I have been a strong proponent of the notion Trump is likely to start a global trade war.
Others are of the opinion that Trump will not do what he promised.
Politicians lie. Who can argue with that? So, which viewpoint is more likely?
Please consider Donald Trump Threatens the Resilience of World Trade.
Like cats in popular folk wisdom, globalisation appears to have many lives. The integration of markets in goods, services and capital that accelerated in the 1990s with the fall of communism and the rise of China has been written off many times, notably during the global financial crisis. Yet it has survived.
This past year, its obituarists have had more material to work with than usual. The stalling of a number of high-profile trade deals has had the pre-emptive mourners out in force arguing that the engine of liberalisation has failed.
A number of large trade pacts — usually dubbed “free-trade agreements” whether or not they succeed in liberalising commerce — have failed in recent years. But 2016 was notable for two particularly large ones hitting the buffers — the Transatlantic Trade and Investment Partnership (TTIP), involving the US and EU, and the Trans-Pacific Partnership (TPP) of 12 Asia-Pacific economies. Moreover, the trade world was treated to some comic relief late in the year when the smaller pact between the EU and Canada was held up for a while by obstreperous Walloons, the government of Belgium’s francophone region objecting to various provisions therein.
The underlying forces against globalisation are often overstated. But Mr Trump’s election could change everything.
He has already appointed two instinctive protectionists itching for trade confrontation with China, Wilbur Ross and Mr Navarro, to his trade team. It may be up to Congress to restrain the administration’s wilder protectionist impulses — which is a little like putting the toddlers in charge of a nursery.
Globalisation has survived many things, but the rise of mercantilist populism in the form of Mr Trump may be its biggest challenge for decades. The year of 2016 was not a disastrous one for international commerce, but it may prove to be an uneasy calm before the trade wars begin.
Global Trade Wars
I am a huge free trade advocate, regardless of what any other country does.
Trump clearly does not share that view. But will Trump really do what he says? Will Congress go along?
I have an open mind on this, but right now it seems that Trump is more likely than not to do what he says.
Global Trade Wars
I have been warning about the increasing likelihood of a collapse in global trade for some time.
We took another step down that road with Trump’s appointment of Peter Navarro to head up the White House National Trade Council.
It’s impossible to over-emphasize one simple point: No one wins global trade wars. Trump believes he can.
He won’t.
The Question of “Fair Trade”
Some argue we do not need free trade, we nee “fair trade”. They are mistaken.
The best case I have seen for free trade comes from Ana Eiras, Senior Policy Analyst on International Economics, Center for Trade and Economics (CTE).
Eiras explains Why America Needs to Support Free Trade.
Eiras provides five well thought out positions why free trade is good. More importantly she puts a knife in the ridiculous discussion about “fair trade”. Let’s pick up the discussion from that point.
The Question of “Fair Trade”
Politicians, opinion makers, journalists, and businessmen commonly talk about the need to support “fair trade.” Seldom, however, does anyone explain either what fair trade is or–even more to the point–to whom trade should be fair. In the name of fairness, different groups advocate different protections for their specific industries and call the comparative advantage of other countries “unfair.”
For example, U.S. manufacturers think it is unfair that labor in China is cheaper than labor in the United States, and therefore ask for tariffs against Chinese products. But those tariffs would, in reality, be unfair to millions of U.S. consumers and producers who would be forced to pay higher prices for locally manufactured goods. “Fairness” assumes a dubious character in policies that pick and choose whom to treat “fairly.”
Others argue that America needs to enact barriers to free trade in order to strengthen national defense. For example, a tariff to protect steel would be justified because we need our own steel to support the construction of tanks, missiles, and arms. This argument is built on the faulty assumption that America’s wealth is at least constant. But a constant level may imply that the U.S. is falling behind other nations in relative terms. The strongest national defense depends on a relatively strong economy, and a strong economy is possible only with economic freedom.
Once economic barriers begin to emerge, a nation’s wealth begins to decline. America’s relative economic freedom and wealth have already begun to decline. In fact, according to the Index, the United States has lost considerable ground in economic freedom (declining from 4th freest economy to 10th freest in 2004), which means it has also lost more and more opportunities to increase wealth.
The only form of fair trade–if such thing exists–is free trade. When facing competition from Chinese manufacturing, U.S. manufacturers have two options: either adopt new technologies to cut costs and become more competitive or shift the focus of their operations to different areas in which they can be more competitive. Neither of these two options harms consumers, since they will continue to have access to the least expensive, best-quality products.
Most workers benefit as well. For some people, free trade requires change, but they also now have opportunities to use their skills in more efficient, advantageous, and productive ways that are created by the innovation and prosperity that competition promotes. Likewise, for a strong national defense, America needs the resources, innovation, and income that are derived from the absence of barriers to trade and investment.
Consumers Key to Debate
Consumers are key to this debate. If it’s good for consumers, it’s good for the economy, and by default it is good for trade.
I encourage everyone to read the rest of Eiras’ excellent article.
Fair Trade Fantasy
“Fair trade” is nothing but a misguided fantasy from producers who cannot compete in the real world.
It makes no economic sense for US citizens to pay double or triple for underwear, TVs, phones or anything else to “save American jobs”.
The amazing irony in this debate is no jobs will be saved anyway!
NAFTA did not cause a loss of manufacturing jobs, productivity and robots did. No matter what Trump or anyone else promises, those jobs are not coming back.
Sure, the US has misguided tax policy that encourages foreign production. But that is a separate issue. At least Trump is correct on that score. Lowering corporate taxes is the right thing to do.
Tariffs are precisely the wrong thing to do. I fear we are going to find that out again, while the parrots all chant “Fair Trade, Not Free Trade”.
Related Articles
- December 22, 2016: “Death by China”: Beijing Fires “Trade Cooperation Warning” at Trump
- December 12, 2016: Global Trade War Baked in the Cake: Boeing Faces China’s Wrath.
- November 21, 2016: EU Retaliates Against US Banks, London: Global Trade War Tit-For-Tat
- September 22, 2016: US-EU Trade War Looms (Don’t Just Blame Trump); Spotlight on Hillary’s Global “Trade Prosecutor”
- September 26, 2016: Draghi Increases Risk of Global Trade Collapse With Brexit Tough Talk
Mike “Mish” Shedlock
I hope the open borders globalization, where asylum seeking system is abused by millions of people who are not seeking safety but are in fact passing through many safe countries trying to reach those countries with the most generous welfare and most incompetent immigration bureaucrats, will be stopped.
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The open borders have to stop to give the local people more security by stopping criminals and those criminals who got inside the countries during the globalist open borders time have to be deported back home and prevented from coming back.
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The asylum system has to be reformed so that neighboring countries take care of all refugees and western countries support this financially instead of the current style of moving them to welfare paying countries in europe.
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Smuggling of people through the mediterranean sea risking their lives has to be stopped by creating secure borders with fences between Greece and Italy and rest of Europe and moving to a system where people saved at sea or who reach the beaches of Greece and Italy are taken back to Turkey or Marocco/Tunisia immediately and this can be done when the numbers that are coming have dropped to small amount after the route to welfare europe from Greece and Italy is blocked.
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Each of worlds peoples should have their own country and people who move there should be integrated into that culture. Those kinds of immigrants which are currently mostly muslims who refuse to integrate and actually think western cultures are bad and inferior despite coming to live in western countries should be returned back home.
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Those muslims which stay in europe have to be westernized completely by stopping the practice of getting husbands and wives from back home for the western born children of muslims because these arranged marriages are bringing their backwards attitudes with them and radicalizing the european muslim population and giving their future kids really bad starting points in life because most of the time they do not have skills to get employed and many either live on welfare or live in complete cultural bubble where they live like they did back home and speak the language they spoke back home instead of integrating.
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Giving of western european citizenships to people who are on welfare has to be stopped.
The newest lunacy is giving western european citizenships to people who do not even speak the local language if they have “learning” difficulties or are at home taking care of kids and can not therefore learn the local language.
Integration has to happen first and citizenships should be only be given to working people. The current idea to integrate asylum seeker based and family re-unification based immigrants by giving them everything without any of their own effort is complete leftist cuckoo-land craziness.
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World has to be multicultural so that each country has their own unique culture and immigrants respect that and integrate to the local culture.
The current multiculturalism where all of western europe has muslim populations which do not integrate but keep their original culture is NOT multiculturalism but backwardness and it is creating monoculturalist areas inside western europe some of which are turning into no-go-zones for regular local people and authorities.
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katsaus,
You and I have at least one thing in common. Neither of us define ‘Globalism’ as a free trade theory such as what you might see in a textbook about International Economics.
Rather, it’s a political movement that nobody would accept if offered and presented honestly. It’s a sneak attack on the 99.9% who just want to live a normal life without games, pretensions, and goofy theories that intend to socially engineer society into an eventual dystopia for a large percentage of the 99.9%. The social engineers, I’m sure, don’t see dystopia; they confuse it with a Utopia for some and don’t think much about the others.
The monetarism that we have endured for the past 8 or so years is one tool of the globalists. However, to make it work, all major central banks need to be on the same page and supporting each other. Trump blew that plan out of the water by being elected. Hillary or any of the stock Republicans would have been conducive to a continuation of QE and low to negative interest rates for another 4 to 8 years, creating a situation that likely would have been nearly impossible to back out. QE pays the bills of government. Managed interest rates assist. Negative interest rates destroy capital formation. They serve as both automatic tax collection to pay for government services that are deficit financed and are a sneaky means to turn debt into revenue if negative rates are low enough and the term of the debt is long enough and the actual rate of inflation is high enough, providing cash is eliminated – as is beginning to occur elsewhere and has been proposed here in the US by luminary economists.
Globalism has more to do with a backdoor takeover of world economics than free trade. Control of central banks and central bankers was/is key. Bizarre theories were developed to support it, such as those accepting negative rates as good, using QE to monetize sovereign debt, and managing interest rates to artificially low levels, along with the academic / social pressure to conform or be consider an outlier. It’s also a long game. Endless war somewhere appears to be another facet of globalism.
What’s still unclear is ‘who is the driving force behind the plan?’ Regardless of who is in power or sitting on a central bank board, the plan would have continued. The faces might change, the overall direction and forward motion continues – or continued until Trump was elected and the Fed relented to at least tiptoe into rate normalization and unmanaged economics. Yet to be seen is how Trump, the President, deals with the globalists.
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http://www.zerohedge.com/news/2016-10-26/dark-agenda-behind-globalism-and-open-borders
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First reply in moderation.
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cdr,
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I agree with you.
Zero interest rates are unhealthy because they encourage mal-invesments such as stock buybacks and excessive executive bonuses and destroy the earnings power of savings for tens of millos of people who are not playing the stock market and destroy the chance to pay for retirement benefits of future retirees with the current retirement funding model.
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The biggest problem is that increasing levels of debt masks the consequences of politicians decisions.
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The offshoring of millions of well paying jobs should have caused a drop in consumption so that politicians would have noticed much earlier that this kind of offshoring was unsustainable and there would have been bigger political pressure to stop it but increasing debt levels for individuals and the government and lowering of interest rates masked this issue so the offshoring large companies could get the savings from offshoring and still earn big profits by selling to americans who were consuming with just debt both on the individual and government level,
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Likewise the destruction of wages in low paying jobs for tens of millions of americans and the unemployment for many millions of americans caused by illegal immigration and the additional burdens on states and federal government by illegal immigrants and the costs in schooling and healthcare and crime that they cause were masked by the debt bubble and the artificially low interest rates.
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Mish, you need to stop reading the FT. It used to be a good paper many years ago, but its garbage now.
Glad to see you seem to be changing your tune (or maybe just explaining it better?) about “free trade” versus “fair trade”
****Free trade*** is a two way street. Some places specialize in underwear or TVs (China) while others specialize in software or chemicals or leatherwork — but everyone is free to sell their goods to the other countries. While the world has been promised free trade by lying criminal politicians, for the most part it remains a goal for the future.
The US can compete and we will do just fine if we get free trade (admittedly, some Americans may have to stop making underpants and start making something else).
Too many left wingers in Washington seem to think its OK for the US to open its borders to other countries goods (so far OK), but the same traitors (Obama for example) think its OK for those other countries to tax US products, steal intellectual property, or make US goods sit and rot in a customs warehouse for months.
Fair trade is some bullsheet the academics came up with to justify discrimination against US citizens. It goes hand in hand with their notion that white people are somehow evil (even the professors who are white seem to have joined this cult). Of course, these same academics insist on charging 10-12% tuition hikes (so they can pay more cult members) and insist on colleges getting tax free status for political indoctrination.
“Fair trade” is just left wing political obfuscation, it has nothing to do with economics — but everything to do with why Americans hate Obama and Hillary and their overlord Soros.
The idea of free trade was not invented by Trump, it came before him and it will be around long after him.
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In the globalization of manufacturing the only sustainable solution is environmental parity tariffs and labor practice parity tariffs so that China will stop using pollution as a competitive advantage and so that labor practices in China and many other developing nations are improved massively.
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If environment is protected and labor force treated well then american and european manufacturing will be competitive considering the long time that it takes for products to reach markets from China and the cost of cargo.
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Chinese made Iphones should cost extra 100 dollars to take into account the amount of environmental destruction that making of each Iphone causes in China.
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Artificial zero interest rate policies by incompetent central bankers should be stopped because these only create bubbles in real estate which slows family formation and bubbles in stocks which leads to mal-investment like stock buybacks with debt and massive executive bonuses.
Further the low interest money speeds up the investments in automatization and quick automatization that leads to increased unemployment for long periods for local populations is unsustainable socially for western countries.
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Let’s add ‘Someone’s interest expense is my interest income.’ If I earned substantial interest income I would spend it. This spending would aid in economic growth because others would be doing the same thing with me. Since money would cost more, it would be rationed sensibly and used more for projects that actually created jobs as opposed to projects that flipped paper to a greater fool. Low interest rates are deflationary since they remove income from the system, which removes spending, which causes rices to remain low and competitive.
Central banks use ‘deflation’ as a red herring. Low rates and QE directly subsidize government spending for everyday expenses. Central bankers whining about deflation are conducting a Snipe Hunt. They won’t normalize anything until they catch all the runaway snipes and they intent to do whatever it takes to get them all, make no mistake – to borrow a Draghi phrase. The Japanese and BOJ are also master snipe hunters.
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‘rates’ not rices. News year resolution – attempt to proofread.
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oops. ‘prices’, not ‘rices’ or ‘rates’. Not bad poetry though.
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One of the first things I noticed was how well you write. A rather peculiar trait for an accountant.
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wrldtrst,
I’m not a very good accountant. I used to design and program large and small accounting systems as a consultant because I found designing systems preferable over using them. Going for the CPA was an afterthought as I got older. To pass the CPA exam (actually 4 exams) your knowledge base needs to be a mile wide and a foot deep (nailed all 4 on the first try.)
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wrldtrst,
plus, I tool a class in college where they were more than big on being able to competently summarize a crapload or an entire book in one or a few sentences. That class made a big impression on me.
The writing came about because I noticed that some people couldn’t pee their pants if they had to follow instructions, but acted as if they would have no problem doing so if left alone. It became a personal challenge to get them to understand new stuff while being themselves.
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By the way when it comes to globalization the bad deal US postal service has with China postal service has to be stopped.
Currently US postal service is losing money on each package of chinese made stuff posted from China to USA and that is enabling chinese stuff sellers like Alibaba to make huge profits.
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That agreement must be stopped immediately and US postal service has to start charging costs plus profit for each package mailed from China to USA.
Those incompetent people who made that deal should be fired and never allowed to make any kinds of deals,
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Currently chinese stuff is being sold and mailed directly to USA taking away these sales from US based companies because they are unable to compete and leaving states and federal government without tax revenue.
Many european countries have similar deals that lose money for their local postal services and take away profits from local businesses and give those profits to chinese companies which cost the local postal services money for each package delivered so americn and european taxpayers are subsidizing chinese companies because of incompetently negotiated postal office deals where government bureaucrats simply were totally incompetent and could not envision the current kind of mass selling through post as done by chinese companies like Alibaba and tens of other similar chinese marketplaces.
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Mish,
Love reading your blog, have you ever considered doing a debate with Vox Day on the merits of free trade? I feel like that would be an enjoyable dialogue to witness. Have a great night!
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Successful first world countries protect their industries, as the Bairoch study confirmed for the 19th and early 20th centuries. Britain’s free trade policies during this period allowed Germany, France, and the US, which had tariffs, to surge ahead economically. Even if this were not the case, the evisceration of the real economy will wreak cultural havoc, all for the benefit of a tiny portion of the wealthy.
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Trump, his cabinet, and Congress are going to get a very rude awakening in 2017. The US military might eat Spetznaz for breakfast, but they are no match for accountants.
the war against Obamacare and unpayable “promises” will occupy the US government for the next 20 years.
If Obamacare doesn’t get repealed, the US government will look exactly like Italy. Technically there is some guy who is labeled president, and a bunch of other people fighting each other in a legislature — but ultimately no one else in Italy cares. The Italian government is powerless and every Italian knows it.
Everyone in France realized after the Nice truck attack that Paris cannot protect them. Not because ISIS is strong (it is not), but because Paris is weak.
Washington DC might collapse before Berlin. Will the CDU find a suitable alternative to Merkel before Uncle Sam gets Obamacare repealed? Will both countries become failed states?
With no **SOLVENT** “global consumer of last resort”, will China’s mercantile economy implode too? Without someone else willing to go deep into debt, China’s economy is a fish out of water.
The media wants to argue about globalization — obsessing over individual chess pieces like amateurs. Smarter people look at the whole chess board.
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‘NAFTA did not cause a loss of manufacturing jobs’ – This is a bridge too far. Basic economics as well as lots of personal experience provide a great deal of evidence to the contrary. A great many businesses moved manufacturing plants to Mexico, laying off the US manufacturing workers, and moving a great number of support jobs there as well. Economic theory will say that the lower cost of goods will benefit the consumers as a whole but to claim those jobs didn’t move south is completely wrong. The automation and robots didn’t need to me created because it could be moved to Mexico for less money and with less risk. See also China after its full entry into the global trading system.
Make the honest argument that the consumers as a whole benefit but don’t claim manufacturing jobs we not lost. That discredits everything else.
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Free trade doesn’t require a treaty between governments. It requires two parties each making sure they benefit on net from whatever exchange of goods / services.
Globalization and fair trade requires over-paid central planners to negotiate treaties and collect taxes for themselves.
NAFTA, EU and TPP all need lots of bureaucrats to “enforce the treaty”, because the treaty was written by the bureaucrats for the bureaucrats — the treaties are not written by the people who do the work
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Free trade doesn’t require a treaty between governments. It requires two parties each making sure they benefit on net from whatever exchange of goods / services.
Yes!
Trade is between individuals, not natiions
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And when our government constantly tells its people that job loss is good for America and even if not we OWE it to third world countries to bolster THEIR economies, how does free trade work then?
When our government and complicit banks LOAN us the money to buy our foreign made goods that we can no longer buy outright, how does free trade work then?
And when government layers more and more taxes and debt onto the amaican people to sustain wealth redistribution to keep our millions of unemployed consuming, the number growing every day, how does free trade work then?
The ONLY way free trade works is if you have an unmanipulatef balanced economy where every unemployed worker and closed business is reflected INSTANTLY on the balance sheet.
NO cover of debt or money printing. NO robbing Peter to pay Paul. The unemployed person goes immediately to the street to beg. He does not get free money to keep the consumer circuit lit. He becomes an instant symbol and reminder of WHAT our actions have wrought.
It is no accident that we have such incredible debt, unemployment And foreign trade deficit. It is a narcotic supplied at low cost to dull and conceal the pain. We are HIGH on consumption provided by redistribution and debt. If you want to see exactly how high, how addicted, simply remove it for a week.
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very true, but a little on the theoretical side. Government is needed to ensure group A doesn’t take advantage of group B, much as how the police keep the bad guys under control in every town in the US.
Government is needed. Unfortunately, people who like to control others are drawn to it and use it’s coercive powers to manipulate. That will never change. God invented angry mobs to keep Government under control.
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Very true, and free trade takes two to make it free. So, when the other government, such as China, does not do free trade, there is no free trade whatever the US does.
And according to zero-sum game theory, insisting on doing a one-sided free trade will just make you lose everything.
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@mad & @cdr — no amount of bureaucratic bungling was going to fix the problems you mention (the results seem to indicate the bungling made things worse).
Yesteryear, we lost the farm jobs and got buggy whip manufacturing. Then we lost the buggy whip jobs and got car manufacturing and/or textiles.
The problem is the central planners think everything must be kept “as is” — but they can’t keep the buggy whip makers in business.
Net result… the buggy whip business gets destroyed (and there is nothing anyone can do about that), but the NEW industries (and new jobs) are prevented by central planning.
The underwear makers lost their jobs to China, which in turn quickly lost their jobs to Vietnam (and there was nothing Beijing could do about this either). Soon machines will replace the Vietnamese workers, in whatever country doesn’t tax machines.
You can’t save the buggy whip makers (or underwear makers) — neither can Washington DC or Beijing. What you can do is take the skill sets workers had from farming and buggy whip making — and transfer those skills to the next industry.
That is the part that is missing today. We got rid of all the apprenticeship programs. We converted colleges into overpriced political indoctrination camps. Its the standard outcome of central planning: one size fits all legislation.
Central economic planning killed your job — both in the US and in China. Central economic planning also prevented you from transferring your skill sets to the next industry.
NAFTA, TPP and big unions are designed to protect the central planner’s jobs — not yours!
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We all understand change, and we understand it is not always positive. What we should be able to do is be rational about it and understand that destruction is not progress. Change should not be determined by simple technical capacity to change but by society’s ability to adapt to it with minimal collateral damage. What we see today is massive collateral damage and only getting worse. We are encouraging even more automation as a response to increasing labor costs and demand for lower prices due to people’s inability to pay, which in my mind will only exacerbate the problem.
We need a realignment in trade and a reduction in available credit that is used to fund even more disruptive automation. We are borrowing money from future production to fund the destruction of people’s ability to pay for it. How does a massive unemployed, EATING, population handle this debt load? How long will corporations who own ALL means of production, not just limited to factories but the automated devices working within them, continue to produce for our benefit? After all, is the template to be Germany and simply loan the money to their customers to keep them buying? That surely doesn’t seem sustainable.
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@mad — there is nothing rational about expecting a bunch of government bureaucrats, with too many academic credentials and zero real world experience, to fix all the world’s problems.
No one is saying you must buy cheap, low quality cr-p from China. You are free to buy the higher quality stuff made in USA or whatever source YOU prefer. Whether you like hearing it or not, ***YOU*** chose to buy from China. Your neighbors chose to buy from China. Washington DC didn’t force you, nor did Beijing (though they certainly taxed you for it).
What is really unsustainable long term — in the US and in China — is the growth of government and tax exempt entities. A certain amount of government is a necessary evil, but beyond that it is not necessary nor effective. We passed that point many years ago.
Like it or not: you must work your rear end off to support your family PLUS 3-4 bureaucrats PLUS one third of an elderly person (there are now about 3 workers per social security recipient, down from 5-6 not to long ago). In the next few years, as baby boomers attempt to retire, you will have to support at least one, probably two elderly — plus 1-2 illegal immigrants, plus 4-5 bureaucrats (in addition to your own family). You will die trying.
No country can have more people collecting benefits than working — not China, not the Soviet Union, and not the USA. End of discussion. This is a truism, not a political viewpoint. If you think you can support 10-12 parasites as well as your family — you will die trying.
Back when the US economy was growing, grandparents provided “free” child care… the grandparents generally taught the same values as they taught you, and they had a vested personal interest in protecting their progeny’s progeny. Your kids kept the grandparents minds active, and learned that helping the family was helping themselves.
Today you must pay for a state trained “expert” to teach your children about safe spaces, and you must pay another “expert” to entertain your aged parents and a health provider to shove pills into your aged parents. Kids learn politics and racism and reasons why its all the other guy’s fault, and why the government is the answer to every question. Your parents are too drugged out of their minds to know which end is up.
Your paycheck, the child care provider paycheck and the elderly entertainer paycheck all grow about the same as GDP — but there are two of them being paid by one of you. You must run twice as fast just to keep up. On top of this, the health care provider pushing pills into your parents is costing 20-30% more every year — your anger comes from the subconscience realization that you will never be able to keep up with that.
You are going to have to realize that government bureaucrats see you as a cash cow for them to milk. When they do things right, you must pay them more taxes. When they screw up (which is often), its your fault and you must pay more taxes. They will never be accountable for anything.
As long as you depend on bureaucrats for permission to pee, you will never ever be free. Doesn’t matter what any trade agreement says, you are nothing but a cash cow to them.
Learn a trade from an old blue collar guy that forgot more than any bureaucrat ever knew — it will keep his mind sharp, and you will learn useful skills.
Or you can whine about it to a government bureaucrat, pay for the bureaucrat and the old guy — and send your job abroad in a fruitless attempt to pay three wages out of one job.
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NAFTA, like all the other “free trade” agreements, was undoubtedly put together by multinational corporations for their own advantages over labor and natural resources. The politicians are just the puppets they pay to put these trade agreements in place. Politicians are really just cheap whores and the corps keep them in office. It’s the best scam going. These corporations call this “free trade” which makes the peasants happy that they are “free”.
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That’s a nice simple way of putting it. Multiply times 100 and add a united front of major central banks that are motivated by theories that provide justification for their actions – and you have ‘globalism’.
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Either goods cross borders or soldiers do. Take your pick.
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So we are to voluntarily submit or face war? Are immigrants the same as “goods”? Is any soveign nation doomed with only globalism to save us?
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The USA had its fastest growth in the 1800s when import tariffs supplied all federal revenue.
Trump and his trade team know that protectionism will bring back jobs to the USA. Everything we buy here should be made here, no matter how much domestic labor costs. Lincoln knew that, and Trump knows that.
I expect a manufacturing BOOM in the USA when tariffs and other import tax measures take effect.
Trump will change the electorate as working class voters become Republicans in a wave not seen since FDR captured them.
Back in the 1950’s, a union factory worker could keep his wife at home, send his kids to college, have a nice American car, and own his home in Detroit – once one of the world’s richest cities.
You will see, says Trump. I cannot wait!
Make America Great Again.
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The main issues I see here
1: Are other countries complying with similar environmental regulations as we in the USA are?
2: Are other countries treating their workers with some kind of dignity eg. Foxconn?
That’s what I think when people talk about “fair trade”.
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“free trade is basically econ 101” sums it up perfectly. Modern progressive dogma that tells us if we would just surrender, all conflict would be resolved. If humans could abandon their defenses and lay down their arms and still survive, do we not think we would have done so a thousand years ago? Or is it because we have smart phones that everything is different now?
We don’t even have “free trade” within our own borders, where states and municipalities provide every contorted tax and bribe scheme they can imagine to steal businesses from other areas.
Any notion of freedom still requires a consensus set of rules. Rules that somebody has to make and it is silly to think these rules will not pick winners and losers. There can be no doubt that those negotiating our trade deals are either ignorant or deliberate in their benefit to CERTAIN entities to the loss of many others. Our trade deficit had only grown with each new trade deal, while their proponents point out the winners when conveniently ignoring the collateral damage. So much like Hillary pointing out how those poor miners would soon be out of a job so they could be available to so many more wonderful opportunities.
WHERE ARE THESE NEW HIGH PAYING REPLACEMENT JOBS?
Or are we to simply wait long enough to see how great they all are….Like pelosi said, we just have to pass it to see all of its wonderfulness?
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Maybe this is wishful thinking, but doesn’t it make sense that his protectionism rhetoric compares to his “build[ing] a wall” comments? He’s not actually going to build a wall, maybe he really is full of hot air on this trade topic?
Free trade is basic econ 101 material and he’s surrounding himself with experienced people who have witnessed successful careers based on free trade. See Ray Dalio’s commentary on LinkedIn summing past cabinet member years of experience in different areas. Trump’s advisors top the list in years of business experience.
I find the best way to determine someone’s future actions is to evaluate their past decisions. Basic stuff. Trump has profited from the ability to buy the Chinese steel that Hillary mentioned so often. He utilized immigrant labor and clearly sees the value of owning real estate in foreign countries.
Maybe he’ll make some foolish decisions on trade, but it seems like it’s all talk since his past actions and economic logic don’t support his protectionist rhetoric.
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Letting chinese government owned and/or financed chinese steel companies produce steel below production costs aka losing money on every steel beam and then buying that steel to build your skyscraper hotel in vegas more cheaply is a rational choice for the businessman Trump.
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Letting american workers get unemployed and american steel makers go bankrupt while you are president because china is dumping steel is a totally irrational choice while being president because your voters will hate you and history will remember you as a failed president who betrayed his promises.
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I expect Trump to take a hard line towards China in trade otherwise he destroys his credibility completely and creates a negative and the Trump name destroying legacy for himself and his children.
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For the same reason I expect Trump to build a wall (despite amnesty-republican Ryan already saying it will be just a fence and amnesty-republican McDaniel saying that there will not even be a fence but just some drones) IF Trump does not build a wall he will have destroyed his credibility with voters and he will have destroyed the Trump name which is essential for the success of his family and businesses.
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I also expect Trump to deport all up to 2 million illegal immigrants convicted of crimes and belonging in criminal gangs like he has said repeatedly.
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However I am worried Trump will NOT deport all illegal immigrants which means that their wage lowering effect for tens of millions of americans will stay and about 10 million americans that would find jobs if the illegals were removed will stay unemployed.
If Trump does not follow through with his earlier campaign promise of deporting all illegal immigrants millions of americans will feel betrayed and Trump will not get re-elected…
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Nationalism IS protectionism if borders and sovereignty mean anything at all. Free trade as we would imagine it would still require a framework of rules that would also necessarily be subject to enforcement by a globalist organization. As we know, much of the TTP was about the surrender of sovereignty to a globalist trade organization that would be adjudicated by unelected lawyers who could impose sanctions on any country that refused their fate.
Mish believes in something much simpler, simply individuals trading individually, as though international interests will not intervene far removed from our vision and “present” us with preselected choices.
If we understand anything of our modern world, perception has more validity than truth, because truth is seldom exposed to us as an alternative.
Our modern world is built upon a construction of false premises. We are marketed to on every level every day to the point I do not believe we have the slightest idea what it is we truly want or need.
YET, so many see our salvation in freedom of choice….In an artificial world.
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It is the unit labor cost that is the problem with trade. Goods made from cheap labor puts pressure on competitors forced to use expensive labor. Thus free trade would work only to bring unit labor costs down in “developed” countries and raise incomes in others. The end result for laborers in the “developed” countries is lower incomes or unemployment, especially as a result of robotisation or efficiency drives. That situation is “fair” but completely unsalable to any “developed” electorate suffering rising costs of living (thanks to ZIRP bubbles).
The obvious truth that everyone is overlooking is that there are too many people in developed and undeveloped countries able to do “basic” work. This excess supply drives the unit labor cost into the ground.
Handing out degrees from cereal packets to anyone that can hold a pen doesn’t solve the problem either, it just lowers the unit labor cost for “intermediate” work through the same economic rules of supply and demand (while lowering the quality of work/innovation).
Thus I’d argue that as well as peak debt, the human race is at peak production, peak innovation and peak industrialization. It possibly has been for a while, based on the size of its populations. In other words we may already be at peak population!!
Just exactly where should the next generation go to find well-paid full time jobs that give them the income to afford the “stuff” they should buy to perpetuate the infinite growth model if the peak opportunity that comes with peak population is now in steady decline?
The answer appears to be: Everyone just hopes things will work out if we just tweak policy; as if human prosperity along with the rite to produce children was some kind of religious certainty.
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Without a gold standard, free trade doesn’t lead to a more affordable CPI. CPI deflation due to free trade can only exist if there is no wanton printing by bankers. When bankers are printing, bankers are confiscating the gains from free trade.
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While the media has Mish chasing his tail over a trade war that no country can afford to start — the US consumer is fighting (literally) to return hoilday gifts and get cash instead. Fights breaking out in shopping malls in CA, NV, MI, IL, FL, NC, NY, NJ, CT and MA.
Never to miss an opportunity to cost justify the military MWRaPs police departments got from Obama, police responded to fist fights with heavily armed SWAT teams and lots of media coverage.
http://assets.amuniversal.com/057bed90a94a01341711005056a9545d
As an army friend on mine commented, his garrison invaded Tikrit Iraq with less armor and less firepower than Obama is using to invade shopping malls across the US.
For all their SWAT teams and assault weapons the police used — the crazy shoppers were unarmed, fighting with fists.
Obama’s civilized folks in Chicago, which has the strictest gun laws in the country, managed to shoot and kill 61 people and injure hundreds more over the holidays.
Merry xmas indeed.
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…trying to insert the cartoon image not just the link…
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If our trade deficit grows every year for decades, are we not already in a trade war that we simply refuse to acknowledge? Has this not been the mindset preceding every great war, that we deny until it is completely undeniable and under full attack?
If we had refused to provide technology transfer to China, would that have been an act of war? Is saying NO an act of war?
Is it that we have already surrendered most of our ability to fight a trade war as we have given up so much of our manufacturing capacity and created massive debt, that we simply fear an even greater loss? If so, we should be honest with the American people and just tell them to all surrender now to avoid further losses. Of course, no battle was ever won by anyone afraid of taking losses.
It is apparent that a very many have already taken great losses over recent decades, so I can only assume the ones worried about sustaining losses now are the higher ups, the ones who have been profiting so handsomely thus far. They might as well be selling arms to ISIS, or they probably ARE. They don’t care because they are still selling the notion that “what’s good for GM is good for America” crap. Like profligate bankers, we just can’t live without them.
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You already surrendered your ability to think and act for yourself — when you whined and waited for a clueless bureaucrat or academic to fix all your problems for you.
If the bureaucrats and academics knew how to deal with the real world, they wouldn’t be mooching off your paycheck.
I learned more about fixing things around my house from my grandfather (who never finished high school but raised a family) than I learned from every shop class, college course and volunteer organization I ever participated in. Lots of parents and kids brought their broken appliances, bikes, etc to my grandfather (instead of a repair shop) — he fixed them for free, fixed them right the first time, and taught onlookers valuable skills if they listened. Meanwhile, he kept his health and his mind sharp. Win, win, win.
Being handy with tools is a good thing in itself… but if you have an idea for a new product / service, how are you going to mock up that product if you can’t tinker with a prototype? You can’t. You can’t come up with a new recipee buying store bought cakes.
That is missing from “state organized” education. Blue collar workers used to get apprentice training from senior guys — now big unions stifles all work young and old.
Want to learn how to make America great again? Go ask some old guy (or gal). Hearing how they walked to school uphill both ways thru 50ft of snow is silly of course — but the other lessons you will learn along the way are invaluable to both the young and the old.
You won’t learn anything in a government training program except how to pay more taxes.
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Free trade has to have trading partners that agree not to cheat on the rules of free trade, just like a cartel needs to have all cartel members that don’t cheat on the cartel agreement. When does that ever happen?
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Mish, consumer goods prices are not determined by their production cost. You should know that. Prices are determined by supply and demand.
In other words, outsourcing production to China doesn’t lower the price of the product, nor does keeping the production in the US increase its price.
However, it does affect the economics of the business. Some products may simply be not worth making in the US, but I suspect that the number of such products is much lower than what is being outsourced right now.
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Spot on. Supply and demand determine the final price of a product. Sourcing is done for the lowest production cost.
Mish is content to have America become a land where everyone makes $15/hour (except of course for economic bloggers).
Tough to buy $40K automobiles and expensive McMansions on $15/hour……..
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All theory. Reality says that in a free functioning capitalist economy, prices are not arbitrary and are determined by both supply and demand, BUT that supply created a specific profit margin, that when substantial margins immediately attracts more completion which will bring margins into a relatively normalized range. It is COMPETITION that determines price as in a “controlled” economy it is easier to manage than demand. We see today how many monopolies are either created or enabled by governments around the world. Each doing so in the claim that competition would damage the “market” and that government intervention can create more efficiencies that competition. A big fat lie used to enrich a very few.
We know that unrestricted trade with nation’s with vast cheap labor resources as well as unlimited funds to invest in state of the art technology CANNOT be completed with WITHOUT a major rebalancing of labor costs.
America believes we can compete or coexist with places like China by simply importing our own cheap labor bit progressives have destroyed that theme by insisting illegals be provided equal standing with citizens. Unfortunately we see a massive growth in unemployed and underemployed that must be subsidized with ever more debt, taxes and even cheaper consumables. What is the trajectory?
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We need free trade within the US. Trump should do what he can to reduce regulations, especially the FDA. Getting rid of other alphabet soup agencies – CPSC, EPA, SEC, FTC, FCC, ETC – would also help. Sales and income taxes need to be reduced, if not eliminated.
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“Vox Day debated twice and among other things noted you cannot have free trade amid fiat currencies or federal debt or such other distortions.”
Default on all federal debt, collect taxes in Gold, dump all “legal tender” nonsense regulation. By Jan 1st.
Freedom is the only non negotiable. Anything else is just a whole lot of who-cares, championed solely by those bent on infringing on others’ freedoms, and their well indoctrinated sycophant army of useful idiots.
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Freedom is as subjective ad fairness. The important thing here is CONSEQUENCE. Every action and inaction has consequence. Mish lives in an alternate world when he believes we can train 50 year old carpenters to be programmers….When we are importing those from India. We see the damage all around us. Almost a hundred million NOT working. 94 percent of all new jobs in alternate employment…Part time, home work low wage crap.
This notion of “free trade” where we pretend that we will drop our defenses if everyone else will….Is silly. This theme has been destroyed time after time. The unwillingness to defend ones self in ANY arena, has proven fatal. The markets will not be free if an enforcement mechanism is in place. Artificial constraints will not be free. If the Chinese are willing to work for one fifth of a western worker and their employers can purchase the exact same technology, some one (us) will lose.
Who wants a fair fight?
If it is a fight you know you will lose because your opponent is twice as strong, you either surrender, fight to defeat, or arm yourself to level the field. Mish says NO. Just take our lumps.
We can argue about how best to defend ourselves but it is simply more suicidal thoughts based upon theoretical”principles” that have never worked out. History is littered with losers who simply never figured it out.
We live in fear of a trade war that may mean our TV’s double on cost, because we are TOO DAMNED POOR TO BUY AMERICAN.
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Politically speaking, freedom, or perhaps Liberty, is just absence of government coercion. Nothing subjective about it. Reduce Federal and local workforces and budgets to zero, and dump all and any pretense of a government with some sort of exclusive access to means and rights of coercion, and you’ve got Liberty by definition. Then protect it by, literally, living “Give me Liberty or Give Me Death.” Without exceptions.
There may be less harsh arrangements that preserve virtually all freedom, but if not, at least the above is one way.
Consequences will sort themselves out nicely in such a world, as there are literally noone to neither blame nor run to for consequence mitigation. No “We” who are somehow supposed to be forced to at gunpoint “retrain” someone else. Nor any other whining about others owing you anything at all.
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Mish, you’ve been wrong about everything Trump so far. Maybe give him a chance before deciding he’s already a huge failure (before he’s even started)?
#MAGA
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I used to be a “free trader” I no longer am.
“Free Trade” is always advertised as been good for consumers in that it provides for lower priced goods and services (mostly goods) which is of course a good thing if one only considers the costs of those goods to be reflected in the specific price they pay for those goods and services. There is seldom, if ever any thought to costs associated with displaced workers, societal costs, cultural losses and more important than any of those items, lost skills.
Consider that two of the hats we wear in this life are consumer and worker. We have exaggerated the benefits of “Free Trade” to ourselves as consumers and have shrugged off the losses we have suffered as workers.
Finally, when I look at just who exactly it is that is reaping the financial benefit from “Free Trade” in the form of positive cash flow, it becomes pretty easy to come to the conclusion that like most of what is being sold as good for you in these days is pure bullshit designed to enrich established wealth at the little guys expense. You can throw six figure debt for a frequently worthless diploma into that same conversation.
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To summarize: big government already defeated you in your mind. You depend on them to do your thinking for you. Mind numbing debt is not the worst of your problems, a numb mind is
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tz – below the belt and shameful.
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Ironically, Mish’s “free trade” argument works only as long as the impoverished and unemployed and underemployed American consumers are allowed access to cheap money in the form of low interest rates fixed by the Fed i.e. by the continued growth of the debt bubble.
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The current consumption is being held up by increasing debt levels for americans and increasing debt levels for american government.
This fake demand and this fake standard of living both tied to increasing debt levels is NOT a sustainable model.
The change to this model has to be made now before the situation gets out of control.
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Trade wars are a symptom of negative social mood, the same mood that got Trump elected. Trends don’t move in a straight line before they reach their maximum strength. I expect a full-blown global trade war to develop, but I’m not sure if it will be during Trump’s presidency or someone else’s. No single global leader is THE cause of a global trade war; however, history credits them as such because the model for history is a mechanical-causal one.
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Is unemployment and falling living standards a mechanical-causal one?
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Nope
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Get a grip. People act like global trade did not exist until 1990. Remember the crap in the sixties that said made in Japan. Global trade has been going on since Marco Polo. It will go on with Trump regardless of trade wars. You act like we have open trade. Well we don’t. That is why we have trade deals. Will stuff get more expensive, maybe but trade will flow.
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Hah! It’s more like “Will Trump survive Globalism?”
Over the next four years he, Brexit, and any further anti-EU and anti-central bank shenanigan movements WILL be blamed for any crash or major downturn and considering the popular vote in the last US prez election there are plenty more than enough economically clueless people to believe it.
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I read the Eiras article and it makes no sense.
“U.S. manufacturers have two options: either adopt new technologies to cut costs and become more competitive or shift the focus of their operations to different areas in which they can be more competitive.”
Whatever cost-cutting technology we adopt, the Chinese can adopt. Whatever area we try to be competitive in, the Chinese can be more competitive in. There is nothing the U.S. can make that the Chinese cannot make cheaper by their labor advantage. The only way the U.S. can be competitive is for wages to collapse to subsistence levels.
Mish, please give examples of products that we can manufacture more cheaply than the Chinese because I ain’t seeing it.
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Wow that’s gonna be a big list. Transport from China isn’t free. Lots of heavy, awkward construction products will never be made over seas or even more then 300miles from point of use. Precast concrete, concrete block, windows, trusses and more.
Lots of machined products – tooling for packaging, packaging, CNC machined components, medical parts.
Lots of large but not expensive things – kayaks for example.
Apparently solar cells, batteries and Tesla cars are good to be made here.
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Trump is a huge fan of “anchoring” as a negotiating tactic.
When anchoring, one takes an extreme position, sticks to it during negotiation, only to back down at the last minute in favor of a compromise position that favors himself.
Example, reasonable compromise would be $50,000. Anchor at $2,000,000. In final negotiations, back off to $100,000, and end up sounding reasonable.
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We cannot have free trade with countries whose labor and environmental laws are so much weaker than ours unless we r ready to allow for Beijing levels of smog and pollution in our cities and similarly polluted streams and lakes that are found across China.
The Chinese cannot organize as workers and they cannot piston their gov’t to protect their environment and therefore it is a mistake to trade freely with china
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Why Not?
It is to the advantage of US consumers.
Mish
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Mish, how do we have American consumers if they are all unemployed? There seems to be this theory that we will adapt, reeducate, retrain or whatever people who showed very little aptitude to learn in even a formal educational environment such as SCHOOL. Our educational system is producing some real crap…always has, BUT many didn’t need a lot to get by. That is no longer true and to assume that somehow we are going to take these people and train them UP to become a more efficient and higher earning component of our system seems very optimistic.
Lower prices, just as easy credit are masking our problem and to suggest that they are our solution, our GOAL, just seems insane. How long will China subsidize our life style with cheap goods once our competitive forces are dead and gone?
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The problem is the average person cannot do high tech work even with training. More work is emerging requiring above average intelligence while work requiring average intelligence is dwindling. With automation the remaining jobs don’t pay enough to live as America did years ago. Guess what, the standard of living has to fall for a lot of people. The others will eventually see their freebie entitlements dwindle. The gravy train ride for America is doomed to end one day.
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It is NOT to the advantage of US consumers when this consumption is done with increased debt in the individual level and this cheap china made product consumerism is enabled by government getting more and more into debt to pay benefits for the unemployed people whose jobs were destroyed because ultimately the debt is paid by the US consumers.
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Country needs to produce things to earn money to consume.
Country can NOT just consume with debt with continually increasing debt levels.
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Have you not heard of Utopia?
All we need is to believe strongly enough and it will all come true. A leisure and prosperous lifestyle without a care or responsibility in the world.
The perfect world where labor is produced by robot slaves….but are they OUR slaves? Maybe our generous and benevolent benefactor…the government, will claim ownership of these productive assets…in our name of course, graciously providing what we need, when we need it…all for free.
It will be GREAT!
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There’s something missing in this discussion. American importers do not buy in China because Chinese labor costs are lower, but because the manipulated Yuan makes their goods effectively cheaper. The $4 Trillion of aggregate trade surplus between the US and China is a consequence of currency manipulation, not “free trade.”
Chinese workers are not paid in Dollars, but Yuan. As manufacturing has increased in China and it has become a more successful economy, its currency should have climbed against the US Dollar, but the Chinese prevented that by managing the exchange rate (the “trading range” is still completely managed by the Chinese government.
In earlier times this “cheating” by the Chinese would have resulted in barrier tariffs against their goods, but Walmart and GE, and other importers were able to buy off the US government in order to continue their importation subsidized by the Chinese peg.
At the end of the day, manufacturing is the only part of the economy with a real “multiplier,” and no nation has become wealthy without it. The current disaster of outsourcing our manufacturing because the Chinese peg their currency has to be stopped.
And Mish, you’re wrong, support for a manipulated currency driven constant trade deficit is not “free trade,” and you do us no favors by supporting a continuation of this grim gutting of our manufacturing capacity. I speak from the experience of representing dozens of industrial companies which are forced by economics to outsource their manufacturing to China because their peg manipulation crushes their US manufacturing competitors.
John B Goodrich
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Yaun is actually overvalued
If China Floated the yuan it would likely sink
Might even crash id China took off capital controls
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Free Trade? Like the Petro/Dollar? haha
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FREE TRADE = GLOBALISM = ENABLEMENT ACT FOR GLOBAL MONOPOLIES
Look Mish. There are a few of us out here who have a higher IQ then a door knob.
It doesn’t take much to see that the 1/10th of 1% have been at war with the middle classes of the western democracies for at least about 100 years. Everything, and I mean EVERYTHING has been tried and tested in the battle to euthanize the middle classes of these nation states so that the 1/10th of 1% can have their way with them, and seize control of the governments thru the same methods they already used in the 3rd world banana republics over a century ago. And they have.
It would be great to be able to point to the Jews or some other ethnic or religious group as the culprits that must be held accountable. And there are plenty of them mixed up in this cabal. But the club is open to ALL and I mean ALL applicants provided they bring the means and the will to lend assistance to the cause. “JUST WIN BABY” might as well be their battle cry, (lifted from al davis, former owner oakland raiders), regardless of how much damage they inflict.
“There are no more nations, Mr. Beale. Only CORPORATIONS.”
There are more components to the equation of what’s best for the NATION STATE then the simple calculation of how much crap consumers can buy (mostly purchased thru DEBT) then consumer prices for products. There is for one thing, and only a minor thing to you perhaps, but something called SELF DETERMINATION of a society. And when ALL, and I mean ALL the organs of industry and society are MONOPOLIZED of, by and for the 1/10th of 1%, well, you wind up just about where we are today.
Now of course I recognize you might not favor the model of NATION STATES, or the right of self determination, or no taxation without representation, or the idea of ALL men being equal UNDER the law, or that the foundation of a society is the family unit, or that countless blood was sacrificed so as to give us the opportunity to live in a place (not a perfect place for sure) where the government was supposed to be OF, BY, and FOR THE PEOPLE, and to be held accountable when it had become corrupted, etc.
In that case, your argument about FREE TRADE might make some sense.
And you have the balls to hustle for these assholes ?
PUKE TIME.
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It’s Puke Time that you have no idea what I am saying, what free trade is, or how consumers benefit from the lowest prices.
Yes, puke time is correct
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Something like 70 FREAKING percent of the American public has LESS then $1000 of savings to their names. THAT’S IT.
90+ million are out of the work force, living “on the dole”.
Countless millions are up to their eyeballs in debt, paying interest rates that in another time and place would have put the banksters in the slammer, while every time the BANKS get into big trouble, their losses are SOCIALIZED while their profits remain PRIVATE. NONE of the banksters have been indicted, let along prosecuted or convicted since the S&L bullshit since Reagan.
Countless industries have been outsourced to other countries, and the ones that remain are MONOPOLIZED.
CRONY (criminal) capitalism is the system we have today, or perhaps it’s better defined as FASCISM. Think Gotham City and the League of Shadows.
Your “academic theories” are cover for the criminal monopolies which are strangling this country. There is NO “free trade”, or for that matter “free” anything.
EVERYTHING COMES WITH A PRICE TAG.
EVERYTHING.
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The establishment wants people to believe that globalization means global trade, when the facts are they want global control/govt, which of course would be worse for trade.
Trump does not want globalized govt, which scares the globalist to death, and is forcing their desperate hand (i.e. war on cash increasing – https://www.armstrongeconomics.com/markets-by-sector/precious-metals/gold/confiscating-gold-3/, war on free speech increasing with 2017 NDAA signed by Obuma last Fri, etc.).
Trump wants to negotiate trade with individual countries in a manner that is at least equal for both party’s, and for a consumer economy like the US, that means lower net prices, which could be achieved in several ways (i.e. higher wages, higher dollar, lower taxes, etc.).
Trump cannot be as much of an idiot as the inexperienced, ivory tower, political wonks who got us in this mess, and he was certainly a better alternative than any of the other candidates. Since the issue is how far will the establishment go to stop Trump from upsetting their rigged gambit, the better question is, will Trump survive the globalist?
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Globalisation with its comparative advantage theory is a load of bull****. who says that every nation will be better off if they can specialize into particular goods?? take it with grain of salt u folks. What if a nation with superior technology able to specialize into one thing then capitalize into everything, leaving other country no space to specialize at? What if tomorrow neighboring country were to advance their line of products with better production technology? you are either forced to innovate or change your line of product, which unnecessarily destroys wealth.
This theory is backward, created in 1800-ish that should be left where it belongs, the colonization era.
BTW, that is true that you mentioned the technological advancements won’t bring jobs back since imbalance between supply and demand will still remains no matter what a Trump does (unless somehow everyone come into a consensus to limit working hours, or other good ideas). But perhaps he recognize this and try to win in competitive side of things by having lower corporate tax relative to other nations, so at least some of the supply is connected to USA
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Globalization is a huge winner
100% for certain
It is govt interference in globalization and central banks insistence of a 2% rate of inflation, improperly measured that is the problem
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