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Trade War with China escalates

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2 hours ago, CV147 said:

 

American industries put forth considerable investment in R&D. I don't think we should just give it to China.


"Fair" trade should mean on equal footing. What about duty-free both ways makes their workers less productive? If we can build new and better widgets, so can they. Reverse engineer our stuff. I think that's fair. Just don't ask our companies for their trade secrets as a perquisite to being in your market. Imagine if we asked the same from Germany.
 

I said it contributed. I didn't say it was the only reason. I understand the union role in diminishing quality and shrinking sales.

Fair is something grade school kids argue over.  The word fair is something that we who operate in the real world don't have the convenience of worrying about.

I see no way Trump gets a "fair", trade deal with China.  No way to enforce it.

So in trying all we are going to do is lose american jobs, pay more for stuff and create instability in a trading relationship which is never good for business.

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From an article this AM in Yahoo Finance:

The new tariffs will raise the cost of thousands of everyday items, including electronics, appliances, bicycles, tires, toys, clothing and footwear. Based on last year’s level of imports, the new China tariffs amount to a tax hike of $32.5 billion per year. If the latest set of tariffs rises to 25% and stays in place for 2019, the total additional tax would be $62.5 billion next year. The Trump tax cuts, by contrast, lowered tax payments by about $130 billion per year. So by this simple math, the China tariffs would offset about one-fourth of the Trump tax cuts this year, and nearly one-half next year.

Thay Haif Said: Quhat Say Thay? Lat Thame Say

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15 hours ago, bluerules009 said:

 

I just don't see how we can enforce intellectual property rights   Even if we get china to agree on paper.  I don't see how we can keep them from manipulating currency.  I don't see how we can keep them from dumping low priced goods on markets to run American competition into bankruptcy.

 

So I just have a hard time envisioning a way we can actually win.

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9 hours ago, renoskier said:

Yes. The status quo was fine.

If the US is buying more shit from China than visa versa,  who's really winning?

The status quo was fine in a lot of ways.  However it did incentivize companies to produce in China vs in the US.  And in the past a heck of a lot of the products made in China were not being bought by Chinese people.  China did not really have much of a middle class until about the last 18 years or so and then it has grown quickly.  
Now China has much of the technology needed to produce high tech items and they are actively investing and subsidizing in things like semi conductors, AI, electric cars as well as heavy industries like steel and machinery.  It will be difficult for companies to compete in the world market with heavily subsidized Chinese companies, and very difficult to sell products into China at all - which it already is in several industries.  China has centrally managed their economy which includes all companies and imports and exports and looked for ways to exploit markets to their advantage. 

China's economy is growing faster than the US or Europe, which is to be expected since its much less mature.  But it is already nearly the worlds biggest economy and the Chinese gov't is actively using its policies to restrict foreign competition.  If left unchecked in another 10-12 years China would completely dominate most high tech industries.  And with their huge market, as well as the other huge Asian markets including India, they would be much less reliant on the US or EU markets and much less willing to compromise on world trade.  
China is already actively trying to move away from producing cheap  crap like clothes and plastic toys etc. as those industries don't produce near the value that things like electric cars or computer equipment.  And China is spending much more on their military than in the past, they created these military bases in south China sea islands that will enable them to completely control the shipping lanes there. 

Right now the US economy is the strongest its been in a long time, right now is the best time and probably the last time the US can actively force China to alter their trade polices.  China may not bend but it is going to cost them billions, it already has cost them billions and foreign investment into China has already slowed.  I think these  tariffs could have been handled a lot better and I hope we can get the deal done with Canada soon too.  But right now tariffs are about the only way to nudge China, the only real alternative is to completely restrict Chinese imports and of course they would do the same and that would be much worse than tariffs.  

The thing to keep in mind is these tariffs are not meant to be permanent tax increases.  They are being used as a tool to force other countries to make fair trade deals. 
And this is one of the reasons I like having Trump as President, he is actively working to remake these trade deals.  Bush and Obama did next to nothing to improve these things.  
 

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11 hours ago, bluerules009 said:

Fair is something grade school kids argue over.  The word fair is something that we who operate in the real world don't have the convenience of worrying about.

I see no way Trump gets a "fair", trade deal with China.  No way to enforce it.

So in trying all we are going to do is lose american jobs, pay more for stuff and create instability in a trading relationship which is never good for business.

AMEN. Who gives a shit about fair? The old deal made us richer. The new deal, in my opinion and the opinion of many, many, many trade experts, will have less beneficial economic impact.

You have to deal with the hand you're dealt. We had an awesome hand and we were playing it well, now we're folding and drawing again because we didn't have a royal flush. It's stupid. 

Remember that every argument you have with someone on MWCboard is actually the continuation of a different argument they had with someone else also on MWCboard. 

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1 hour ago, pokerider said:

The status quo was fine in a lot of ways.  However it did incentivize companies to produce in China vs in the US.  And in the past a heck of a lot of the products made in China were not being bought by Chinese people.  China did not really have much of a middle class until about the last 18 years or so and then it has grown quickly.  
Now China has much of the technology needed to produce high tech items and they are actively investing and subsidizing in things like semi conductors, AI, electric cars as well as heavy industries like steel and machinery.  It will be difficult for companies to compete in the world market with heavily subsidized Chinese companies, and very difficult to sell products into China at all - which it already is in several industries.  China has centrally managed their economy which includes all companies and imports and exports and looked for ways to exploit markets to their advantage. 

China's economy is growing faster than the US or Europe, which is to be expected since its much less mature.  But it is already nearly the worlds biggest economy and the Chinese gov't is actively using its policies to restrict foreign competition.  If left unchecked in another 10-12 years China would completely dominate most high tech industries.  And with their huge market, as well as the other huge Asian markets including India, they would be much less reliant on the US or EU markets and much less willing to compromise on world trade.  
China is already actively trying to move away from producing cheap  crap like clothes and plastic toys etc. as those industries don't produce near the value that things like electric cars or computer equipment.  And China is spending much more on their military than in the past, they created these military bases in south China sea islands that will enable them to completely control the shipping lanes there. 

Right now the US economy is the strongest its been in a long time, right now is the best time and probably the last time the US can actively force China to alter their trade polices.  China may not bend but it is going to cost them billions, it already has cost them billions and foreign investment into China has already slowed.  I think these  tariffs could have been handled a lot better and I hope we can get the deal done with Canada soon too.  But right now tariffs are about the only way to nudge China, the only real alternative is to completely restrict Chinese imports and of course they would do the same and that would be much worse than tariffs.  

The thing to keep in mind is these tariffs are not meant to be permanent tax increases.  They are being used as a tool to force other countries to make fair trade deals. 
And this is one of the reasons I like having Trump as President, he is actively working to remake these trade deals.  Bush and Obama did next to nothing to improve these things.  
 

Wasn't the TPP an attempt to address a lot of these issues especially the bolded part. If we would have joined the TPP I think it would have been much easier to get China to the negotiating table.

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24 minutes ago, tspoke said:

Wasn't the TPP an attempt to address a lot of these issues especially the bolded part. If we would have joined the TPP I think it would have been much easier to get China to the negotiating table.

Well that was the republican orthodoxy way of thinking, and regardless of who won 2016, it is pretty obvious that it was republican orthodoxy that lost the most

Remember that every argument you have with someone on MWCboard is actually the continuation of a different argument they had with someone else also on MWCboard. 

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The unemployment rate in the United States has steadily dropped since 2009:

https://data.bls.gov/timeseries/LNS14000000

What the current trade war will do is increase the cost of goods for American consumers.  The argument is being made that the tariffs are only temporary and will go away at some unknown future date when fewer goods are imported from other countries.  As if cheap imports would not resume after the "temporary" tariffs are lifted.  

What the tariffs actually do is allow U.S. companies to jack up prices and make more money.  The losers, as usual, are the people who are working now and will see their cost of living increase while their wages remain stagnant. 

 

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