(08-14-2016 09:23 PM)UofMstateU Wrote: (08-14-2016 08:27 PM)Owl 69/70/75 Wrote: (08-14-2016 08:24 PM)Hood-rich Wrote: Sorry but I just dont believe that there are nations not interested in doing business with the USA regardless of an agreement. It goes against all logic. We have 350 million consumers.
Sent from my VS980 4G using CSNbbs mobile app
More the problem would be nations erecting trade barriers to keep out our exports to them. If you want an economy that consists of going to Wal-Mart to buy stuff made in China, then we would be great. But we wouldn't have many middle class jobs left.
I'm all about free & fair trade. That being said, there are some countries that would implode into a chaotic civil war if they decided to block our imports and we did the same.
You are not negotiating from a position of strength if you lay out what we wont do, such as block imports like we get blocked. Or block imports if the currency is manipulated. You have no position of power to get a country to back off of it.
Free & fair trade? The problem is that most of the "unfairness" is self-inflicted.
Other countries don't make us impose the highest corporate tax rates in the world. And don't give me the sound byte, "but our effective tax rate is lower." Of course it's lower. People move profit-generating portions of their business overseas to be taxed at those lower foreign rates on those profits. And those profit-generating portions--generally manufacturing--are the activities that pay the highest wages. So there go our middle class jobs. That's the problem.
Other countries don't make us not have a national consumption tax, when they do. So if they have, say a 20% consumption tax, they get to charge 20% on everything they import from us, but we don't get to charge the same 20% on things we import from them. And they get to refund taxes of probably around 15% on everything they export to us (basically, the "subsidy" that you may read about), but we don't get to do the same on stuff we export to them. And this is all per international law, in the form of multiple agreements to which we are signatories, and that law provides that consumption taxes are not tariffs, so these provisions apply even when we have free trade agreements with the other country.
Now, fixing those things won't level the playing field with third world sweat shops. But they will level the playing field with places like Europe and Japan, where starvation wages and lax environmental and workplace safety rules do not apply. And our annual net trade deficit with Europe and Japan isn't much smaller than our net trade deficit with China, per US Census Bureau at
https://www.census.gov/foreign-trade/bal...dex.html#C
China $350 billion
Japan $70 billion
EU as a whole $150 billion
Non-EU
Norway $1 billion (bit of an outlier because of North Sea oil)
Switzerland $9 billion
The problem is not so much that we have a trade deficit with China, but that we have a trade deficit with virtually everybody. And those two policies--corporate tax rate and consumption tax--make a huge difference with respect to any country that doesn't pay starvation wages and doesn't have lax safety and environmental regulations.
Turn those Japan and Europe numbers around and we'd have a swing of $460 billion, which would more than offset China.
We can't compete with China for sewing up Nikes. Neither can western Europe. But what doesn't get enough attention is that we obviously have a hard time competing with western Europe as well. We can't fix the China problem, but we can fix the western Europe problem. And fixing the western Europe problem makes us more competitive to export more to China and close that gap too. Comparative advantage says we let China sew up our Nikes (until we fully automate and bring that back home, like Adidas is doing in Germany), and we focus on turning around the gap with Europe and Japan.
/
The perfect GOP candidate. Hillary. Not a troll. Many on here will agree.
