Whether the Protectionist babble is from Bernie's mouth or Trump's mouth, it's just as bone-headed either way.
What is your opinion on Tariffs?
We have seen both Bernie Sanders and Donald Trump speak loudly against NAFTA this election cycle, and according to Michael Moore, Trump stood in front of auto companies and said "if you close these factories as you're planning to do in Detroit and build them in Mexico, I'm going to put a 35% tariff on those cars when you send them back and nobody's going to buy them."
Is that a good idea? Or would it just make things worse?
Punishing consumers can never make things better, but only worse. Consumers are the winners when the companies relocate to reduce their costs. Protecting a few thousand uncompetitive workers at the expense of 300 million consumers is always a loser.
I am reluctant to endorse any of Trump's ideas.
But they're not just his bad ideas, but also those of Bernie Sanders. These bad ideas would hurt our economy no matter which demagogue preaches them at us.
They seem to be nothing more than pandering to the audience that is in front of him at the moment. They are based on a confused mess of misinformation and out and out lies as has been ever presented in a presidential campaign before.
But worse than the "misinformation" is the phony premise of Trump and Sanders etc. that the role of business is to provide "jobs" to workers rather than to serve consumers. The debate is always about whether we lose "jobs" or whether the trade actually "creates" jobs, as the pro-trade side always tries to prove. The confusion is caused by this phony premise which is never questioned but always accepted as a sacred dogma.
Why must we continue to define the success or failure of trade based on this phony premise? Are the workers or job-seekers a group of crybabies we must pander to even to the point of punishing consumers and choosing a lower standard of living for the large majority only in order to provide these babysitting slots for the "workers" because we feel sorry for them? Why should the rest of the country have to pay the cost of providing these "jobs" to a small minority of uncompetitive "workers" out of pity for them?
This is the confusion that both sides of the debate are causing and which no one addresses. Why don't they ever explain why it's necessary for the country overall to make this sacrifice in order to prop up uncompetitive "jobs" for this minority of overpaid "workers"?
There is no cohesion among his proposals, with many contradicting the others. Which is not surprising because Trump couldn't keep track of the lies that he told. He frequently denied even saying something a day after he said it.
That's why he's such a good spokesperson for protectionism.
The free trade, open borders philosophy that sent so many of our manufacturing jobs offshore and did so much damage to people in the US . . .
Only to a few uncompetitive. The vast majority (as consumers) have experienced a net benefit from the increased competition and cost savings.
. . . was the product of and until Trump, a required position to hold to be a Republican and a conservative.
On trade it's been ambiguous, with the smart conservatives recognizing the benefits of free trade. But on immigration, the vast majority of conservatives have been beating the drums for cracking down on the employers and rounding up the illegals who are "stealing our jobs" and driving down "our wages" -- if you listen to conservative talk shows you hear this repeatedly.
And also many of the callers to Conservative talk shows beat up on the companies for "shipping our jobs overseas" to those damn Chinese who are "stealing our jobs" etc., but most of the radio hosts don't usually pander to these ignorant callers. But they pander to the immigrant-bashing conservative callers who complain about the cheap labor and bash the greedy employers.
Laura Ingraham has been an immigrant-basher and free-trade-basher for years, and Sean Hannity is becoming one. And others -- Roger Hedgecock bashing the greedy employers.
More and more they are saying, "I believe in free trade,
BUT,
BUT . . ." and then a long torrent of protectionist babble comes pouring out of their mouth.
Free trade and open borders for legal, H1B1 visas, and illegals are required to maximize the exposure of workers wages in the US to suppress those wages by exposing workers here to wage competition from low wage countries.
The vast majority, including the poor, have been made better off from it. It's worth it to sacrifice a couple million "jobs" in return for a higher living standard to 300 million consumers (or, most pessimistically, 299 or 298 after subtracting the 1 or 2 million lost jobs).
Suppressing wages boosts profits which . . .
But no one is "suppressing" wages, anymore than you as a consumer are "suppressing" the store-owner's income if you shop for lower prices.
So when the market drives down wages, due to wage competition, that's the legitimate normal wage, and anything higher than this is an artificial PROPPING-UP of the wage level, such as happens with protectionism. And this lower wage level, due to competition, not only rewards the employer who made the right cost-saving decision, but also boosts consumer spending power by keeping prices down.
Suppressing wages boosts profit which in turn boosts the income of the already rich.
But when their profit goes up in return for serving consumers better, it's a reward they deserve. Anything which reduces cost results in lower prices to consumers and so boosts their real income. The whole idea of profit is to reward the producers for serving consumers better.
Which is the goal of the Republican party and of movement conservatism.
It's the goal of any sensible economics to serve consumers. The function of business is to serve consumers, not provide costly babysitting slots ("jobs") to keep the rabble off the streets.
This is why they embraced the unsupported economic tenets of neoliberalism.
The only genuine "tenet" is that consumers should be served, and those producers who serve them better should be rewarded. And increased competition makes this happen. Competition across-the-board, including WAGE COMPETITION. ALL producers competing. The more competition the better.
The economic tenet which is false and contrary to anything rational is the protectionist dogma to artificially boost up the wage level and try to punish employers who put consumers first rather than providing babysitting slots for job-seekers.
Not because neoliberalism has any empirical or even any theoretical support, it doesn't, . . .
What has complete theoretical and practical support is whatever "ism" promotes more competition to force the producers to serve consumers better. This is what works, not punishing them for doing the right thing and forcing them to take on the babysitting role demanded by the perverse protectionist theory and by the labor union demagogues.
. . . but because neoliberalism's conclusions appealed to them. Those conclusions broadly are that only the rich can be trusted with the money.
No, it's those who are more competitive who should gain more money, and so they might get rich as a reward for performing their obligation to serve consumers better. That's the way they are to get richer, and we're all better off when they do get richer as a reward for doing what's right for the country.
Tariffs are only one way of protecting our workers and their wages. Quotas, capital controls, fiscal expansionary spending, subsidies, rationing, are all effective to varying degrees along with tariffs.
But anything that punishes consumers is bad for the country and NOT "effective" at anything other than pandering to crybabies. It's not worth it to "protect" workers "and their wages" if this is done by assaulting the consumers with higher prices.
The rule is simple: Don't protect the workers by punishing consumers. If you know some other way which doesn't force consumers to pay higher prices, then fine. Protect everyone any way that doesn't inflict punishment onto others who have to pay for it.
(And we need to stop the pretense that it's "our workers" being protected, as if ALL workers benefit. ALL of them have to pay the higher prices as the penalty while most gain no benefit and so are made worse off overall.)
But the very fact that many here threw up after reading this list tell us how successful the neoliberals of the Republican party have been demonizing these ideas and the idea of protecting jobs and wages in this country. The result has been the largest foreign aid and jobs program in history resulting from the ½ trillion dollar trade deficit. Money leaving our economy to boost the economies of China, Mexico, etc.
"Money leaving our economy" = Moonbeam Economics. You can pour the money in or take it out -- you can dump a trillion dollars onto the economy and this is not what makes the economy work better or worse.
We don't make the economy stronger by preventing "money leaving our economy" and other snake-oil economic theories. When money really leaves, or the money supply actually decreases, then prices also decrease = deflation = no net change, because this just means everything falls equally. And in the REAL world the inflation rate is still higher than zero, so there is no damage from any "money leaving our economy" and less money circulating.
The only real damage that can happen is if the inflation rate jumps or plunges drastically, all at once, in a sudden surge or a sudden plunge. We've had exactly the opposite of this over the last 20-30 years of increased trade and cheap imports.
The irony of this is that the push back against these neoliberal policies has resulted in the election of a billionaire Republican with not a chance of anything changing.
Hopefully so and he has only been lying and playing a con game. But if not and he does what the Bernie Sanders gang wants, we'll see the wrong kind of change: Prices will rise if he cracks down on trade like he says and if he kicks out our illegal immigrant workers who are helping to keep down the prices.
Rather the certainty of doubling down on the policies, making things worse, not better.
What will make it worse is to do what Bernie Sanders and the union bosses clamor for -- i.e., crack down on companies for outsourcing and hiring cheap labor. Punishing them for doing what's right -- saving on labor cost and thus serving consumers better -- is what makes things worse and not better.
