip was largely a missed opportunity.

A review of Trump’s time in Asia reveals three key points.

https://warontherocks.com/2017/11/trumps-indo-pacific-dream-stumbles-china-alone-wont-fill-void/

I am still looking for the “good” part of this trip……lots of words and a few Tweets but reality does not bear out the words from the mouth of Fearless Leader…..

President Trump has just completed a 12-day tour of Asia, including stops in Japan, China, Korea, and the Philippines, and in Vietnam to attend the APEC Leaders meeting.

After pulling out of the Trans-Pacific Partnership (TPP) during his first week in office and threatening to leave the North American Free Trade Agreement (NAFTA) and the World Trade Organization (WTO), his Asia trip was an opportunity to present an alternative vision of U.S. economic engagement in Asia. Many hoped it would be sufficiently robust and strategically orientated to put to rest global concerns about where Washington stands on trade and globalization more broadly.

Unfortunately, this is not what happened.

https://www.brookings.edu/blog/order-from-chaos/2017/11/15/the-fallout-from-trumps-asia-tour-on-trade

All in all ……a complete waste of time when the best we got was some silly photo ops.

Weaponization Of Trade

The US is the most powerful country in the world when it comes to weapons and military might.

Force is used more often than any other technique to move the country’s agenda forward…..but there is a sector that the US uses sparingly….Trade.

China on the other hand has learned to use trade as a weapon…..

China denies mixing business with politics, yet it has long used trade to punish countries that refuse to toe its line. China’s recent heavy-handed economic sanctioning of South Korea, in response to that country’s decision to deploy the Terminal High Altitude Area Defense (THAAD) anti-missile system, was just the latest example of the Chinese authorities’ use of trade as a political weapon.

China’s government has encouraged and then exploited states’ economic reliance on it to compel their support for its foreign-policy objectives. Its economic punishments range from restricting imports or informally boycotting goods from a targeted country to halting strategic exports (such as rare-earth minerals) and encouraging domestic protests against specific foreign businesses. Other tools include suspending tourist travel and blocking fishing access. All are used carefully to avoid disruption that could harm China’s own business interests.

Source: China’s Weaponization of Trade by Brahma Chellaney – Project Syndicate

Maybe the US should take a page from the Chinese playbook…..learn to use our trade as a weapon.

This could go a long way of making the promise of more jobs come true….plus could minimize the use of military force….an aspect that is becoming almost too expensive to continue.

Don’t Bury TPP Just Yet

Happy Valentine’s Day everyone!

Trump was vocal on his opposition to NAFTA and TPP….so vocal that he probably got him some votes from labor…..he promised to re-negotiate NAFTA and end the TPP….(and the peasants danced)…..

Most Americans are all in favor of free trade…..but are they?

Free trade is the economic policy of not discriminating against imports from and exports to foreign jurisdictions. Buyers and sellers from separate economies may voluntarily trade without the domestic government applying tariffs, quotas, subsidies or prohibitions on their goods and services. Free trade is the opposite of trade protectionism or economic isolationism.

Politically, a free trade policy may just be the absence of any other trade policies; the government need not positively do anything to promote free trade. This is one reason it is sometimes referred to as “laissez-faire trade” or “trade liberalization.” Governments with free trade agreements (FTAs) do not necessarily abandon all control of taxation of imports and exports. In modern international trade, very few so-called FTAs actually fit the textbook definition of free trade.

Now that we have talked about “free trade”….shall we talk about the future of TPP?
There was a sigh of relief when Trump was elected….for now the TPP is dead and soon buried.
Think again!

One can hear the cry ringing through the boardrooms of capital: “Free trade is dead! Long live free trade!”

Think the ideas behind the Trans-Pacific Partnership or the so-called “free trade” regime are buried? Sadly, no. Definitely, no. Some of the countries involved in negotiating the TPP seeking to find ways to resurrect it in some new form — but that isn’t the most distressing news. What’s worse is the TPP remains alive in a new form with even worse rules. Meet the Trade In Services Agreement, even more secret than the Trans-Pacific Partnership. And more dangerous.

Source: TPP is Not Dead: It’s Now Called the Trade In Services Agreement

Take a closer look at TiSA…..

Here is where things gets scary. Team TiSA – a consortium of multinational financial, logistics, and big data corporations – are looking to set severe limits on how governments can regulate economies domestically while providing strict investor rights provisions. Deborah James outlined ten aspects of TiSA that have been accepted by all parties or are under negotiations that could have significant consequences:

  1. Companies are expanding the category of “services” in order to make it all-encompassing so that the agreement could apply as broadly within the economy as possible.
  2. Offshoring and outsourcing of jobs and downward pressure on wages could greatly accelerate as TiSA would lock in labor, tax, and regulatory arbitrage.
  3. Not only would TiSA promote offshoring of jobs, but it would also greatly expand domestic “inshoring.” Foreign contractors (say from Japan) would be able to bring in workers (say from Philippines) to conduct work inside a consumer country (say the United States) on terms well below the minimum local pay and standards.
  4. The TiSA does not include a labor chapter, and in fact the draft texts only mention labor rights once.
  5. Preventing governments at the national, state, and even municipal levels from supporting local business and local employment.
  6. The principle of “technological neutrality which TiSA negotiators take as a given would have immeasurable job impacts particularly with regard to the “gig” economy. So if a country opened its market to passenger transport services, it could not apply new and different rules to Uber than to traditional taxicabs.
  7. Job loss as a result of privatization would increase as publicly owned utilities would have to compete under the same rules as private companies, reducing the benefits of public ownership, resulting in the elimination of jobs that inevitably follows privatization.
  8. The financial services text of the TiSA is the closest thing imaginable to a guarantee of another job-killing financial crisis. If the draft texts were accepted, the TiSA would constrain governments from implementing most of the regulations that are recognized, both domestically and internationally, as essential to prevent another global financial crisis.
  9. Workers would have to shoulder even more of the tax burden as corporate tax evasions would accelerate.
  10. The TiSA could potentially be used as the basis of a foreign company’s claim against the United States

Where are all the yells and cheers now?  I am waiting!

Is The TPP Finally Dead?

From the beginning I was opposed to this TPP that Obama and so many others championed….I recall what damage Clinton’s NAFTA did to the American economy….

There were a few issues in the Trump agenda that I could embrace….but I liked his rhetoric on international interventionism and especially his rhetoric on trade….both NAFTA and TPP……

Mercifully it appears that the TPP is finally dead…..

In spite of the hopes of many elite types for a last-minute resurrection, it appears that the Trans-Pacific Partnership (TPP) is finally dead.  This is good news, but it took a long time to kill the deal, and the country is likely to pay a huge price for the execution.

The basic point that everyone should know by now is that the TPP had little to do with trade. The United States already had trade deals with six of the 11 other countries in the pact. The trade barriers with the other five countries were already very low in most cases, so there was little room left for further trade liberalization in the TPP.

Instead, the main purpose of the TPP was to lock in place a business-friendly structure of regulation. The deal was negotiated by a series of working groups that were dominated by representatives of major corporations. The regulatory structure was to be enforced by investor-state dispute settlement tribunals. This is an extrajudicial system that would be able to override US laws with secret rulings that were not bound by precedent or subject to appeal.

Source: The Slow, Painful Death of the TPP

We will have to wait and see if Trump will be true to his word……my optimism is at a low ebb right now.

‘Free Trade’ vs. Actual Free Trade

This election has brought the subject of “free trade” to the forefront….both Sanders and Trump are talking more and more about this situation….

Personally, I am sick of the so-called “free trade agreements” that benefit NO one but those that already have most of the cash…..try to sell them anyway you choose but few have benefited from such agreements.

Sorry, to say that I must put a little historical perspective in this press….it will help those that want to understand to do so a little easier….

The unlikely rise of Bernie Sanders and Donald Trump has focused public attention on an issue that hasn’t gotten much attention since the Civil War era – international trade. One of the biggest controversies in nineteenth century American politics was tariffs – with Big Business manufacturers for them, and farmers and producers of other commodities […]

Source: ‘Free Trade’ vs. Actual Free Trade – Antiwar.com Original by — Antiwar.com

If free trade is one of your issues then get all the facts before you pull the wrong lever……