I am interested in the news this morning that around the world there is anger and disgust about Trumps plan to impose tariffs on imports...
Personally, and hold the front page here, I actually agree that any and every country should protect and support their own businesses and therefore their own jobs and populace.. I am a Brexiter remember so for me it wasn't about immigration. My purpose isn't to discuss that, just the trade implications.. .
So Canada is miffed, and France is, and the Brits are making grumbling noises etc.. and some of them are threatening retaliation... which they are saying could spark the beginnings of a trade war; i.e. where countries start imposing heavy tariffs on goods imported from America to their country....
I talk to a lot of Americans and I have noted that some of them express quite frequently that America doesn't need the rest of the world and they tend to be quite dismissive about it,feeling America is the best and they are utterly superior.. I guess we can all feel that way a little about our country. But my thinking is that, it probably is not realistic.. Right or wrong we live on an international platform where much of our economy's strength and income comes from exporting and trade with other countries, money from exports especially..
So on this one, while I agree with the sentiment, I am wondering whether imposing tariffs may not be the right solution. I am not sure what is - but I am thinking there could well be unforseen consequences of such an aggressive move.. wouldn't it be wrong to discount the repercussions?
PS no axe to grind here.. UK would like trade deals with US but we import way more than we export so....
I am interested in your thoughts.. please remain civil though, no insults needed, not even indirect ones..
This should be a simple economic question, but it is unfortunately shot through with politics and so emotional.
The slogan 'America first' may resonate with Trump's supporters in rundown steel areas, but ultimately the rest of the USA will pay the tariff either directly or through the US industry taking advantage of the hike in the competitive benchmark.
In the HD example above, when they go to India, they will most likely find that Chinese steel is even more competitive than before. I doubt if it ever was sensible economics to use US labour when Indian wages are so much less, effectively imposing an unfair burden on India anyway.
This post was edited by Malizz at June 2, 2018 3:31 AM MDT