GeorgeH wrote:
Thank you, Blurry. With a few exceptions I've found you to be reasonable, and your opinions worthy of consideration. Still....why is Mr Trump so exercised over NAFTA given the disparity between our economy and those of Mexico and Canada? Could it be that NAFTA was engineered by Mr Clinton?
No, I seriously doubt that is the reason, sometime back we decided that we could allow the rest of the world to build our products and we would simply sell them. Somehow those in the know seemed to think that the financial sector could help with the trade balance. So now what do we have? Trade deficits year in and year out, instead of building our own country's wealth we are building the wealth of others. We are seeing employment problems in this country while at the same time are loosing sk**led labor because there are no longer markets for it here. We have not done well and I think that Trump wants to stop the bleeding. The democrat side of the Carrier deal that they use to criticize Trump only goes to highlight that fact, even after we gave Carrier all kinds of tax considerations and incentives according to articles that Dirt Posted most of those jobs left anyway, something must be a little uneven in our arrangement. Then consider all the auto manufacturing down there and the fact that foreign manufacturers, German, Japanese, and others are making investment there instead of here.
Hey, I love the economics of Classical Liberalism, but what that school of thought does not consider is that free trade today even if we could break down all the trade barriers is not exactly free. Labor markets in some countries is hardly different than s***ery, in fact I have heard it said more than once that s***ery is alive and well in the 21st century and being used to make some of the products that we consume. So how are we to compete against that? Then we the imbalance of tariffs, many countries including China and Mexico are considered to be developing countries and because of that we have tolerated tariffs on our goods going in while their goods coming into this country receive much more favorable tax considerations.
I think that Trump is right in what he is trying to do but I do agree that it is a risky business, but in the end I can't help but think that the US comes out on top because we are by far the largest economy in the world and our consumption of imported goods probably far exceeds most any other economy. China can not afford to lose this market, nor can Mexico or Canada.
Sectors and individual businesses will be hurt, we have already seen concern in the farming industry when the Chinese proposed a 175% tariff on a crop used to feed livestock, we have heard from US manufacturers that his tariffs on steel and aluminum will hurt their industries possibly making them non competitive in their markets. There will undoubtable be pain throughout the process but is that not part of the problem? Have we not been so risk reverse that we have never fully demanded a fair deal for our economy and its workers? This country has enjoyed the highest standard of living in the world and for the most part still does, there are a few small countries that out perform us but they are hardly larger than a large US city so they really don't count when considering large complex economies.
There are a lot of things that need to be addressed that our politicians will not touch, trade is one of them and entitlements is another. You are a smart man George, study our budgets and what drives the deficits. We are going to have to address Social Security, Medicare, and entitlements, mathematically there is no way to avoid it. I know that democrats don't believe in the tax structure that was just passed by Trump, but I truly hope you are wrong because given our governments course and its thirst for more and more spending and taxes I just could not see a reason for businesses to invest in the US. Prior to this tax bill what did we have to offer, highest corporate taxes, high regulation costs, high labor costs.... Why would businesses, even American businesses that have a multinational presence invest in America when they could go overseas and be much more profitable?
Those are my thoughts, time may prove me wrong in my hopes for the tax cuts and time will tell, but honestly I still would not consider the tax cuts permanent as the dems say that the first thing they will do when they regain control of congress is repeal the tax bill, if I were an investor looking at the US business environment this would cause me concern.