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No More Excuses on Trade
Trump was in rare form Saturday at the G-7 press conference. It’s hard to argue with his thesis that free trade should be a two-way street. Trade concessions from our friends and adversaries alike must come, and I think they will come. I am a free trader. I believe a free exchange of goods leads to prosperity on the national and international level. I read Adam Smith and David Ricardo. Comparative advantage is a magical thing. But free trade has to be a two-way street. Let all countries reciprocate the free market access that we extend to them. I call for an equitable reduction in tariff and non-tariff barriers that benefits all countries.
When libertarians say that other countries’ tariff rates are none of our business, that’s a load of nonsense. Does this policy extend to all aspects of foreign policy? It’s none of our business when other countries block sea lanes? It’s none of our business when they invade and occupy their neighbors? Is it our business when countries sell nuclear and chemical weapons all over the world?
This is not a serious position. It is what I would like to call “the one-way street” approach to free trade. The idea that since free trade is beneficial it should be undertaken without reciprocation is extremely flawed. This approach may be the optimal one if you are a small country like Chile with no international market power. However, the US economy represents 22 percent of global GDP. That is power.
Of course, neither I nor President Trump intends to use this power to hurt other countries on trade. Proof of this is the fact that at the G7 meeting, our supposedly “protectionist” President floated Larry Kudlow’s idea for a tariff-free G-7. Yes, you read that correctly: Trump offered to eliminate all US tariffs on goods from G-7 countries if G-7 countries agree to reciprocate! Did you hear that? That was the sound of our mealy mouthed allies running out of excuses for continuing their unfair trade practices. It’s time for our allies to put up or shut up.
European sophisticates love to lecture Trump and his supporters on multilateralism and politeness, but they should practice what they preach. The German schoolmarm Angela Merkel, pictured above lecturing our President, needs to explain why the winner of WWII has to pay the loser four times the tariff rate on car imports. If our trading partners want free trade, it should be free trade that benefits everyone. No more protection of favored business interests. No more byzantine regulatory excuses. No more!
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Reasoning will never make a Man correct an ill Opinion, which by Reasoning he never acquired
Jonathan Swift. Gary is talking about his religion and we should allow him to believe what he believes, even if there is no evidence.
He is over the line tweeting insults at Trudeau, but I can almost overlook it for having him drive a stake through the heart of the old, useless GOP. Even that twit Bill Maher knows that unless the economy tanks, any primary challenger will go down in flames.
Do you anticipate the 22nd Amendment be withdrawn by a new constitutional amendment?
Why? Whose interests ought the Canadian PM protect? What he basically said was “Canada First.” To which the appropriate response is “No [coc], Sherlock. But do you mean the interests of all Canadians, or Canadian unions and large corporations?”
A tariff free G-7 would be great. I don’t think that Trump is serious, but I’d like to see his challenge be accepted.
As a starter, would you agree to abolish our Sugar tariffs and restrictions?
They don’t want to lose the protection for their favored industries.
This Cato Institute trade lawyer explains all the legal process reasons we can’t have a G-7 free trade area. My answer is if WTO rules and other existing multilateral arrangements keep us from implementing truly free trade, then I’m even more convinced than ever that a disruptive wrecking ball is what is needed. Oh, and kill all the lawyers.
I think that it makes Trump look like a jerk. Trump was successful in bullying the Republican Party, but insulting the other candidates, and now attacking people who are not in lock-step to him. However, the GDP of the G-6 (the G-7 minus the U.S.) is greater than our GDP.
They want to protect their favored industries while having free access to other countries’ markets.
Absolutely.
Yes, abolish all of our tariffs and all other countries reciprocate. BTW, talk to my fellow neocon Marco Rubio about protection of the sugar industry. Nobody gets a pass.
But Gary, you think everything makes Trump look like a jerk, including the sun coming up in the morning. Of course you think this picture does. That says more about you than anything about the picture.
We are living on an ever ballooning sea of debt. Obama brought us trillion dollar deficits during the Great Recession, but got them cut down as the Great Recession lessened. We are now at peak employment, but are back to trillion dollar deficits. What are we going to do when the business cycle comes back?
I agree with the majority of Trump’s policies other than trade. They are succeeding despite Trump the very flawed person.
I hope that Trump’s policies will succeed despite his huge personal flaws.
Sure, Canada first for the Canadian leader and America first for the American president. But consumers are Canadian and American citizens too. Consumers matter too. I don’t want to hear about shared values from free trade hypocrites.
I respectfully disagree. I greatly prefer the Party of Reagan over the Party of Trump.
I have no idea what in the world you are talking about with the phrase “the old, useless GOP.” Please explain.
I suggest that you review the phrase “Kill all the lawyers” from Shakespeare. The gist of longer phrase is “so that we can impose tyranny, we must first kill all the lawyers.”
I would suggest that the Second Amendment and the Rule of Law is what has protected ur country from ever sliding into an authoritarian country, or the lawlessness of much of the Third World.
We are in agreement. Thank you so much.
That is a black mark against Marco Rubio. We are in agreement.
But you started out by stating that everything Trump touches dies.
I don’t remember the old GOP as being the party of Reagan. I remember the old GOP referring to Reagan’s economic ideas as “voodoo economics”. I remember the old GOP worried that Reagan’s attempts to deal with the Soviet Union would result in WWIII. Reagan’s accomplishments were undermined by the Bush administration almost as soon as it took control in the name of a “kinder, gentler” vision. That’s what I mean by the old, useless GOP. The GOP was in my memory “Democrat Lite”, more of the same, just not so quickly and not quite so much. Unless, of course, the Mandela Effect is real and I’m experiencing it.
FWIW, I much prefer Reagan’s style to Trump’s style (or lack of style), but I believe the old GOP is the main reason we have Trump.
I wasn’t speaking literally. I think you know that. I was criticizing the red tape that takes money out of our pockets.
That is possible. I am predisposed against Trump, beginning with him starting his political career with the Birther Big Lie, and an avalanche of absurd statements such as saying that Ted Cruz’s father helped Lee Harvey Oswald kill Kennedy.
The best thing that Trump has done is to outsource Judges to the Federalist Society. I am delighted by the huge number of conservative judges in their 30’s and 40’s being appointed to the federal bench. (Great credit must be given to Mitch McConnell and Chuck Grassley in this regard.) This was the one place where I wavered in 2016 on who I would vote for.
I also am glad to see Trump rolling back regulations. Again, this has been greatly supported by the House and Senate using the Congressional Review Act (CRA). Credit again to McConnell and Ryan.
If Trump were a different person, he would be headed to a safe re-election. Instead, due to his erratic behavior, he is empowering the need of the American people to elect Democrats to put a check on Trump.
Point well taken.
On the other hand, Trump policies are being relentlessly undercut by Trump the person.
Okay, okay. At the start, maybe even prior to the conference start, the “G-6” said they wanted to issue a joint communique that said tariffs should be lowered, perhaps in response to rhetoric originating from the White House, and, indeed, the previous national election. The President looks at his current trade agreement cheat sheet and snickers. It’s just a posture to adopt that sounds good with no real effect. So, the President, seeing this is an effort to weaken the US position, says I’ll do one better and proposes a completely tariff-free zone.
Why would this be a bluff? Access to these markets is precisely what he talked about prior to the conference, and this would be access…American autos in Germany, American Dairy in Canada.
The offense here is not allowing the others the luxury of posturing while doing nothing. Now, the responsibility for action, based on the principle they wanted to use against the US, is on them.
It’s the same thing Trump did with the pardons and the protesting professional athletes. Bring me a list, he says, and we’ll take a look. Responsibility for action is now on them, and the outcome is possible, but, here again, the offense is not allowing the posturing.
I think Gary, for one, is not against people taking responsibility and putting their money where their mouth is. I fail to see a need to judge the statement unless an opportunity to create this free-trade zone is ignored by the person proposing it. For now, the statement serves to preempt the other nations and, quite frankly, to keep everyone on one side of a line that, if crossed, would be a great step toward dissolution of the G-7 dialogue.
Gary,
You think everything makes Trump look like a jerk, because you think he is a jerk. :)
Now, as far as playing nice, I don’t really care what the other nations of the world want. I want what is best for America. Now, that might mean playing nice, but I have to say, I have spent a lifetime seeing the people of other nations and their leaders bash us in public.
America saved the West from the USSR, saved Europe from Germany, saved Germany from the Nazis, saved Asia from Japan, and helped to stop the spread of Communism around the world. None of this was in our direct best interest, other than it preserved allies, who to this day, are largely ungrateful. We could have told the USSR that Europe was theirs and divided up the world with that evil Empire. We didn’t.
So, I don’t really give a fig, if Trump tells the other nations “Let’s try Free Trade and we will see”, as opposed to America has less protections and everyone else has more.
I don’t think that I disagree with you. Great and careful analysis.
Nope, he will just ignore it. Trump is the new Hitler after all.
It’s the same thing Reagan did with nuclear weapons with Gorbachev. His advisors freaked out but it was a negotiation move. They are supposed to know this stuff. TV today had Bill Richardson on talking about NK. He was there something like 7 times and what did we get ?
Some expert.
Sheer chance mandates that you’ve gotta be right sometime, Gary.
I was thinking the same thing, Mike, thanks.