I'm not very well versed in economics, but why isn't free trade just a universal thing?

I'm not very well versed in economics, but why isn't free trade just a universal thing? — Michael

Because tariffs have been used as an argument on the right and left (more often right if you ask me) to support local and domestic industries. People who buy into that argument, then, support tariffs and protectionist policies.

My two cents.

Trump's trade war will boost GDP in the long term? According to what economic model? According to what evidence? — Baden

Understanding how economics works. Trade barriers will cause the local economy to start up once again, which means both increased investment and increased consumption (more wages paid in the economy). Trade barriers will make products more expensive, but that isn't a concern when it comes to GDP growth.

For what reasons do you claim that protectionism cannot be effective at growing GDP long-term?

if by the end of the year overall growth is four per cent or more I'll post a picture of myself here in this discussion wearing a MAGA hat. If it falls more than half a per cent short of that, you post a picture of yourself with an "I Love Hillary" speech bubble coming out of your mouth. OK? Or is this just hot air? — Baden

Well, no, I'm not ready to make quantitative claims about the growth rate. I think it will be very good, but even a 3.5% growth would be very good for the US.

They just need to be properly regulated. Where are the funds for entrepreneurship going to come from if not banks? — Baden

Bootstrapping, savings, private investors, government subsidies/funding programs. Like that.

No banks are needed. Sure, growth may be slower, so what? It will be more stable.

Of course the rub is that when inflation outpaces wages growth for long enough due to this randonomics type approach, Agu's wage slaves won't be able to buy his stuff any more. — Baden

Well, I only sell to other businessmen, so...

They are simply players in a system that can either distribute its benefits rationally for the greater good, as democratic socialists would like, or that can feed the avarice that you and those of your political ilk would espouse. — Baden

I disagree that democracy can distribute resources and benefits rationally and fairly for the greater good. The way I see it, central authority is needed to set the economic AND social agenda of society in order to have stability. Democracy is, by its very nature, unstable, and always falls victim to mediocrity, and the fickle nature of "the public". Resources are to be used for the public good, but they must be managed by those who are capable of managing them to deliver the best results.

You've conceded the point then. Trump's policies won't lead to a sustainable level of four per cent growth as he claimed, so I was right to say that his claim was false. It's either an exaggeration or another deliberate lie.

And his brand of protectionism will not lead to more growth in the long term compared to free trade because, for a start, it makes the US less competitive. Trump has already had to pencil in twelve billion dollars to pay farmers who have lost their markets because of retaliatory moves by other countries, notably China. Protectionism may be necessary in limited circumstances but Trump's trade war tarriffs won't work now because other countries won't let them work (I'll try to find the source but the figure I saw was they would in a best case scenario lead to a moderate reduction in GDP of a quarter of a per cent per year or so). The other obvious point is Trump is not even using them for economic reasons. If there were solid economic reasons behind them, at least his own party would support them. But, it's more like, as Benkei pointed out, an ill-thought-out exercise in foreigner bashing to appeal to his base.

Most directly related to tariffs, there are good reasons to foreclose domestic markets. Sometimes a protected industry is necessary to ensure national security, such as defense manufacturing. Domestic production of basic foodstuffs is often pursued as well to ensure independent subsistence for a nation.

A country can bar products outright as well of course, such as guns or certain drugs. To reach full free trade you'll also need very far reaching standardisation on product quality as well and harmonisation of trade law and tort.

You've conceded the point then. Trump's policies won't lead to a sustainable level of four per cent growth as he claimed, so I was right to say that his claim was false. It's either an exaggeration or another deliberate lie. — Baden

No, I haven't conceded the point. Trump didn't say that they will be 4% for certain. If you listen to the speech you will see that he also claimed the results will be very strong, could be over 4% even. That's also my claim.

And his brand of protectionism will not lead to more growth in the long term compared to free trade because, for a start, it makes the US less competitive. — Baden

What does "less competitive" mean? How do you quantify that? If companies which buy steel, say auto manufacturers, end up paying 30% more for steel, and they raise their prices by 15% let's say, who is to say that they become less competitive? That depends on whether the demand for cars is elastic or inelastic.

Trump has already had to pencil in twelve billion dollars to pay farmers who have lost their markets because of retaliatory moves by other countries, notably China. — Baden

Yes, until investments kick in, the economy does need some support.

Protectionism may be necessary in limited circumstances but Trump's trade war tarriffs won't work now because other countries won't let them work (I'll try to find the source but the figure I saw was they would in a best case scenario lead to a moderate reduction in GDP of a quarter of a per cent per year or so). — Baden

And so they will suffer as well. They will need to negotiate.

"We're now on track to hit an annual GDP growth of over 3%, and it could be substantially over 3%". This is what Trump said.

Trump has been promising 4% growth since the beginning:

His words on the campaign:

"I guarantee... get a Donald J. Trump presidency and we'll have FOUR percent growth for FIVE years."

Can't be much clearer than that.

It wasn't in the speech I linked to though. He may have promised that during the campaign, and America will get there, but obviously now he's not putting his hand in the fire for it, lots of things can change. But he is right that America is on track for 3%+ GDP growth.

"We're now on track to hit an annual GDP growth of over 3%, — Agustino

So, the big promise now is 3% down from 4% growth. Well whoop-de-doo. Clinton's average was 3.9%. :yawn:

But he is right that America is on track for 3%+ GDP growth. — Agustino

Evidence? The predictors I've seen say 2.7%-2.9% for this year.

Anyway. after all this hoopla, all this MAGA hype, Trump's big thing is a revised promise of growth of about a percentage point less than Clinton, which is the best he'll do. And you think that's an achievement. Why?

https://www.kiplinger.com/article/business/T019-C000-S010-gdp-growth-rate-and-forecast.html

"GDP should increase 2.9% for the year, after 2017's 2.2% pace" (giving Trump about a 2.5% average. An average that's been beaten by every president in the last 80 years except the Bush's and Obama. Again, it's all hype. Even after the massive tax breaks to the rich and massive additions to the debt and all the interventions, there is nothing here.)

Also explains the blip:

"Exports advanced strongly as purveyors of soybeans and other goods shipped to China drew down stockpiles to get in ahead of Beijing’s tariffs. The accelerated schedule should diminish third-quarter export growth a good deal."

We have already established that harsh criticism and personal attacks, well let me revise that: personal attacks only, are the status quo when criticizing president Trump, the deplorable s who voted for him and others who support him.

Fair criticism cannot be expected on 2 counts: firstly, 75% percent disapproved of him (not his policies, him) before his presidency began. You cannot get more prejudiced than that. Then, the press is biased against him as the Havard study has found.

https://www.zerohedge.com/news/2017-05-19/harvard-study-reveals-huge-extent-anti-trump-media-bias

So let's establish as a fact the prejudice: against his stand on issues, but this cannot be attacked directly, so attack his tweets, his language, his methods etc. I understand the strategy. One thing I can tell you America's enemies will be so happy that the country is so divided. 4% growth rate and that is attacked.

Some statistics to attack:

Worker pay rate hits highest level since 2008
By: Jeff Cox
43 Mins Ago

(CNBC)

Gallup poll:

https://www.businessinsider.com/trumps-approval-rating-gallup-highest-level-poll-2018-6

Earlier, the fact that Trump equalled Obama's rating was a big concern for CNN( April 2018)

"The big problem with that Gallup poll that shows Donald Trump's re-election numbers equal to Barack Obama's"

Presumably Trump has passed that mark now?

Also, there is the party divide that shows here:

"Republicans' support for Trump remains high at 87% even after the family separation controversy, but is lower than their 90% approval during the prior two weeks. Republican approval of Trump is now back to the average for his second year in office.

Democrats' 5% job approval -- down from 10% the prior week -- ties the lowest he has had among that group, which also occurred in four other weeks, including one in December and three in January."

https://news.gallup.com/poll/235955/trump-job-approval-slips-back.aspx


More attacks on the economy: New York Times this time:

Op-Ed Columnist
Why One Quarter’s Growth Tells Us Nothing

The idea was to increase the economy’s capacity. There’s no sign that’s happening.

By PAUL KRUGMAN
July 28, 2018
The Rules for Beating Donald Trump

Don’t argue with 4.1 percent growth.

By BRET STEPHENS
July 28, 2018

https://www.nytimes.com/topic/subject/united-states-economy

There may be fake news but attacks - in - print cannot be faked.

North Koreans back to building up their nuclear arsenal as predicted. Another abject failure.

https://www.washingtonpost.com/world/national-security/us-spy-agencies-north-korea-is-working-on-new-missiles/2018/07/30/b3542696-940d-11e8-a679-b09212fb69c2_story.html?utm_term=.defbcc4171dc
https://www.bbc.com/news/world-asia-45015343
https://www.wsj.com/articles/north-korea-expands-key-missile-manufacturing-plant-1530486907

GDP growth in 2017 was 2.3%, and I'm somewhat skeptical that it will hit 3% this year.

But even if Trump does manage to hit 3% for this year and others (a number he vacillates on from time to time), it means very little for the average American if the benefits mostly end up in the pockets of a very small class.

so after months and months of tweets of "no collusion" , do you think Trump supporters will give him yet another pass on lying if collusion is proven ?

It will be spun as a "good thing" that Trump colluded with Russia, because the alternative would have been a Hillary Clinton presidency.

I'm starting to think the polls have become meaningless, or broken. Something has certainly changed.

There's only a 13% difference between Trump's all time high and low among republicans (low of 77% approval among Republicans (Dec 2017), and a high of 90% ( January, June, and July, 2018)). Among independents there's an 11% variation between high and low, and only 8% among democrats. His total approval high is 45% and his total approval low is 35% (10% difference). Every other president accounted for with polling data (since Roosevelt) has had more than twice that amount of variation between their all time high and low. (Obama had a difference of 27% between his all time high and low, and most other presidents have had huge swings in total approval).

So what the fuck is going on?

Looking at the specific poll question they use "Do you approve or disapprove of the way Joe Everyman is handling his job as president?", is it possible that the way people interpret this question, on average, has shifted? (given the widespread opposition to Trump, the connotations of "handling" may cause people to take into account the obstacles they feel he is facing. While some may think the outcomes of Trump's presidency are failures, they might also think that he handled himself well if the odds were stacked against him.)...

Maybe this is just what you get with this level of political and ideological division/animosity. Resentment of opponents causes us to entrench ourselves in opposition, while the middle ground becomes an impassable no-man's-land of explosive flak and friendly fire. When we feel sufficiently afraid or personally threatened, we will fight for our side even if we think it's not a just cause.

I reckon this is a bad thing for democracy. If instead of voting our minds and hearts we're voting our team colors because we've all been emotionally hijacked by flashing lights on the T.V, then it's done.

If our loyalty and approval toward our party leaders is cannot waver, regardless of how they behave, how can we ever expect to exert democratic influence over them once they're in office?

Is it really all or nothing in that our side has to win at all costs, regardless of how poorly things are going, because fuck the other side?

Previously undisclosed evidence in the possession of Special Counsel Robert Mueller—including highly confidential White House records and testimony by some of President Trump’s own top aides—provides some of the strongest evidence to date implicating the president of the United States in an obstruction of justice. Several people who have reviewed a portion of this evidence say that, based on what they know, they believe it is now all but inevitable that the special counsel will complete a confidential report presenting evidence that President Trump violated the law.

NYBooks Daily

One would think the main line republicans are in no way happy to have to hitch their wagon to Trump in the mid terms, and beyond. I would not be surprised if they would be delighted to see a tight case of impeachable charges brought to the house. The assumption that Trump is not impeachable because of a Republican majority is tenuous IMO. Would not be surprised if the GOP would be more than happy to get our from under Trump.

The assumption that Trump is not impeachable because of a Republican majority is tenuous IMO. — Rank Amateur

Why? I think that case is quite strong due to political identity being a rather strong part of Americans' overall identity. I've got 20 political parties to choose from. Sidling a bit to the left of right to the next party isn't a thing that impinges on my personality. It's different in the states.

There isnt much of a connection between Trump and crazy evangelicals as there was with Bush 43. I wonder if Trump's an atheist.

Yeah, it'll be "Presidents can't be indicted" followed by the Republicans in Congress with "we're not going to impeach him because it looks bad on us" and then Republican voters with "I don't give a shit because he's on my team". — Michael

Poll: Some Republicans find Russian help in midterms 'appropriate'

A Yahoo Finance/SurveyMonkey poll released Tuesday finds that 11 percent of Republican or GOP-leaning Americans surveyed said it is "appropriate" for Russia to try to help Republicans, while 29 percent said it's "not appropriate, but wouldn't be a big deal."

Called it.

Dammit was just about to post the same thing

I don't see an answer to my question in all of that. Errors? Yes, no, or don't know — Sapientia

You point out the error and I will analyse.

Other than that, errors are what is to be expected when one encounters hurdles and opposition.

A leopard can't change its spots. Trump was being played from the start.

You point out the error and I will analyse. — raza

Analysis? More like apologetics and whataboutery.

So that’s a pass then?