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Tariffs
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Horatio Parker
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TRIPS: The Story of How Intellectual Property Became Linked to Trade
http://triplecrisis.com/trips-the-story-of-how-intellectual-property-became-linked-to-trade/
http://triplecrisis.com/trips-the-story-of-how-intellectual-property-became-linked-to-trade/
Lumpenproletariat
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What's best for consumers, i.e., for the country.
The right tariff system
The U.S. (or really any country) should eliminate all the complicated "trade agreements" and just issue a simple one-page free trade manifesto to the world:
Market is open to ALL countries, without exception, on the same identical terms to them all.
Market is open to ALL industries/companies, without exception, on the same identical terms to all.
A very low tariff, equivalent to about 1 - 2%, across-the-board on everything, without any exception or distinction of any product type from another.
A new tariff computation based only on the volume and weight of the cargo. Weigh it on a scale, factor in the volume of the container, derive the exact tax based on that alone, without any inspection to assess the value of the contents.
Off to market!
And abolish anti-dumping laws.
Tell all the uncompetitive crybabies -- companies, workers, unions -- to shove it.
And if Martians land, or ETs from somewhere, non-humans, open the market to them too.
The right tariff system
The U.S. (or really any country) should eliminate all the complicated "trade agreements" and just issue a simple one-page free trade manifesto to the world:
Market is open to ALL countries, without exception, on the same identical terms to them all.
Market is open to ALL industries/companies, without exception, on the same identical terms to all.
A very low tariff, equivalent to about 1 - 2%, across-the-board on everything, without any exception or distinction of any product type from another.
A new tariff computation based only on the volume and weight of the cargo. Weigh it on a scale, factor in the volume of the container, derive the exact tax based on that alone, without any inspection to assess the value of the contents.
Off to market!
And abolish anti-dumping laws.
Tell all the uncompetitive crybabies -- companies, workers, unions -- to shove it.
And if Martians land, or ETs from somewhere, non-humans, open the market to them too.
It's not clear that adulterated milk powder and contaminated drywall are best for consumers...
whichphilosophy
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If workers are paid peanuts or next to nothing, then there is very little spending so the goods won't sell so much anyway.
When workers are paid more but not to bankrupt the company, they spend more create more jobs and share a little of the wealth they produced.
Rich countries pay high wages and poor countries pay peanuts.
whichphilosophy
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In England a Romanian may earn 1/2 to 2/3 that of an English worker in certain jobs. He/she will stay in shared accommodation. Then he or she will send money back home to buy a very cheap house.
This is called unfair competition where workers from failed economies will (though not intentionally) destroy the wages of the average worker in the UK.
Hong Kong maintained and still maintains a booming economy but not on cheap labour. It has anti competition laws that forbid paying foreign workers less than local rates. The companies can pay more if they like. This is how I earned a lot of money in Hong Kong
Would you like to sub your job to Bangladesh even if the person is not as experienced as you.
You are advertising the false concept of addressing costs alone with no concept of the value of work carried out.
If tariffs are needed keep them.
I worked for Chinese companies from from 1993 to 2010. The government will also subsidize the prices of its goods that go to Western countries. This is what unfair competition is really is.
Lumpenproletariat
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Safety standards must be the same for imports as for domestic products.
That's not what tariffs are about.
This is not about changing any of the safety standards. The safety standards have to be the same as for domestic products, and they must be equally enforced.
There may even be a need to make the safety standards tougher. And perhaps inspections for this purpose. Just no inspections to determine the value of the cargo.
That's not what tariffs are about.
This is not about changing any of the safety standards. The safety standards have to be the same as for domestic products, and they must be equally enforced.
There may even be a need to make the safety standards tougher. And perhaps inspections for this purpose. Just no inspections to determine the value of the cargo.
Lumpenproletariat
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Cheap labor, free trade, more competition = best for consumers and higher standard of living.
Despite bellowing blow-hards like Donald Trump and Bernie Sanders
There's nothing "unfair" about it. If it benefits consumers, which it does, then it's good for the economy, even if the uncompetitive worker has more difficulty surviving. The country as a whole is made better off because of the increased benefit to consumers.
Consumers benefit from the increased competition, and that's what counts.
There's no totally pure-free-trade country. But Hong Kong's is near the top of the list and has succeeded because of it.
Hong Kong may now be enacting some labor laws like this, but overall, going back 50 years or more, Hong Kong has benefited from cheap labor as much as any country has. But it's only to be expected, as the living standard increased because of the trade, there would be demands to protect the domestic labor with some crybaby laws to drive up wages.
But Hong Kong's prosperity is largely a product of cheap labor and global competition generally. And laws to artificially prop up wages are not likely to be enforced very well, and it's impossible to monitor all the wages companies pay overseas. So they can pass laws and preach "fair trade" and other slogans, but the reality will generally be more wage competition and continued cheap labor, despite some laws like this and some workers being protected. Others will not be, despite such laws.
You're probably one of the lucky ones for whom the law worked as intended. You probably benefited from the generations of cheap labor which helped to build the Hong Kong economy to its present prosperity. But protecting workers against wage competition will have an overall negative effect, forcing up costs and prices consumers have to pay.
But if you're lucky enough to be in the right place, you might experience a net gain from it. While most of the population overall is made worse off.
I wish I had a plush high-paying job that could be subbed. I don't feel sorry for high-paid workers who have guaranteed high wages because of laws protecting them against competition, and they want to increase this protection at everyone else's expense. It makes most people worse off. More competition is what makes us better off.
That's up to the employers and consumers to decide. No outsider needs to dictate to employers and consumers what the quality or value should be. Sometimes it's better to get a lower price and lower quality. It's up to the buyers to make that decision.
Their only value is to serve as one source of revenue for the treasury. So an accross-the-board low tariff on ALL imports, same to ALL companies and ALL countries, is best.
But it's only unfair to the taxpayers (and consumers?) of that country where the goods (exports) are subsidized.
It's more than fair to the Western countries who gain the benefits of that subsidy, to the Western consumers. You're right that those countries should stop doing this harm to their own citizens, by forcing them to pay higher taxes and prices in order to prop up wages and subsidize uncompetitive jobs and companies.
Despite bellowing blow-hards like Donald Trump and Bernie Sanders
There's nothing "unfair" about it. If it benefits consumers, which it does, then it's good for the economy, even if the uncompetitive worker has more difficulty surviving. The country as a whole is made better off because of the increased benefit to consumers.
Consumers benefit from the increased competition, and that's what counts.
There's no totally pure-free-trade country. But Hong Kong's is near the top of the list and has succeeded because of it.
Hong Kong may now be enacting some labor laws like this, but overall, going back 50 years or more, Hong Kong has benefited from cheap labor as much as any country has. But it's only to be expected, as the living standard increased because of the trade, there would be demands to protect the domestic labor with some crybaby laws to drive up wages.
But Hong Kong's prosperity is largely a product of cheap labor and global competition generally. And laws to artificially prop up wages are not likely to be enforced very well, and it's impossible to monitor all the wages companies pay overseas. So they can pass laws and preach "fair trade" and other slogans, but the reality will generally be more wage competition and continued cheap labor, despite some laws like this and some workers being protected. Others will not be, despite such laws.
You're probably one of the lucky ones for whom the law worked as intended. You probably benefited from the generations of cheap labor which helped to build the Hong Kong economy to its present prosperity. But protecting workers against wage competition will have an overall negative effect, forcing up costs and prices consumers have to pay.
But if you're lucky enough to be in the right place, you might experience a net gain from it. While most of the population overall is made worse off.
I wish I had a plush high-paying job that could be subbed. I don't feel sorry for high-paid workers who have guaranteed high wages because of laws protecting them against competition, and they want to increase this protection at everyone else's expense. It makes most people worse off. More competition is what makes us better off.
That's up to the employers and consumers to decide. No outsider needs to dictate to employers and consumers what the quality or value should be. Sometimes it's better to get a lower price and lower quality. It's up to the buyers to make that decision.
Their only value is to serve as one source of revenue for the treasury. So an accross-the-board low tariff on ALL imports, same to ALL companies and ALL countries, is best.
But it's only unfair to the taxpayers (and consumers?) of that country where the goods (exports) are subsidized.
It's more than fair to the Western countries who gain the benefits of that subsidy, to the Western consumers. You're right that those countries should stop doing this harm to their own citizens, by forcing them to pay higher taxes and prices in order to prop up wages and subsidize uncompetitive jobs and companies.
What is the logic here?!?!
Anti-dumping laws exist to prevent economic wars.
So you want plastic milk powder on our shelves?
LordKiran
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Open markets and regulation on foreign imports/domestic products are entirely separate issues from each other.
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You might think so. But in fact there is a long tradition of using inspection of goods and/or 'safety' regulations as a barrier to imports, where treaty obligations prohibit tariffs (or set a ceiling on them).
The EU and other countries refusing to import GMOs from the US is one example; as is the duration and scope of US bans on meat and dairy products in the wake of both the BSE and Foot & Mouth outbreaks in the U.K.
Such non-tariff barriers to trade can be very hard to break down, as usually they amount to a disagreement on the level and duration of risk. In theory, a nation could almost completely halt agricultural imports by strict adherence to the 'cautionary principle', wherein the mere rumour of a possible health or safety risk can be used to justify onerous conditions or outright bans on imported goods.
This problem is made all the more difficult by the clear fact that there are occasions when safety and/or health restrictions are needed. Spotting the real risks amongst the fake ones is not easy. And the diplomacy needed to break down such needless barriers to trade is particularly thorny, as direct accusations of lying could lead to trade (or even shooting) wars.
LordKiran
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Correct. With all that said however, Loren's argument is faulty on a rhetorical level as it aims to relate two sets of policies that do not necessarily have to be related. It also relies on the assumption that such regulations (Or barriers to trade) will make products safer for consumers.
Lumpenproletariat
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Low tariff (to raise revenue only, not to "protect" anyone) + total competition + SAME SAFETY STANDARDS FOR FOREIGN & DOMESTIC products.
Let the competition (war) go on between companies. But end the war on consumers, which forces them to pay higher prices. Steel companies, and others, should lose their war against consumers and be forced to confine their warfare to their competition against other companies/countries to better serve consumers. The consumers should not be made the collateral damage wreaked by these companies.
The basic principle should be:
ALL products, no matter where they came from, have to be subject to some safety regulations and inspections -- whatever is necessary to protect consumers. I.e., wherever the private market by itself alone cannot supply all the safeguards. This need is the same whether it's a foreign- or domestic-made product. So basically the same rules/procedures should apply to both without distinction. And there's no reason it cannot be done equally to both imports and domestic production.
But other than this need, we don't need to inspect the imports. All we need to do is weigh the container and combine this with the volume to make a quick calculation of the (low) tariff, which should be based on weight/volume rather than the supposed value of the contents.
All this can be initiated in a one-page Free Trade Manifesto (similar to the Monroe Doctrine?) issued to all countries, regardless of the current trade agreements. There is no reason for this to interfere with any current legitimate trade practice.
Let the competition (war) go on between companies. But end the war on consumers, which forces them to pay higher prices. Steel companies, and others, should lose their war against consumers and be forced to confine their warfare to their competition against other companies/countries to better serve consumers. The consumers should not be made the collateral damage wreaked by these companies.
The basic principle should be:
ALL products, no matter where they came from, have to be subject to some safety regulations and inspections -- whatever is necessary to protect consumers. I.e., wherever the private market by itself alone cannot supply all the safeguards. This need is the same whether it's a foreign- or domestic-made product. So basically the same rules/procedures should apply to both without distinction. And there's no reason it cannot be done equally to both imports and domestic production.
But other than this need, we don't need to inspect the imports. All we need to do is weigh the container and combine this with the volume to make a quick calculation of the (low) tariff, which should be based on weight/volume rather than the supposed value of the contents.
All this can be initiated in a one-page Free Trade Manifesto (similar to the Monroe Doctrine?) issued to all countries, regardless of the current trade agreements. There is no reason for this to interfere with any current legitimate trade practice.
How low would the tax rate have to drop in order to equalize American production costs with those of Asian countries? Would the tax cut include unemployment insurance payments and matching Social Security payments? What's on the table for your proper tax code?
Would the tax cut be enough, or would environmental and safety regulations have to be reduced as well?
Dumping very often involves government support--it's not free trade.
Lumpenproletariat
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Even if one country "cheats" it is still best for other countries to "obey the rules" by putting the consumers first.
translation: Our country has to practice protectionism (in one form or another) because the other countries do it, and any country that stops cheating (truly opens their market) puts itself at a disadvantage to the others who cheat in order to subsidize their companies or jobs by breaking the rules one way or another, e.g. by "dumping" or by imposing false product standards or environmental requirements, etc.
And the only solution is to put them on trial and prove that they're breaking the rules (which means there's really no solution), because they always claim they're really "playing fair" while accusing the others of practicing protectionism in some disguised form, i.e., of violating the free-trade rules in order to give their companies/jobs an unfair advantage.
We could take a step beyond this pettiness by just resolving to always put consumers first and never sacrifice consumers in order to protect certain companies or workers, because serving consumers is ALWAYS better, even if the other country is breaking the rules.
The outcome is better if the consumers are allowed to benefit from the other country's bad practices, i.e., allow those countries to subsidize our consumers if that's what they choose to do. Which is what they are doing if they increase their labor costs but sell at low prices in order to protect their jobs against the competition, even to the point of selling BELOW their production cost.
What's wrong with letting our consumers reap the benefit of this gift? This increases our overall standard of living, even if it means some job losses or other disadvantage to some workers. Still, the overall living standard increases when serving consumers is given the highest priority. And it toughens the competition domestically, which is also good for consumers. What net gain is ever made by reducing the competition? or putting any special interest above the consumers?
translation: Our country has to practice protectionism (in one form or another) because the other countries do it, and any country that stops cheating (truly opens their market) puts itself at a disadvantage to the others who cheat in order to subsidize their companies or jobs by breaking the rules one way or another, e.g. by "dumping" or by imposing false product standards or environmental requirements, etc.
And the only solution is to put them on trial and prove that they're breaking the rules (which means there's really no solution), because they always claim they're really "playing fair" while accusing the others of practicing protectionism in some disguised form, i.e., of violating the free-trade rules in order to give their companies/jobs an unfair advantage.
We could take a step beyond this pettiness by just resolving to always put consumers first and never sacrifice consumers in order to protect certain companies or workers, because serving consumers is ALWAYS better, even if the other country is breaking the rules.
The outcome is better if the consumers are allowed to benefit from the other country's bad practices, i.e., allow those countries to subsidize our consumers if that's what they choose to do. Which is what they are doing if they increase their labor costs but sell at low prices in order to protect their jobs against the competition, even to the point of selling BELOW their production cost.
What's wrong with letting our consumers reap the benefit of this gift? This increases our overall standard of living, even if it means some job losses or other disadvantage to some workers. Still, the overall living standard increases when serving consumers is given the highest priority. And it toughens the competition domestically, which is also good for consumers. What net gain is ever made by reducing the competition? or putting any special interest above the consumers?
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Another example of Lumpen not understanding that consumers ARE workers. Screw the workers for the consumers? WTF?
EricK
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The point is that the consumers he is talking about are actually workers in other industries.
Some people's jobs are based on producing, say, steel. Other people's jobs - and many more, when it comes down to it - are based on using that steel. Cheap steel imports helps the latter group keep their jobs, but it makes it harder for the former group to. But since the latter group is much larger the overall effect is generally beneficial. And this calculation even leaves out the people whose jobs depend on the things produced by that latter group, and the people who depend on *their* output, and so on throughout the economy.
If you are offered manna from heaven, you should grab it, rather than complain about the effects it will have on your manna producing industry.
Nonsense. Just imagine how much we would suffer if all the countries in the world devoted their workers to making free stuff for us.
Horatio Parker
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They practically do. We get their stuff, and they get dollars. Pretty good terms of trade, no?