Donald Trump claimed he was being “kind” when he announced the biggest shift in US trade policy in a century. It was typical Trump bullshit of course, there's nothing kind about a kick in the bollocks, which is what he has delivered to world trade.
But was he right as the headline says? For decades the liberal democracies have been obsessed with free trade and globalisation. Tariffs drag us back to the days of expensive imported goods, long customs delays and obstructive regulations. So how can the move be positive?
The US president said reciprocal tariffs of 20pc on the EU and 34pc on China were the result of carefully calibrated calculations based on “the combined rate of all their tariffs and non-monetary barriers” such as currency manipulation.
A White House official said the calculations encapsulated “the sum of all cheating”.
“We will charge them approximately half of what they have been charging us,” President Trump told an audience in the Rose Garden of the White House.
The Trump administration published what looked like a complex-looking but rather theatrical algebraic formula complete with Greek letters to explain its rationale. But in the end, the tariffs boil down to simple maths, casting doubt on the idea that Sir Keir Starmer’s lobbying efforts in the US had any influence on the outcome.
The reciprocal rates are simply based on each country’s goods trade surplus with America relative to how much they send to the world’s biggest economy. Nothing more, nothing less.
On paper global free trade under World Trade Organisation rules looks a great idea, but free trade involves everybody playing according to the same rules. And some nations are notorious for making u their own rules as they go along. I'm sure it would be superfluous to name the main culprits, but it is not a new game and the current rule benders not originate this technique for boosting their economy.
While the USA has suffered somewhat, as issuer of the main reserve currency Washington has been able to protect US interests by manipulating exchange rates. Ironically this is one of the sins they now accuse China of. But don't feel sorry for China, in collaboration with Russia, Iran and a few other eastern nations thy have been working for years to dislodge the US dollar from its dominant position.
In a sense, Trump has already won his trade war, as the Cinese Communist PartyCCP) has massively expanded “export subsidies” to favoured manufacturers so that they dont have to pass Trump tariffs on to customers. In the first two months of this year export subsidies have already amounted to the billions of Yuan. So the people who toil away in CCP controlled factories for CCP mandated wage rates are directly subsidising the western consumers as will their children with the epic CCP central bank expansion in money supply, to keep the CCP command economy above water.
WTO rules exist to ensure subsidies do not
distort international competition or confer an unfair benefit on
domestic producers. These rules are ultimately about protecting free and
fair international trade and competition, so that one country's exports
do not hold an unfair advantage over another.
In attacking Trump tariffs the TDS sufferers in Europe and around the world are missing the point. The EU, for example, is a vast protectionist regime with EU-wide and state subsidies distorting the actual price of its goods. For example, the CAP, the devaluation of the Deutsche euro as a currency for Germany, the subsidies to steel and other industrial goods, the EU tariff regime per se. This has allowed EU goods to be sold at reduced prices and has allowed the EU to accumulate a trade surplus with the USA. Are Trump's tariffs not a corrective measure and a negotiating starting point?
Same goes for China, their mssive subsidies to industry plus low labour costs because the government (The Party) controls wages and prices because as the leadership has made blatantly clear, China intends to dominate world trade in the not too distant future.
In view of these considerations Trump's impostion of tariffs are understandable and if (it's a bif IF,) they have the long term consequence of persuading all parties to observe the WTO rules by complying to, rather than bending them, it could benefit us all.
FROM THE ARCHIVES:
European sovereign debt crisis could cause Eurozone implosion – ex-BoE chief
Are government economists and mainstream media finally catching up with what The Daily Stirrer and Boggart Blog’s finance expert Phil T Looker has said since we started publishing? Former Bank of England chief Mervyn King has written an article warning that Eurozone deabt problems pose a bigger threat to the EU than a British OUT vote in the referendum
Cameron’s EU Package: Not A Deal But A Few Turns In The Spin Machine
As we and almost everybody else predicted, David Cameron's deal to improve Britain's relationship with the EU is worthless. It changes nmothing, and can be vetoed once we have voted to stay in.
Cameron's Hopes For EU Membership Reforms For UK Torpedoed By Tusk
David Cameron’s hopes of winning serious concessions on sovereignty, border controls, contributions, trade agreements, human rights and labour laws so he could claim to have won a better deal for Britain by the time the in / out referendum starts next year European Union suffered an early blow when European Council President Donald Tusk warned that reaching a deal would be “very tough” ...
For many years the dollar has been the currency in which the world's nations settled cross-border transactions and the so called petrodollar became the only currency in which oil could be traded. In recent years however, as other nations, particularly the BRICS group, Brazil, Russia, India, China and South Africa, the leading nations outside the dominant US / European group, have been making moves to end the domination of the US dollar.
Why Iceland Recovery Is Being Ignored In Mainstream News
Iceland is a small country with less that half a million people so is not a good comparison with Britain. It's recovery from near bankruptcy in the wake of the 2008 financial crisis however is due to the rejection of politically correct, globalist politics so in that light it serves to illustrate that to suggest Britain (60 million people) cannot survive outside the EU is just globalist scaremongering.
It's Staring To Dawn On Economists That The Developed World's Economic Problems Are Structural.
When we look back from 2025, it will be painfully obvious that central bank policies exacerbated the systemic crises that brought down the global financialization machine. After all, "saving" the world from financial collapse 0f 2008 was relatively quick work; so what problems beyond imminent implosion have the central banks policies solved in the past 6 years
New World Order IMF Advocates Taking Pensions & Deferring Redemption of Gov’t Debt.
Global Capitalism my arse, the dominant economic system is Naziism pure and simple. Who but Nazis or Communists (and they are truly different faces of George Orwell's Oligarchic Collectivism) whould propose stealing the pension funds we poor punters have worked all our lives to accumilate to pay for the stupidity, selfishness and irresponsibility of our masters?
Financial Crisis? The Dow Has Already Fallen More Than 1000 Points From The Peak Of The Market
The dramatic falls in world wide stock markets over the past week hows that the Daily Stirrer finance expert was correct in predicting this, such recovery in the global economy as has happened since 2008 has been the result of printing money and manipulating the markets. This latest action is part of a massive heist by the bankers to drain the value from our savings and pensions
Corporate Banker's $1.5 Quadrillion Conspiracy: EU Accuses 13 Banks Of Operating A Derivative Trading Cartel
Debt, how much of a threat to ordinary people is it? The truth might frighten you which is why bank bosses, government leaders and media pundits are not eager to tell the truth. What can we do? Not much in the short term, in the long term, reclaim the sovereignty of our nations and our individual sovereignty and tell the world view thinkers their crazy ideas have maxed out their credit
War On Cash Begins, It Is Not About Keeping You Or Your Money Safe From Muggers
Government and big busin.ess has been nudging us towards abandoning cash for electronic money for a long time. Now the Frech government has become the first to move towards making cash illegal (because government can't keep tabs on what you do with your money when cash passes from hand to hand ...
Surging Support for Germany’s Anti Immigration AfD Party Shows Contempt For Merkel's Open Doors Policy
Pegida Organizes Anti-Islamization Protests Throughout Europe
Italy's Prime Minister Says Merkel Unilateral Initiative On Migrant Crisis Is Unacceptable
"Our Europe Is Dying": Young Germans Video Blasts Merkel's "Multicultural Utopia": Censored By Facebook.
Women Fear To Go Out Alone In Danish Town Due to Migrant Assaults
Doctors And Engineers? 65 Per Cent Of Syrian Refugees Can’t Even Read Or Write
EU Mediterranean Crisis
Refugee quotas
Euro bureaucratic empire
Europe Gaddafi's threat
Europe's immigration burden
Human rights problem with Turkey
Europe unglues
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