O ye economists: what would happen if we put a 100% tariff on imports?

[XemaSab]

:shrug:

[Redstone]

1. Same thing that happened last time we did it. Do the names Hawley and Smoot

ring any bells for you?

Redstone

[Elwood P Dowd]

7. Smoot-Hawley didn't cause The Great Depression

and anybody that says it did is a republican propaganda tool for the corporate fake free trade crowd.
Smoot-Hawley didn't take effect until 1931, and we were already in the middle of Wall Street crashes, thousands of banks failing, and economic meltdown before that little obscure deal took effect. The Smoot-Hawley caused the depression sound bite is fucking ridiculous.

[XemaSab]

12. Can't say they do

:shrug:

[whistle]

2. It would make imported luxury cars twice as expensive and the rich

...would go back to buying American made luxury cars, remember like in the late 1940s, 1950s and 1960s.

[Redstone]

13. And ONLY the rich would be able to afford a computer. You'd like that?

Redstone

[Redstone]

16. Oh, and also, the non-rich wouldn't be able to buy an inexpensive, reliable car like

a Civic or a Corolla...

Redstone

[AdHocSolver]

51. Corollas are manufactured in California, Camrys in Kentucky and Honda and Nissan make cars in the US

The added cost of US production does not raise the price to the consumer by much because the manufacturers do NOT give you a reduction in price comparable to their reduced labor costs when they manufacture it overseas. They merely pass along the savings in labor costs to their executives in the form of bonuses and perks.

A short while ago I bought some socks at a store priced at $3.99 a package. The label said made in the USA. So I grabbed a second package, same price, same socks (same UPC) but noticed that the label said made in China. By your reasoning, the second package should have been priced at 49 cents. I put the second package back.

I remember reading a few years ago an article that explained that a Nike shoe that cost $80.00 to $90.00 dollars to purchase in the US cost $3.00 to manufacture in Asia. Anyone who thinks that the stuff we buy is cheaper because it is manufactured overseas is credulous.

[Elwood P Dowd]

22. Building it in the USA would add maybe $200.00 to the cost

of your typical $1,000 computer. I hear this same crap about a head of lettuce costing $25.00 if Americans were the ones picking it. Total bullshit!

The reason for building it offshore is so CEOs and wealthy investors can get filthy rich and avoid environmental, consumer, and labor laws. It's a scam, and YOU support it!

[Redstone]

27. Yes, I support it. We own two Volvos, both built in Evil Belgium. Shame on me.

Also: Add $200.00 to the price of a $1,000.00 computer, and see how many people at DU bitch and whine and moan about how expensive computers have gotten, and how Only The Rich People can afford them.

Redstone

[Cessna Invesco Palin]

39. Where are you getting that $200 figure from?

I suppose we ought to first define what you mean by "building" a computer.

And now let's go through what's in a computer:

Power supply: This would probably be the most cost-efficient thing to build in the US, but then it doesn't make up a huge amount of the price.

What about the CPU? I don't think there's more than a handful of chip foundries in North America big enough to mass produce silicon in the quantities needed for commercial computer production any more.

Then you've got motherboard assembly. Again, I don't think you're gonna find any SMT houses that can come anywhere close to what you get in Asia. From some of the boutique stuff I've used I'd hazard a guess of 75% - 150% more expense for the motherboard to have it manufactured in the US. That's a direct comparison based on some work I've done, having the same board manufactured in China and the US some years ago.

Hard disks? Forget it. You're not even talking about building hard disks in the US. You'd need to build a factory to build your hard disks. It's all done in Thailand now.

All of this manufacturing moved over there for one gigantic reason: The cost of labor is much lower. That's the long and short of it. It has nothing to do with avoiding environmental or labor regulations per se. It's just that China offers a much better deal all around. It's about saving money on production and increasing profit.

This may also come as some surprise to you, but most Chinese electronics manufacturers aren't sweatshops. I wouldn't wanna work there, but it's far in advance of anything we had in the US at a comparable point in our industrial development.

[AdHocSolver]

69. A major part of a computer's cost is the software. Therefore, ...

we could build computers here and keep the overall cost comparable by loading the computers with open source software such as Linux, Open Office, Mozilla, Opera, etc. Open Source software can save you hundreds of dollars and works much better than similar proprietary software. Whether you use it for one computer or 10,000 computers, the cost of the software is the same. It is free if you know how to download it and install it yourself -- A few bucks if you pay someone to do it for you.

So, a knowledgeable person might spend a few dollars extra for hardware and save hundreds of dollars on quality software.

The manufacture of electronic parts costs a lot less in mass production than what you pay for individual components. The production of these parts is largely automated. Once the production machinery is set up, the operation is done by computers. The price you pay retail is considerably more than the manufacturing costs, even when it comes from China.

Final assembly of a computer is the only labor intensive part. I have bought computers from a local shop that cost only a few dollars more than I would pay for a comparable imported box at Circuit City or Best Buy. For that few dollars more, I know I can get warranty service or excellent free advice that the chain stores do NOT provide.

[mrreowwr_kittty]

84. You are so right. Funny how quickly people forget how the market works

Prices of things are determined by demand, and what people are willing to pay for them. If prices for things like computers or lettuce get too high, people buy less of them or find alternatives. Then the prices come down.

And this idea that paying people more will lead to higher prices is simply ridiculous. If that were true, the price of EVERYTHING would be a fraction of what it used to be. Consumer goods are made by outsourced workers who make pennies and homes are being built by non-union laborers (many of whom are illegal immigrants). Yet, did the price of a pair of Nike tennis shoes go down? Last I checked they're over $100 a pair retail. Did the cost of new homes go down in the past 2 decades, as well-paid and skilled trade workers were replaced by people who could crank out cookie cutter McMansions at a fraction of the pay? Up until the recent housing bubble burst, not hardly. Home prices are really illustrative of how full of shit the plutocrats are when they start whinging about having to pay workers and treat them decently.

[tritsofme]

20. I didn't realize we only imported luxury cars into this country.

I must be an idiot.

[tammywammy]

21. Holy Crap!

My VW Beetle is a luxury car. Thank you for letting me know.

[Redstone]

28. Holy Crap!

There are RATIONAL people in this thread! (You're not the only one; there are several others.)

Sometimes the bitterness and irrationality about "rich people" around here gets to be annoying. We've had people accuse anyone who stays overnight in a hotel of being some kind of Capitalist Oppressor. Really.

Redstone

[Elwood P Dowd]

31. Delete

.

[Redstone]

34. Ha! You exposed me for what I reall am! I'm a Republican! And a fake! Whatever SHALL I do

now? I'm going to panic, because you've revealed my Secret Identity to DU!

Redstone

[Elwood P Dowd]

37. Anybody that supports this insanity can only be a republican or

on the corporate take such as most of the DLC members. We are running an 800 billion dollars a year current account deficit, and YOU support it. We have shipped tens of millions of middle class jobs out of the country, and YOU support it. Real wages are falling for median income workers, and YOU support it.

[Redstone]

40. Say, where was the computer you're using made? So YOU "support it" too, don't you?

Man, you've done some heavy shopping at the Sanctimony Store lately, haven't you?

Redstone

[AdHocSolver]

83. That is a totally ridiculous snide question.

I always check labels when I shop. It is almost impossible to find any goods made in the USA anymore. The retailers do not offer it for sale. We cannot buy what is NOT available. We are not given a choice to buy "foreign" or buy "American". The retailers have taken that freedom away from us. The manufacturers and retailers tell us that we buy whatever crap they foist on us or we do without.

That is NO choice. In the good old days, when I was given the choice, I almost always bought American. One reason was that the quality was usually better than what is imported. A lot of what is imported today is cheaper, not because of lower labor costs, but because the QUALITY is poorer.

I have always decided what I would buy based on the quality of a product. I check out the materials, workmanship, estimate how long I think the product will last without needing repair or replacement. Then I buy the best product that I can afford. So much of the imported products are shoddy crap that it is getting more and more difficult to find what to buy at any price. Even many high-priced items are crap.

The only imported products I willingly buy (when I am in the market, which is rarely) are Japanese branded cars. They are better designed, better built (my car was manufactured in the USA), and give better mileage and more satisfaction.

[Cessna Invesco Palin]

41. I see you're an Apple fan.

Q: How much of Apple's shit is made in the far east these days?

A: All of it.

[Redstone]

45. How much of YOUR computer was made in America? PS: I think you're attacking

the wrong guy; I'm NOT the one who said it would only cost $200 more to build a computer in America.

Redstone

[Cessna Invesco Palin]

47. None of it, I'm sure.

That's the point. I suspect a lot of Mac-heads don't realise that their computers are made in the same damned plants in China as everyone else's.

[Redstone]

52. The fuck makes you think I'm a "Mac-head?" It's stupid to make assumptions about people

you don't know. I use Macs because I'm in the publishing business. If another company made computers that served my needs better, I'd buy from them.

You don't know jack shit about me, so maybe you should stop making blind assumptions. it maes you seem ignorant.

Redstone

[Cessna Invesco Palin]

55. You need to calm the hell down.

If you will refer to the post in question (#41) you will see that I was responding to our good friend Elwood here, not to you.

[Redstone]

65. Thank you. I think I was irritated by the holier-than-thou posts from "our good friend."

Sorry about that.

Redstone

[Elwood P Dowd]

46. And if our politicians had never forced these fake free trade deals upon us

the Apple products would be made in the USA like the old days. Almost every consumer electronics company based here is moving production overseas. You want to compete and pay your investors a decent return, then you are forced to do what the competition does. It's a race to the bottom for workers and heaven on earth for wealthy investors.

[Cessna Invesco Palin]

50. What trade deal specifically?

American electronics manufacturing has been moving to the far east for as long as the far east has been able to meet the quality and technology requirements for producing the goods. There isn't some secret trade agreement boogeyman responsible for this. It's simple economics.

[Elwood P Dowd]

58. NAFTA, GATT, WTO, CAFTA, and many more.

We allow our trading partners to keep higher tariffs for 15-20 years, while we lower ours almost immediately. We allow them to charge a VAT of up to 30% (more in some countries), while we have no VAT. I've been in the consumer electronics business for 30 years. If I ship a product to China that sells for $1,000.00 in the USA, it will cost almost $2,000.00 in China. If that product was exported from China to the USA, there would be less than $50.00 in tariffs and ZERO VAT. Not to mention that the workers who manufacture the product make 50 cents an hour in China, while USA workers making the same product make $20.00 and hour. You support slave labor and unfair trade deals. If you support the lack of labor protections, environmental protections, and consumer protections so we can import cheap stuff, then so be it. We don't agree.

[Cessna Invesco Palin]

61. I would hardly call what goes on in most Chinese electronics...

...factories "slave labor." You are, however, correct on the environmental issues. But then maybe my employer is just particularly scrupulous in picking its vendors. As for "supporting" it, I hardly see how I support it any more than you. You buy and use the same products I do. At least I'm not a hypocrite about it. It'd be pretty silly of me to sit here, as you are, typing on a Chinese made computer, accusing other people typing on their Chinese made computers of "supporting" it just because they don't engage in the same hand-wringing you do.

[AdHocSolver]

88. Au contraire, mon ami! Simple economics would say manufacture as much as you can locally.

A country's wealth is determined by its ability to manufacture goods. This is how Japan, which has no appreciable natural resources, became a wealthy powerhouse and has such a high standard of living. Jobs, jobs, jobs. Export, export, export. Sell more than you buy. Be a creditor nation, not a debtor nation.

The nation that manufactures most of what it needs, and can make enough goods to sell to other countries, has a strong economy and will become wealthy. The "underdeveloped" countries are poor, not only because they have little to export, but they do not make enough to satisfy their own needs, and so have go into debt to be able to import goods that they cannot make for themselves.

Look at Iraq. Sitting on a huge mound of oil, yet their infrastructure was destroyed during the invasion and from the US-imposed embargo. Bush/Cheney has prevented the infrastructure from being rebuilt which is why they are still fighting the US and their country is impoverished.

This can explain the poverty in the African and Latin American banana republics as well. No local manufactured goods to sell to pay for imports so they go into debt.

The same trade and financial agreements such as NAFTA, WTO, IMF, etc. which have impoverished those banana republics with unpayable debt are being used to pillage and impoverish the US today. There are no "secret" trade agreements. The multinational corporations are quite open about how they are looting and impoverishing this country. They have merely convinced people like you, who don't know what they are talking about, to defend their right to screw this country.

Rewriting trade agreements, rewriting the US tax code, and imposing appropriately structured tariffs are exactly what is needed to stop the impoverishment of America. The corporate elite were not called "robber barons" for nothing. That is exactly what they are. If this country does not wake up soon, we are headed for economic collapse. And, it will be world wide like the 1930's depression.

[XemaSab]

44. The real proletariat sleep under bridges

:patriot:

[Elwood P Dowd]

33. A republican fake free trade worshiper just called you "rational".

You hear nothing from this supporter about the lax labor, consumer, or environmental standards from the country of origin for most of our imports. Your hear nothing from this fake free trade supporter about the 30% VAT these countries charge for USA imports. You hear nothing about the shoddy construction and reliability. No, it's only free trade at all costs. Sounds just like George W. Bush.

[Redstone]

35. I'll say it again: Oh, no! You exposed me for what I really am! I'm a Republican! And a

fake! Whatever SHALL I do now? I'm going to panic, because you've revealed my Secret Identity to DU!

On edit: Yes, I also bow down to the Gods of Free Trade in my daily worship ceremony. I can't hide it anymore.

Redstone

[tammywammy]

97. And so?

I had a rational reply to the previous poster. They said no more luxury cars. I drive an import, VW Beetle, hardly a "luxury" vehicle.

[Cessna Invesco Palin]

3. The WTO would launch an amphibious invasion...

...followed by a short war for air superiority over Manhattan, followed by WTO shock troops parading Michael Bloomberg's head on a pike down Wall Street.

[avenger64]

4. I don't think the Wall Street tycoons would let that stand ....

... since they're making money shipping all the jobs off to China. The chairman of Goldman Sachs would probably invoke the
25th amendment and have the president removed.

[LiberalFighter]

8. Bomb the hell out of Wall Street

[avenger64]

9. It's been ....

... http://en.wikipedia.org/wiki/Wall_Street_bombing">done. Those guys keep coming back like cockroaches.

[sam sarrha]

5. even less than 20% and it would pay for voc training and free college like it used to before reagan

[canetoad]

6. What would happen

to the FTA's so lovingly crafted to benefit the USA?

[Elwood P Dowd]

10. Don't you mean.....

certain USA corporations and political donors?

[scarletwoman]

11. Gee. Would that mean we might have to make stuff HERE again? (nt)

[XemaSab]

14. God forbid. n/t

[pitohui]

15. we already have, it's called the soft dollar policy

been to the grocery store lately? remember that piece of cheese that was $3 in the clinton era and now it's $11?

we do have a very effective tariff on imports from europe, it's our destroyed dollar

the wealthy are apparently not happy to be wealthy if a middle class person can also eat fine cheese and drink champagne, they are only happy if they can eat and drink their fine foods while we are miserable

that's what happens

there is increasingly little that a person can buy except necessities and if one of the necessities is health care we can't even buy that

[Redstone]

26. I'm suprised to hear you say this:

"the wealthy are apparently not happy to be wealthy if a middle class person can also eat fine cheese and drink champagne, they are only happy if they can eat and drink their fine foods while we are miserable"

I have more repsect for your intelligence, as you've demonstrated by your many insightful posts (and you know I truly mean that), to posit that "the wealthy" (whoever they are) got together at some (it would have to be a large) meeting at some time or other, and all voted "yes" when one of "the wealthy" stood up and said "The middle classes must NOT be allowed to eat fine cheese anymore, and we must do something about it!"

Truth: Cheese got expensive (in no small part) because corn has gotten expensive. Corn has gotten expensive (in no small part) because so much of it is being diverted from the food supply to make ethanol fuel.

Redstone

[AdHocSolver]

29. Let them eat cake! n/t

[pitohui]

32. oh come on, bush announced this policy years ago, think back

bush said when he first got into office that there would be a soft dollar policy, this is the only policy i can think of that he put into effect, that actually worked

i know 2001 was a long time ago but it wasn't THAT long ago

what is the purpose, this time of century, when people are dying every day for lack of medicine or medical care, to pretend there is not class warfare? when pensions have been looted from people too old to go back and get more of those dollars?

i should not have to write a term paper every time the subject is raised, it isn't me who is playing stupid and acting like they have no idea there's a war on the middle class and the value of our dollar

i'm afraid i don't see the desirability of having factories full of peasants working for a wage that is competitive with china, but this is what the soft dollar was intended to do and they weren't shy about saying that this is what it was intended to do

we should NEVER have been competing on a level of "we can provide cheap hungry labor too" but that's exactly what it is and anybody paying attention knows it

sheesh

it gets old being scolded every time i'm even a LITTLE bit honest

as for the cheese and whine, what can i say, it should have been obvious this was hyperbole, sometimes i despair for the human race, think people before you scold people for your own failures in reading comprehension -- but in fact, just so you'll know, european cheese got so expensive because of the falling dollar versus the rising euro, this isn't any closely held secret, cheap kraft cheese is still $2 a bag so bad cheese i guess comes from the cows who don't eat? er, don't think so

[Redstone]

38. That's not what I said.

Redstone

[dysfunctional press]

17. ww 3.

the wto don't take no shit like that from nobody.

[ShaneGR]

18. Simple answer to this one, we would be unable to import or export goods....

The WTO would impose massive sanctions, the stock market would plunge, and we'd spiral into either a heavy recession or even depression.

[Redstone]

19. Oh, you think you're going to be able to sell that idea HERE? You can't! It is WAY

too rational, too based on the facts, and has NOWHERE HEAR enough bitterness about "rich people."

Hope you have your Nomex suit on.

Redstone

[Greyhound]

60. You do know that the WTO is not really a "world" organization, right?

If the US were to withdraw from it, it would cease to exist. It is nothing but a front for, mostly American, corporations to steal natural resources from poorer nations and to prop up an international oligarchy.

The OP regarding tariffs is too simplistic, but the basic idea is commendable. We have seen the results of the "global economy" as created by the plunderers and what they expect us to suffer.

[bicentennial_baby]

23. We don't have the industrial structure to support it...

Much like Import Substitution Strategy does not work in developing countries, we don't have the infant industries to support it. Plus, protectionism has its downsides, such as tariff jumping firms entering the country to circumvent the tariffs. Also, such protectionism protects skill intensive and capital intensive sectors, but does not protect labor intensive sectors.

[XemaSab]

48. But we used to have the infrastucture

even 30 years ago...

Can't we just dust off the old machinery? :shrug:

[scarletwoman]

54. Amazing isn't it? We used to build our own factories to make our own stuff.

Heck, we built factories from scratch! Using nothing but our own labor and our own raw materials! It was like we had all these resources right here! And we had all these workers right here!

What a crazy system, huh?

sw

[AdHocSolver]

93. What economics book did you get this stuff out of?

"Import Substitution Strategy", "infant industries", "tariff jumping firms." The academics have come up with some really meaningless gobbledegook since I studied economics.

China and Japan have protective policies, and they certainly do not qualify as developing countries with "infant industries".

Toyota, Honda, Nissan, and Mazda must be "tariff jumping firms" as they all assemble cars in the US. They provide jobs for Americans, even labor intensive jobs, the Americans pay taxes, they buy houses, and maybe even buy other American-made goods, if they can find any in the stores.

Sounds like a winner to me.

[tritsofme]

24. Why stop at 100%? Since were on such a role, lets make it a 10,000% tariff!

I'm sure that no other nations would retaliate by slapping crazy and unreasonable tariffs on all of our goods and services abroad.

I was going to type out a long winded response on why this is just a stupid idea, but I decided my time would be spent better elsewhere.

[XemaSab]

49. I admit, I'm playing devil's advocate a bit in the OP

but what goods do we export? Seriesly? :shrug:

[scarletwoman]

56. "...what goods do we export?" Guns, bombs and weapons systems. Lots of 'em. (nt)

[Le Taz Hot]

105. Produce.

It's California's biggest earner (not counting pot).

[XemaSab]

106. Pot's a crop too

:smoke:

How much do we export though? :shrug:

[Le Taz Hot]

115. Yeah, but we're not supposed

to acknowledge that one. Off the record it's our largest cash crop; however, my guess is that very little of our pot makes it out of California being the stone-heads that we tend to be (and proud of it I might add).

[Hippo_Tron]

107. Services and lots of them

But we're having a good deal of trouble getting other countries to lower their protection barriers on services because the US continues to protect agriculture and starve third world farmers in the process.

[AdHocSolver]

95. Actually, China and Japan, as well as other countries, have imposed tariffs on US goods.

These tariffs are maintained and enforced by the WTO and similar trade groups at the behest of the US multinational corporations.

Why would US companies agree to these tariffs? They want to eliminate manufacturing in the US. Why do they want to eliminate manufacturing in the US? Because the US still has environmental and labor laws. Even though they have not been enforced under Bush/Cheney, some of the states still enforce these laws. Moreover, with most jobs overseas, you have a large pool of desperate workers competing for ever fewer jobs. They will work for less money, and you can eliminate benefits. Desperate workers are less likely to complain about mistreatment and toxic working conditions. (Compare this with the situation for illegal immigrant workers.)

Even if China put high tariffs on our goods in retaliation, it wouldn't matter as we have big enough markets to support industry within the US. Before our corporations abandoned manufacturing in the US, we imported practically nothing from China, and we had trade surpluses and the strongest economy on the planet.

[tammywammy]

25. I'd lose my job

:shrug:

I work at a Volkswagen dealership.

[Redstone]

30. You Capitalis Tool, you! Don't you realize that you're Oppressing Middle-Class

Americans by selling those Luxury Imported Cars, like that VW Rabbit to the Rich Bastards for...

about $15,000.00?

Oops. Never mind.

Redstone

(I don't use "smilies," in part because anyone who doesn't recognize sarcasm when they see it is not someone I want to have a discussion with.)

[scarletwoman]

36. You know, I'm old enough to remember the plentitude of VWs sold in the U.S. WHILE

we still had tariffs on all kinds of imported goods.

VWs were apparently affordable, too, since they were highly favored by college students and dirty hippies.

[Cessna Invesco Palin]

43. The US has had a low tariff policy since WWII.

And I believe you will find that Detroit in particular was screaming for more protection in the 1970s. So no, the import duty on microbuses wasn't excessive.

[tammywammy]

98. VWs can be cheaper vehicles

But increase the tariff to 100% then the price point would go up making them much less affordable. Less affordable, less people buying vehicles, there won't be a need for a full time accounts receivable clerk.

[Redstone]

42. OK, rise up, people, and TAKE A STAND! Put your money where your mouth is, and

throw away the foreign-made computer you're using to post on DU!

And put your principles and outrage into action, and REFUSE to buy another computer until you can buy one made right here in the Good Old USA!

....Anyone?

(Say, those crickets are chirping pretty loud tonight, aren't they?)

Redstone

[XemaSab]

53. Hey Redstone

My point is that we don't make shit here, because it's cheaper to buy shit from overseas. Why? They pay people 11 cents a day and dump all the waste in the rivers, which we simply don't allow.

Maybe if shit from overseas was more expensive, it would be economical to make shit here, while protecting workers and the environment. :shrug:

[Cessna Invesco Palin]

57. Well, no.

Because (assuming the WTO didn't exist, which it does) everyone would simply impose a 100% duty on all of our goods, which wouldn't do a great deal for our economy, you know.

[Elwood P Dowd]

62. They're getting close to 100% now in some countries.

Between tariffs and the VAT, some of the stuff I've exported in the past year had ALMOST 100% total fucking duty!!! Come on people, don't you realize what the fuck is happening! Damn!!!!!

[Cessna Invesco Palin]

64. In most developed countries with VAT that I know of...

...VAT is applied to all products, not just imports.

[Elwood P Dowd]

68. Not only is there a VAT on imports,

the governments give the corps a kickback on exports to the USA. It's a double whammy!!! We have no VAT on imports, and most of our tariffs are minuscule. Anybody that defends the status quo is totally uninformed when it comes to trade deals.

[Redstone]

59. Which means that my post above was not aimed at you. You're saying something that,

although hard to make happen (but see* below), would be a good goal...and you're stating it rationally.

My post was intended for the people in this thread who see a Rich Bastard (or cabal of same) behind every problem they in particular or the country in general has, and are happy to bitch and complain and accuse, but won't take an actual stand in support of their beliefs..because when you ask them to, they play the Helpless Cog In The Machine card yet again.

*Here's the asterisk comment: How come Asian companies can make good cars at factories in the US, but American companies can't? And did you know that there was about a ten-year period when there were NO television sets being manufactured in America? But some Asian companies figured out how to make TVs in America, so now hundreds of thousands of them are made here very year.

On edit: European companies are manufacturing cars and electronics in the US, too.

I'd be interested in hearing your ideas regarding the * paragraph. And I'm not being sarcastic.

Redstone

[Elwood P Dowd]

63. And all these foreign companies are practicing transfer pricing

and getting massive tax breaks from local and state governments. It's not what it appears.

[Redstone]

66. Yeah, yeah, yeah. There's just NO satisfying some people. If it's made somewhere else,

it's bad, and if it's made in America, it's STILL bad.

I give up.

Redstone

[Elwood P Dowd]

70. NO, it's about fair trade

not trade rigged by corporate-controlled tribunals such as the WTO. I notice you never mention the absurd amounts of money the corporate guys are raking in on these fake free trade deals. All the while, real rages for median income workers and the working poor are falling. Do you really think David Ricardo would call NAFTA or CAFTA "free trade"? I don't think so.

[Redstone]

74. Whoever the fuck David Ricardo is, not that I care.

Redstone

[Elwood P Dowd]

75. Now I know.

Thanks for your lack of knowledge.

[Redstone]

77. You're welcome. By the way, thanks for keeping this thread going with your

accusations, name-calling, and general stubborn hostility; it's given me the chance to have some real, rational discussions with some real, rational people about the subject at hand.

PS: Next time I buy a car, it's going to be another Volvo. Made in either Sweden or Belgium. Just thought you'd be comforted by knowing that.

Redstone

[bicentennial_baby]

76. Er, one of the founding father of Economics and a genius,

afaik. Capitalism as espoused by Ricardo, Marx, and Smith is not what we have now. Modern day capitalism is *not* capitalism. It's capitalism marred by protectionism, cronyism, and corruption. This is NOT how they originally envisioned how it would work. There is no such thing as perfect competition, which free markets theoretically rely on, in this day and age. And Ricardo knew his shit, just sayin'. It just doesn't apply to this system.

[Redstone]

78. Hey.

Why you up this late, cher?

Redstone

[bicentennial_baby]

80. 'Cause I'm on winter break, and there's Econ threads in GD, and

I'm texting with a long-lost friend. :D

:hug:

But I stand by what I said. :P

[Redstone]

81. I'm not arguing your point. But whatever you call it, it's what we have. I'm sorry I fed an

obsessive in this thread, because that's not a nice thing to do.

I'm not arguing YOUR points at all.

Redstone

[bicentennial_baby]

82. No worries babe, I'm just protective of classical economic theory

which has damn nothing to do with 2007. That's all.

:loveya:

[bicentennial_baby]

79. Ricardo and Smith simultaneously roll in their graves...

seriously. x(

This ain't "Capitalism", no way, no how.

[XemaSab]

67. Seriously?

I think the Asians have a very different idea about WORK than we do.

Here are my suspicions:

I think when a Japanese man (or woman) works on something, it's a matter of personal integrity in a way that just isn't the case for American workers, and it's true all the way up and down the line. When a Japanese engineer designs say, a TV, they want it to be the BEST GODDAMNED TV EVER, and when that TV goes to the factory to get made, part of the idea of making it THE BEST GODDAMNED TV EVER involves the production part of the process, so the element of human error is removed. I also would guess that there's an element of education there, where Japanese aren't willing to hire someone with an 8th grade education to work for them, but American factory owners are. Someone with some community college might be overqualified to rivet all day, but they also might bring some workmanship to the job that someone with less education might not.

But these are just guesses.

What do you think?

Oh, and also I don't think we can make cheap crap in this country that's any crappier than half the shit we're importing. :shrug:

[Redstone]

72. Yes, seriously. And I believe your "guesses" are pretty damn accurate, although

you'll have a hard time getting some of the people in this thread (and probably on DU in general) to agree with them; you'd be accused of "elitism" or something like that.

And the part about "I don't think we can make cheap crap in this country that's any crappier than half the shit we're importing?"

I agree...but only if that's a goal for us. And it WOULD be a goal for us, as long as most Americans continue to be selfish and CHEAP. Not ONE of the sanctimonious ravers in this thread is innocent of wanting everything they buy to be cheap, Cheap, CHEAP.

Until Americans are willing to stop being so fucking spoiled and selfish, this situation will never change. They'll buy a new TV (a cheap one made in China), just because it has the latest features and doesn't cost much money. Mrs R and I are fortunate enough that we could afford to buy a new TV anytime we had the notion to, but we just bought our first new one in 16 years because the old one stopped working. How many Americans do that?

Instead of the old days, when each house had one television and maybe two telephones, now every American household has to have a TV for each family member, plus a cellphone for each, a computer for each, an iPod for each, and on and on.

But then those Americans who bitch about the stuff that they DEMAND be cheap, because they want ALL of it, has to be made oversease so it can be CHEAP, like they want it to be.

That's what I think.

I'd like to see more products made in American. My livelihood depends on American manufacturing. But until enough Americans understand that THEY have caused the problem, and are willing to do without, or cut back on their expectations of entitlement, nothing will change.

And I think that you, in particular, know that. Some others? Maybe not so.

Redstone

[XemaSab]

102. I think you're spot on

but I've got two responses: one is that it seems like there's little expectation of quality. The other thought is that if there was a strong working class, then they could afford to spend a bit more for quality.

We obviously need a redefinition of standard of living, but that's a topic for another thread. :)

[AdHocSolver]

96. I worked for a Japanese company, and I can tell you the simple reason why their products are better.

It has nothing to do with the quality of labor. My current Japanese branded car was made in the USA and is every bit as good as my previous Japanese branded car that was made in Japan.

It has EVERYTHING to do with the QUALITY of MANAGEMENT. Years ago, I worked as a repair technician for a large Japanese electronics manufacturer. My boss had an MBA and I assumed when I started working there that he was not up on the technology, because most places that I had worked previously, the bosses were "bean counters" with business degrees. I learned eventually that my Japanese boss also had an engineering degree. In fact, it was the policy of the Japanese companies to send their best technical people to business college after they had worked in a technical capacity and proven themselves competent.

The only American company where I found the same situation was when I worked for a local branch of Hewlett-Packard. My boss who ran the place had an engineering degree and was very competent.

I found this to be true later on when I worked as a computer programmer. Except for one manager who was a computer whiz, almost every other boss I had was a "bean counter" and ranged from technically mediocre to downright stupid.

The quality of the work is directly related to the intelligence and competence of management. Good bosses recognize and reward good work, and they recognize, and will not tolerate, shoddy work. Period.

[XemaSab]

100. That's sort of what I was getting at

An American company would see the boss with an engineering degree as being overeducated, while for the Japanese, the concept of "overeducated" doesn't seem to exist.

Thanks for the response.

[TreasonousBastard]

71. Most of the stuff we buy would cost 100% more...

because so much is made overseas. Even "American made" goods often use imported components.

And, we would lose most of well over a trillion dollars in exports when the rest of the world retaliated:

This is the html version of the file http://www.commerce.gov/NewsRoom/PressReleases_FactSheets/PROD01_002835.

G o o g l e automatically generates html versions of documents as we crawl the web.
To link to or bookmark this page, use the following url: http://www.google.com/search?q=cache:HTP0L7C38GUJ:www.commerce.gov/NewsRoom/PressReleases_FactSheets/PROD01_002835+us+exports&hl=en&ct=clnk&cd=8&gl=us&client=opera

Google is neither affiliated with the authors of this page nor responsible for its content.
These search terms have been highlighted: us exports


Page 1

U.S. EXPORTS FACT SHEET

February 13, 2007

EXPORT OVERVIEW

In 2006 U.S. exports grew by 12.7 percent over 2005 to $1.4 trillion, while imports increased 10.5
percent to $2.2 trillion. To compare, in 2005 Japan’s GDP was $4.91 trillion and Russia’s GDP
was $733 billion.

Exports comprised 11.1 percent of U.S. GDP in 2006, the highest ever in dollar terms. It was 5.2
percent 50 years ago and 9.6 in 2002.

Although petroleum imports reached a record high of $303 billion in 2006, the rate of growth
declined by nearly half, slowing from 39.6 percent in 2005 to 20.1 percent in 2006. Excluding
petroleum products, the U.S. goods trade deficit grew by only 1.7 percent ($8.9 billion) in 2006.
International travel is one of the largest exports for the United States, ranking ahead of agricultural
goods and motor vehicles. Purchases of services and goods by foreign travelers, including
expenditures for food, lodging, recreations, and gifts while in the U.S. are counted as U.S. exports.
Last year, international visitors spent a record $107.4 billion in travel receipts including passenger
fares for the U.S., an increase of 5 percent over 2005. 2006 marked the eighteenth consecutive
year that the United States has enjoyed a travel and tourism balance of trade surplus -- $7.3 billion
in 2006.

EXPORTS TO CHINA

China is our fourth largest export market. Exports of goods to China have grown by 31.7 percent in
2006, while imports have increased 18.2 percent during the same period.
U.S. exports to China in 2006 were greater than U.S. exports to India, Brazil and France combined.

EXPORTS TO FREE TRADE AGREEMENT COUNTRIES

U.S. Free Trade Agreement (FTA) partners make up 7.3 percent of the world’s GDP (excluding the
U.S.), and exports to these countries comprise more than 42 percent of total U.S. exports. As of
February 13, 2007 the U.S. has FTAs in force with 13 countries*

EXPORTS TO CENTRAL AMERICA

Free Trade Agreements are in force with four CAFTA countries (El Salvador, Guatemala,
Honduras and Nicaragua) and are awaiting implementation in two (Costa Rica and the
Dominican Republic). Negotiations were recently concluded with Panama.

U.S. exports to the above seven Central American countries were $22.3 billion in 2006, an
increase of 17.1 percent over 2005. To compare, U.S. exports to these seven Central American
countries are larger than American exports to Spain, Russia and Argentina combined.

*Australia, Bahrain, Canada, Chile, Israel, Jordan, Mexico, Morocco and Singapore, and four Central American countries: El Salvador, Guatemala, Honduras and Nicaragua. Agreements with Colombia, Costa Rica, the Dominican Republic, Oman, Panama and Peru are awaiting implementation, and FTAs with Korea and Malaysiaare currently under negotiation.

U.S DEPARTMENT OF COMMERCE

[Elwood P Dowd]

73. The Bush Department Of Commerce

Wow!! We need to pass more fake free trade deals before the Bush DOC guys leave office. Life is wonderful under Bushitler.

:sarcasm:

[TreasonousBastard]

85. Oh, please... Even Shrub can't lie about...

a trillion dollars. It's there. It's real.

If you're going to even pretend to argue about issues, you gotta have basic facts. Like how much of that might be military sales, how much is agricultural, industial machinery, services or patents...

And the capital flows involved in these transactions-- who's collecting and profiting from the transaction costs?

Now, for the big prize, how many of these exports are from those small businesses we all talk about with such reverence? Related quwestion for the bonus-- Name at least one state or Federal program to boost small business exports.

[Elwood P Dowd]

86. 1.4 trillion in sales

2.2 trillion is purchases. That's some impressive P&L - only 800 billion dollars in losses.

I wonder how many of those exports were U-Turn products to China or Mexico? Products shipped from US=based corporations to their foreign-based factories. That would be interesting. Oh, and you sure are defensive about the Bushitler Department Of Commerce. Strange????

[TreasonousBastard]

87. Oh, bullshit-- go peddle it somewhere else...

I'm not arguing trade deficits here, or defending Shrubonomics, simply stating the fact that we export over a trillion in goods and services. Most people don't seem to know that. You apparently didn't before I mentioned it.

As I pretty much said last time-- stop wondering, guessing, supposing, and criticising without basic facts.

You could find out how much is U-turn of you wanted to.

[Elwood P Dowd]

89. The truth hurts doesn't it.

The current account deficit of 800 billion dollars a year is a serious problem. If you're not mature enough to realize that, then you need counseling.

[TreasonousBastard]

91. I'm well aware of the current acount and spent 20...

years or so involved in areas of import export adding to the largely irrelevant knowledge I got from an economics degree.

So, as if I'll bother reading the reply, precisely what the fuck does the deficit, or M3 for that matter, have to do with the limited answer I gave to the OP's question?

Trade barriers at this point mean we will stop importing and we will stop exporting, and we will still have the debt without access to foreign capital to help manage it. In fact, it is questionable what will happen to all the foreign captial already here. All those repurchase agreements?

And we will also have to replace the means of production for all the goods we might happen to want but have no ability to make. Without foreign capital. And without the millions of foreign workers now making all that stuff.

[Elwood P Dowd]

92. Thank you.

You have just stated we are now on our knees begging for foreign workers to make the very products we need to survive. We are totally at the mercy of foreign investors to loan us money to pay our trillions of dollars in debt - a growing debt that you wish continues to grow. We can no longer produce our own goods thanks to corporate greed that you support. Tell me, what happens to the rest of the world when we crash and burn thanks to our insane trade policies? Will the Chinese institute a Marshall Plan to save America?

[XemaSab]

103. Thanks for the info

:hi:

[killbotfactory]

90. Wal-Mart would overthrow the government in a coup

and rename the USA WallyWorld

[Tierra_y_Libertad]

94. Massive inflation and lower wages.

We are dependent on foreign goods to keep our economy going. If we were stupid enough to put 100% tariffs on imported goods, prices for goods made here would skyrocket.

The dirty little secret is that this country can no longer compete on the world market because the corporations own it.

It's capitalism. And, the rest of the world is catching on to the fact that we've been living off their labor and resources for decades.

They're using our own tactics against us quite successfully.

[rucky]

99. And they wouldn't respond in-kind?

I suppose we could be self-sustaining if we really tried, but our economy wouldn't ever grow.

[Jacobin]

101. $6.00 a gallon gasoline?

[sentelle]

104. I am far more in-favor of either of the following two ideas

Make every company that ships to the US, have a US partner, with US employees. Make them responsible for anything wrong with the products being shipped. Many manufacturers (like the Auto Companies) do. some (like Walmart's crap) don't. This is done in many countries around the world, like China and Japan, and works well. It keeps them in the know of US customs, and keeps someone responsible (melamine anyone)

Alternatively, we could designate that a certain amount of product, or Final assembly must be done in the US, like what is done in Europe.

After all, if our global competitors think it fair, why should we not do the same?

[ThomWV]

108. What would happen? Easy. Imports would cost twice as much. Wal Mart Would Collapse.

[LSK]

109. Russia is doing something similar to that right now

Don't they have a booming economy???

[Redstone]

111. No, they don't. They have a crippled thugocracy.

Redstone

[LSK]

113. I read that Volkswagon is opening a plant there

And Toyota and Ford have opened plants there because thats the only way they can sell cars in Russia because of their high tariffs.

http://news.bbc.co.uk/2/hi/business/7117689.stm

"Outside of Kaluga, Volkswagen has a lot of catching up to do. Big competitors like General Motors, Ford, Renault, Hyundai and BMW began producing in Russia long ago, and they have all secured a share of the market. Cars coming in from outside are charged an import duty of 25 percent, making it hard for imports to compete. Volkswagen, in particular, has found it difficult to sell cars in Russia, with just under 30,000 cars expected to move out of showrooms this year -- not many more than in 2006."

http://www.spiegel.de/international/business/0,1518,520256,00.html

[Hippo_Tron]

112. Last I recall it's not so great for the people on the lower end

[Didereaux]

110. 50% of Americans couldn't afford food, because we import OVER that amount.

[Donald Ian Rankin]

114. I suspect "Global economic meltdown, mass poverty and starvation" would begin to cover it.

:-The rest of the world would slap corresponding tarrifs on American products.
:-America wouldn't be able to import raw materials for its manufacturing.
:-Prices of everything, including things like food, would skyrocket.
:-American manufacturers would be able to raise their prices.
:-The third world would be rendered significantly more impoverished.

All in all, it would be a spectacularly bad idea, I suspect.