Calling it "Politically Motivated"

[Markk]

Markk, I get all that. Pipefitters work on pipes. Steam travels through pipes. Etc.

That’s fine and all, but I don’t think that tariffs are going to spawn a need for a significantly greater number of pipefitters than already exist.

A lot of the jobs offered at the website hosting that first photo are rail and oil industry jobs. Our oil production is largely independent of tariffs (if anything, it may be negatively affected, according to https://www.nytimes.com/2025/02/28/busi ... riffs.html ) and we’re not going to lay down new railways in response to tariffs.

You might as well be telling me about all of the new unicorn farms we’re going to set up in Alabama ‘because tariffs’. Claiming that we will create new pipefitter jobs doesn’t compensate for the fact that increasing prices by 25% across the board on everything from trucks to toilets will certainly negatively impact millions of Americans.

Given how MAGA bitched about how their weekly egg purchase had increased by $3, the same folks seem to have lost their voice about having everyone pony up 25% more on virtually everything beyond those eggs, to finance a tax cut for wealthy folks. It’s interesting to watch.

Well, you are avoiding my point, and answer. The middle class and income distribution, since free trade was made the norm, is destroying that middle class. You are picking one tiny example of this and running with it. The once vibrant communities of manufacturing are in decay, across the country. That is a reality, and sad.

What is happening is that because of lopsided trade (deficits) we are giving much of our wealth away, to the tune of some 750 billion dollars a year. There is a reason it is called "trade" cakes. And we are not very good traders these days. We are giving away dollars for pennies, and that is just a fact. And the dollars we give away as you unwittingly conceded, in many cases, especially with China, is being reinvested here, in things like treasuries.

What I am gathering from this conversation, given your reluctance to talk openly, is that you are in support of nafta, the WTO, and over all free trade. You seem to support us growing as a country of distributors, other that a country of manufactures. And no matter how you spin it, that ideology is shrinking the middle class.

So given that we are giving away dollars for pennies to Mexico, China, and Canada, at a tune of half a trillion dollars a year, how do we even that out? Or should we just do nothing and continue to watch countries grow in trade and manufacturing, while we decline in ours? You hinted at some sort of plan that I asked for examples of earlier, but you did not offer those examples.

Food for thought, were have the largest trade deficit of any country in the world, 3/4's of a trillion dollars, with countries like China, Mexico, Germany, Vietnam , Ireland, leading that way.....how do we even that out? They seem to be eating our lunch, almost literally.

One of Trump's solutions is to issue tariffs, keep our wealth here instead of exporting it, and have that money be invested here for our personal growth; what is the plan you support, I am all ears?

[canpakes]

You are picking one tiny example of this and running with it.

It feels more like you’re the one doing so, with this preoccupation over pipefitters.

Let me try something different.

Let’s say that you, Markk, are a successful metalworker living in Shadesville, MI. Your good friend John is a farmer living just across the border in Canada.

In 2024, you sold John 6 of your excellent steel garden hoes and 2 shovels.

You have several children in their teens, so you buy a good amount of John’s eggs, milk and Canadian bacon.

At the end of the year, John has purchased $720 worth of equipment from you, and you’ve purchased $1,350 worth of foodstuffs from John.

Seeing this, President Trump declares that Canada has a trade surplus with the US based on your and John’s commerce. Trump slaps a 25% tariff on Canadian goods.

In 2025, the same amount of foodstuffs that you will purchase from John will now cost you $1,687.50.

The difference between the two years - $337.50 - will go to the US government and be used to finance a tax cut for the owner of the bank that you pay your mortgage to.

Please tell me how this benefits you.

[Markk]

You are picking one tiny example of this and running with it.

It feels more like you’re the one doing so, with this preoccupation over pipefitters.

Lol...my preoccupation? You keep bringing it up. I mentioned lots of trades, you wanted to discuss pipefitters.

Let me try something different.

Let’s say that you, Markk, are a successful blacksmith living in Shadesville, MI. Your good friend John is a farmer living just across the border in Canada.

In 2024, you sold John 6 of your excellent steel garden hoes and 2 shovels.

You have several children in their teens, so you buy a good amount of John’s eggs, milk and Canadian bacon.

At the end of the year, John has purchased $720 worth of equipment from you, and you’ve purchased $1,350 worth of foodstuffs from John.

Seeing this, President Trump declares that Canada has a trade surplus with the US based on your and John’s commerce. Trump slaps a 25% tariff on Canadian goods.

In 2025, the same amount of foodstuffs that you will purchase from John will now cost you $1,687.50.

The difference between the two years - $337.50 - will go to the US government and be used to finance a tax cut for the owner of the bank that you pay your mortgage to.

That is just silly and has nothing to with world trade. We could go back and forth spinning pointless scenarios off of that. Like.... Nels and Harriet Olsen from near by Walnut Grove bought a wagon load of okay but lesser quality shovels and hoes from a shipping company, and John started buying hoes, shovels, and all his farm equipment from the Olsen's, so he could keep feeding his boys. This threatened to put me out of business along with other black smiths and in my area, until Mayor Isaiah Edwards put a tax on all of Harriet's farm equipment being brought in making my better hoes competitive. Thus Keeping Shadesville a once again healthy prosperous community, and I could buy two new anvils and hire two blacksmiths and almost double my profits.

You ducked my questions about whether or not you believe trade deficits are good for us. But this may be a cryptic way of your saying you do believe it is good for us to be approaching a trillion dollars a year in deficits. You are also skipping around whether you support nafta, WTO, and I'll add Bush's PNTR.

So one more time, when a country looses manufacturing and industrial innovation, we lose wealth as a nation. We lose good paying jobs.

We are exporting our money to China and again, in return, like you unwittingly conceded, they buy things like treasuries, and I'll add equities and even land.

How is having a 750 billion dollar world wide trade deficit healthy? Note, That is the low figure; some very smart people think it may be over 1 trillion dollars.

[Kishkumen]

I’ll throw this but I read on Reddit by a poster named “Distwalker” into the mix:

A trade deficit is absolutely, positively not an inherently bad thing. It is always situational and involves trade-offs.

In the nation's balance of payments there are two accounts to consider. Those are the current account and the capital account. The current account is essentially trade and the capital account is financial investment.

These two accounts basically balance out. In other words, (current account + capital account = 0).

Speaking generally, a greater US trade deficit leads to a greater capital account surplus.

This is the case because when the US runs a current account deficit, it must also run a capital account surplus, meaning that the deficit in trade is offset by a net inflow of foreign capital into the country.

If the US lost its capital account surplus, it would make it very difficult for the government to get the money to pay for its deficit spending. Could Americans fund it? Unlikely. Americans are terrible savers.

The US needs the Chinese and Saudi oligarchs to park USD in treasuries so we MUST buy more from them than we sell to them so they have the USD to do it.

When the US runs a trade deficit with, say, China it is a mixed bag of results but one result is that the US becomes net-importer of capital from China and China is net exporter of capital into the US.

Right now that is a very good place for the US to be. Unemployment is low and the inflow of capital not only helps grandma get her Social Security check, it funds growth in the US economy.

In other words not only is the US trade deficit not a bad thing, under current circumstances it is a very good thing.

https://www.reddit.com/r/AskEconomics/s/150XG6Arbt

[Gadianton]

All Trump is trying to do with his tariffs is to force other Americans to subsidise American factory workers.

well, what "Trump is trying to do" is anybody's guess, it may be nothing more than keep his face on the front page every day. He's not going to bring manufacturing back to the US in spades. Consumer confidence has crashed already, and business confidence isn't very good either. Nobody is going to invest billions insourcing. Even without his chaos it would be risky. One sentiment I'm seeing is expectations that Trump may really crash the economy, and if so, Republicans will lose 2028, and so businesses can sit tight for a few years and do nothing, and go back to business as usual when Democrats take it back.

Even a kool-aid drinking Trump supporter would need to think twice given the risk of loosing 2028 and the protections ending. (assuming the protections are good enough in the first place, which they probably aren't)

Both sides want to decouple and it's already in the works. Targeted insourcing can work. Targeted tariffs (not sweeping tariffs everywhere) with subsidies are more likely to work than tariffs alone. Biden put 100% tariffs on China EVs and in conjunction with billions in subsidies Musk has received over the years, you have to wonder what Musk is crying about. Hound seems to feel really sorry for Musk. If unhinged right-wingers of this board want insourcing, they can start by looking at what Biden has already been doing in a far more controlled way, and then Trump could build on that instead of just doing a bunch of rando nonsense and fear mongering.

Insourcing, if it's viable at all, is a long road, and will only work picking battles carefully and with both parties supporting the initiatives.

[Gadianton]

re: Kish,

To hear it from the demigod of conservative economics himself:

https://www.youtube.com/watch?v=zv5SiQpG6sg

[Markk]

I’ll throw this but I read on Reddit by a poster named “Distwalker” into the mix:

A trade deficit is absolutely, positively not an inherently bad thing. It is always situational and involves trade-offs.

In the nation's balance of payments there are two accounts to consider. Those are the current account and the capital account. The current account is essentially trade and the capital account is financial investment.

These two accounts basically balance out. In other words, (current account + capital account = 0).

Speaking generally, a greater US trade deficit leads to a greater capital account surplus.

This is the case because when the US runs a current account deficit, it must also run a capital account surplus, meaning that the deficit in trade is offset by a net inflow of foreign capital into the country.

If the US lost its capital account surplus, it would make it very difficult for the government to get the money to pay for its deficit spending. Could Americans fund it? Unlikely. Americans are terrible savers.

The US needs the Chinese and Saudi oligarchs to park USD in treasuries so we MUST buy more from them than we sell to them so they have the USD to do it.

When the US runs a trade deficit with, say, China it is a mixed bag of results but one result is that the US becomes net-importer of capital from China and China is net exporter of capital into the US.

Right now that is a very good place for the US to be. Unemployment is low and the inflow of capital not only helps grandma get her Social Security check, it funds growth in the US economy.

In other words not only is the US trade deficit not a bad thing, under current circumstances it is a very good thing.

https://www.reddit.com/r/AskEconomics/s/150XG6Arbt

I hope you don't believe that.

in my opinion, Short term deficits are a reality and ok, and it tends to balance out. And fluctuates between trade partners. Chronic transfer of wealth is not.

Nafta and the WTO can be tested now, and it has been a disaster. It is not like this was a Republican ideal, they supported it more than the left did in the 90's. John Lewis was a huge champion against free trade agreements, he understood it would take good jobs. Warren Buffet in 2003 wrote a piece that we had better get a hold on this.

I just can't fathom how selling out our industrial might over that past 30 -40 years, for consumption, is a good thing. Kish.... today the NIIP is around a negative 23 trillion dollars, and 20 years or so ago it was around 3 trillion. In other words, and I hope you understand this, we are being legally conquered by China and other countries as they buy our nation, in debt, equity in corporations and businesses, and real estate.... among other things.

I am still working on this thought as a comparison for the NIIP. Stalin said after the war, and for me it is a really profound quote that has stuck with me over the past 45 years in my World War 2 personal studies. He said in regard to the cost of the war, to the liberating allies..." the US paid with money, the British paid with power, and Russia paid with blood!"

We as a nation did fund the war, big time. The lend lease act basically kept Britain alive. We supplied Russia with equipment....etc. Also after the war we rebuilt Japan and Germany, and had bases all over the world, securing peace and provided humanitarian efforts (the Marshall plan).

So how did we do this? With Industrial might. And I believe Industrial might breeds innovation, big time. For every manufacturing job there are jobs created for support. I read the other day that 80% of engineering is tied one way or the other to manufacturing and industrial disciplines. This industrial might paid for the war, and reconstruction

What I am saying here is that because of nafta, and WTO, basically free trade, we have lost much of that industrial might that made the dollar the currency of the world, and the most powerful and productive nation, ever.

Will tariffs alone fix all this, no, but it is a kick start for us, along with other policies to stop being a nation of consumption, and return to be the Industrial leader in exports and innovation. This is a means to the end of getting back our middle class.

https://www.youtube.com/watch?v=1BIQLVV8YQA

[canpakes]

Lol...my preoccupation? You keep bringing it up. I mentioned lots of trades, you wanted to discuss pipefitters.

You actually introduced pipefitters specifically into our conversation and this thread here:

viewtopic.php?p=2889977#p2889977

When I ignored pipefitters in my annual wage recap of selected jobs, you asked again about them here:

viewtopic.php?p=2889999#p2889999

At that point I assumed that you harbored a secret desire to become a pipefitter, or something. But if you don’t, that’s OK. It looks like they don’t make a particularly high wage and are going to be hit hard by tariffs.

That is just silly and has nothing to with world trade.

It’s literally an example of ‘world trade’. Just as one transaction within it. Same principles, though.

We could go back and forth spinning pointless scenarios off of that. Like.... Nels and Harriet Olsen from near by Walnut Grove bought a wagon load of okay but lesser quality shovels and hoes from a shipping company, and John started buying hoes, shovels, and all his farm equipment from the Olsen's, so he could keep feeding his boys. This threatened to put me out of business along with other black smiths and in my area, until Mayor Isaiah Edwards put a tax on all of Harriet's farm equipment being brought in making my better hoes competitive. Thus Keeping Shadesville a once again healthy prosperous community, and I could buy two new anvils and hire two blacksmiths and almost double my profits.

OK. What have we learned from your scenario?

When some other business that employed other people imported less-expensive shovels, you implored the President to initiate a cost increase on all of another country’s exports to this nation, making everyone pay 25% more for goods from that country whether or not they were buying shovels. But at least you were supposedly able to hire two people (why?), although now you’ll need to pay them more than you would have before in order to provide them a ‘living wage’. And, many of your own purchases now cost an extra 25% as well, with that extra money going to finance a tax cut for … your banker.

Please tell me how this benefits Shadesville, because I’m not even sure that it benefits you in particular, or your two new employees who now have elevated living expenses.

You ducked my questions about whether or not you believe trade deficits are good for us. But this may be a cryptic way of your saying you do believe it is good for us to be approaching a trillion dollars a year in deficits.

Trade deficits, in and of themselves, are not inherently good or bad. If you read about that question from a number of reputable sources, they’ll likely confirm this conclusion.

So one more time, when a country looses manufacturing and industrial innovation, we lose wealth as a nation. We lose good paying jobs.

Deciding to repeat that over and over has no effect on the inaccuracy of it.

We are exporting our money to China and again, in return, like you unwittingly conceded, they buy things like treasuries, and I'll add equities and even land.

Isn’t that how capitalism works?

Is our standard of living and wealth worse, or better - on average - than what is seen in China? We’ve been running a trade deficit with them for 40 years.

How is having a 750 billion dollar world wide trade deficit healthy? Note, That is the low figure; some very smart people think it may be over 1 trillion dollars.

Then you’d best start preaching to CEOs to stop moving production out of the US, and you’d better start preaching to US consumers to stop wanting low prices or more choices.

[Markk]

Cakes: Trade deficits, in and of themselves, are not inherently good or bad. If you read about that question from a number of reputable sources, they’ll likely confirm this conclusion.

So then you believe that our current position of having a 750 billion dollar trade deficit is a good thing, and worth supporting our being in that position. I am interested in your opinion. A yes or no answer will do at this point, but if you would like to explain how it is either good or bad ( "okay" I guess), that would be great.

Deciding to repeat that over and over has no effect on the inaccuracy of it.

Okay great, I will take that as you believe we are not losing manufacturing and good paying jobs.

Cakes: Isn’t that how capitalism works?

Capitalism offers opportunity for free enterprise in business. And also to my point of view, and it is very bad business to export our money to another country, that wants to dominate us in hopes that the dollar is devalued in hopes the yen takes its place as the "worlds currency," and the advantages that come with it, and in turn loan that money back to us for a over 3% gain. I also believe that giving away our out of country owned wealth is a bad business trend, to the tune of around 20 trillion dollars in the past 20 years.

Capitalism allows freedom to make good and bad business deals. Being tens of trillions dollars in debt, and exchanging our industrial longevity for temporary consumption....in my opinion is a very poor business decision. I will note that you believe this is the right direction for us to go.

Cakes,,,Is our standard of living and wealth worse, or better - on average - than what is seen in China? We’ve been running a trade deficit with them for 40 years.

Our standard of living, for the middle class has declined. For the first time in history the top 1% of of the wealthiest have more combined wealth than the 60% of the middle class. And again in my opinion largely because of trading away our industrial might for being consumption...i.e. relying on foreign imports and trading in house manufacturing for distribution.

Trying to compare our standard of living with a communist country that still has slave labor and a policy called hokou, that basically means you live your life where you are born, and one has no opportunity to grow.

I looks like you are having a defeatist attitude and are justifying our decline by comparing it with a worse situation.

Then you’d best start preaching to CEOs to stop moving production out of the US, and you’d better start preaching to US consumers to stop wanting low prices or more choices.

I certainly wish they wouldn't, and I understand why, and I am supporting the President that is "preaching" for the CEO's to stop, and actually putting policy's in place to keep them here.

In my opinion the CEO's would gladly stay here if they can compete. Tariffs is the first and most visible policy to insure that there can be viable and profitable manufacturing here. Other wise they can't keep the doors open competing with countries that basically use slave labor to produce the same or similar products, along with all the dollar store crap. Keep in mind that, in dollars, that the average American worker makes around 58K a year, while the average Chinese worker makes around 16K a year, and the Mexican worker around 17K......so you can see why CEO's have to make those decisions. So I understand the realities here, at least generally.

We will always want lower prices and more choices, and if Trump's plan/s pans out it will all be relative at some point, if it does not work out we can always come back to the current system we have, and accept a declining dollar and dependence on other countries that want us defeated to produce the goods we survive on.

It is becoming more clear that you are okay and support, and raise the white flag that we can't be self sufficient as a nation. It just seems like you don't want to fully admit it.

[canpakes]

Trade deficits, in and of themselves, are not inherently good or bad. If you read about that question from a number of reputable sources, they’ll likely confirm this conclusion.

So then you believe that our current position of having a 750 billion dollar trade deficit is a good thing, and worth supporting our being in that position. I am interested in your opinion. A yes or no answer will do at this point, but if you would like to explain how it neither good or bad ( "okay" I guess), that would be great.

Sure. If I recall correctly, US trade balances out at around $6 out for every $4 in. It’s a pretty reasonable split. The ‘deficit’ side is so large because of the huge amount of trade overall, and shows that our economy is quite strong, with an expected amount of consumption due to Americans having sufficient resources to do so.

Tariffs slow consumption. They have to, given that the number of dollars available to chase goods doesn’t magically increase in step with applied tariffs. Now, if you were to alternatively cap imports to somehow create an ‘equal’ balance, what would you base your product decisions on? And how would that affect the cost of goods, with the same number of dollars now vying for a sudden deficit of $750 billion in merchandise and services?

Deciding to repeat that over and over has no effect on the inaccuracy of it.

Okay great, I will take that as you believe we are not losing manufacturing and good paying jobs.

The United States is responsible for about 16% of global manufacturing output. China is roughly double that, but that country’s population is about 3.5x ours. We should probably expect that as China’s population increases its standard of living that China will continue to hold the #1 spot.

But, having captured a third of all manufacturing production still sees the Chinese population at a standard of living lower than many first-world countries.

You keep talking about ‘manufacturing jobs’ as if they’re all paying high wages. As noted earlier in this conversation, they’re not necessarily doing so, even for auto workers. And with that being the reality of things, you’ve yet to even define what you think is a ‘good’ wage. Earlier you were knocking a $28/hour pay for Amazon warehouse workers but suggesting that a list of ‘manufacturing’ vocations were somehow better at the same pay levels.

But pay is only part of the equation. If a young family’s primary earner works at Nissan’s Smyrna, TN plant earning that rate, but doesn’t receive healthcare insurance coverage or any childcare benefit, then that worker is forking out an additional $2K to 3K a month for those services, on top of whatever they’re paying for rent or mortgage. And this is what’s killing off the middle class in America. It’s not so much the lack of jobs paying ‘x’ dollars and that happen to be in manufacturing. It’s not that flat screen TVs need to be somehow cheaper, and that iPhones should be $100 less, neither of which will happen anyway if we make them here. It’s the fact that the basics of family life are much more expensive than they used to be. If you were concerned about the middle class, then you wouldn’t be advocating for tariffs that will raise prices for struggling families by another 25 percent. You’d instead be seriously considering the other, extremely expensive factors and obstacles that face our struggling middle and lower income class.

Then you’d best start preaching to CEOs to stop moving production out of the US, and you’d better start preaching to US consumers to stop wanting low prices or more choices.

I certainly wish they wouldn't, and I am supporting the President that is "preaching" for the CEO's to stop, and actually putting policy's in place to keep them here.

In my opinion the CEO's would gladly stay here if they can compete. Tariffs is the first and most visible policy to insure that there can be viable and profitable manufacturing here.

Your answer then is to penalize 200 - 300 million lower- and middle-class consumers via tariffs, for the actions of CEOs preserving their increasing and record profits through moving manufacturing to other countries. And your CEOs will not be touched or penalized. Matter of fact, they’ll do better than ever before because Trump will be using those dollars sucked into the Treasury from tariffs to give those same CEOs significant tax breaks. And tariffs will ensure that prices will remain higher for the rest of us in the future even if we gain a few thousand manufacturing jobs.

Seriously, you’d do better to simply foot the bill for as many people as are directly involved in automobile assembly - approximately 330,000, by the industry’s count - to send that same number of Americans to medical school. Not only would those folks end up earning substantially more than from any manufacturing job, but that plan would also help ease medical costs and access in a measurable way for just about everyone.