Trump Dump: Foreign Policy (Thread I)

[mr friendly guy]

Now the Don has gone after the NHS.
link

Donald Trump slams ’Washington liars’ and Britain’s NHS in Twitter rant
IN a fresh Twitter rant, Donald Trump has had a crack at Washington’s “liars” before taking aim at Britain’s beloved NHS, and Theresa May is not happy about it.

THERESA MAY has hit back at Donald Trump after he slammed the “broke” NHS — in the latest war between No 10 and the White House.

The PM insisted she is “proud” of the health service and backed a furious blast from Jeremy Hunt against the President, risking a fresh diplomatic bust-up.

Mr Trump claimed in a tweet that the troubles experienced by the state-funded system are proof countries should not offer universal healthcare to all their citizens.


Donald J. Trump
✔
@realDonaldTrump
The Democrats are pushing for Universal HealthCare while thousands of people are marching in the UK because their U system is going broke and not working. Dems want to greatly raise taxes for really bad and non-personal medical care. No thanks!

8:11 PM - Feb 5, 2018
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Mr Trump wrote: “The Democrats are pushing for Universal Healthcare while thousands of people are marching in the UK because their U system is going broke and not working.

“Dems want to greatly raise taxes for really bad and non-personal medical care. No thanks!”

The comments were a reference to a march in London over the weekend which saw thousands of people protest against the NHS funding crisis.

Labour MPs and campaigners joined the demonstration which ended up at the gates of Downing Street, claiming the health service needs more cash or it will risk collapsing.

The tweet sparked an angry response from Mr Hunt, the Health Secretary, who insisted the NHS is far superior to the US system.

He said: “I may disagree with claims made on that march but not ONE of them wants to live in a system where 28 million people have no cover.

“NHS may have challenges but I’m proud to be from the country that invented universal coverage — where all get care no matter the size of their bank balance.”

Mrs May supported him this afternoon, saying the minister’s statement “speaks for the Government”.

Mrs May’s spokesman added: “The Prime Minister is proud of having an NHS that is free at the point of delivery. NHS funding is at a record high and was prioritised in the Budget with an extra £2.8 billion ($5 billion).


Jeremy Corbyn
✔
@jeremycorbyn
Wrong. People were marching because we love our NHS and hate what the Tories are doing to it. Healthcare is a human right. https://twitter.com/realdonaldtrump/sta ... 4818450432 …

9:44 PM - Feb 5, 2018
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Jeremy Corbyn responded to Mr Trump: “Wrong. People were marching because we love our NHS and hate what the Tories are doing to it. Healthcare is a human right.”

Brit health spokesman Baroness Jolly added: “Trump is dangerously deluded about the NHS. He needs to read up on how his own health system works before attacking others.

“The NHS is a jewel in the crown of UK society. We should always be proud of the fact that British people can see a doctor without the fear and anxiety of being hit by a massive medical bill.”

The President’s friend Piers Morgan tweeted: “Wrong, Mr President. Our NHS is a wonderful, albeit imperfect, health system — and the envy of the world. By comparison, the US healthcare system is a sick joke & the envy of no-one.”

Mr Trump’s tweet came minutes after former Ukip boss Nigel Farage was on TV in the States talking about the pressures on the NHS and the march.

Mr Farage told Fox News: “The National Health Service has turned into the International Health Service and we’re providing a lot of healthcare for people coming into Britain from all over the world.


Jeremy Hunt
✔
@Jeremy_Hunt
I may disagree with claims made on that march but not ONE of them wants to live in a system where 28m people have no cover. NHS may have challenges but I’m proud to be from the country that invented universal coverage - where all get care no matter the size of their bank balance https://twitter.com/realdonaldtrump/sta ... 4818450432 …

9:19 PM - Feb 5, 2018
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“Right now it’s pretty much at breaking point. The big point is that when the state gives benefits to people then any attempt in the future to reform it or take those benefits back becomes politically impossible.

“That’s the big debate that you need to have in America. If you were to introduce universal healthcare, paid for centrally under taxes, you would never ever be able to remove it.”

Mr Trump’s remarks risk stirring up further anger among Brits after he previously claimed the UK is riddled with terrorists — prompting calls for the President’s invitation for a state visit to Britain to be revoked.

Just 10 days ago, he seemed to have made up with Theresa May when the pair pledged to work closely together as they meet in Davos for the first time since Mr Trump retweeted anti-Muslim propaganda from Britain First.

The President had been due to visit London this month to open the new US embassy in Battersea, but scrapped his plans saying he was angry the building had cost so much and was in an “off location”.

He is still scheduled to come here in October, on a trip which is likely to be met with mass protests.

<snip the non NHS bits>

I am sure the UK is enjoying its special relationship with the US.

[The Romulan Republic]

No one ever said it wasn't an abusive relationship...

[Simon_Jester]

Trump, specifically, doesn't do non-abusive relationships.

[SpottedKitty]

No one ever said it wasn't an abusive relationship...

And if there's one thing His Orangeness has shown, it's his impeccable ability and timing in tossing abuse our way.

[Crazedwraith]

Well US and UK healthcare systems are the opposite ends of the spectrum, basically no one has either of our systems and most fall somewhere in the middle.

[U.P. Cinnabar]

No one ever said it wasn't an abusive relationship...

And if there's one thing His Orangeness has shown, it's his impeccable ability and timing in tossing abuse our way.

Anglophobia is as American as Fleet Admiral Ernest King.

[Simon_Jester]

Anglophobia is very American, but so is Anglophilia. Usually, the Anglo-American relationship (since the mid-19th century) has been the result of a mix of these two forces. America both loves, and hates, Britain.

But Donald Trump cannot express love towards Britain, since Britain is not Donald Trump. All he knows is impulsive berating and abuse, so when he has power, the relationship becomes one of abuse.

[FireNexus]

https://www.vox.com/policy-and-politics ... tein-trump

Friday afternoon, the Justice Department released an indictment that’s part of the investigation into Russian interference in the 2016 election led by special counsel Robert Mueller.

The indictment outlines the lengths Russia went to influence the election in favor of Donald Trump and against Hillary Clinton — including by supporting Bernie Sanders (and, later, Jill Stein).

The Russian operations on social media were meant to communicate derogatory information about Hillary Clinton and other candidates, including Ted Cruz and Marco Rubio. And they were supposed to support Sanders and Trump.

“Use any opportunity to criticize Hillary and the rest (except Sanders and Trump—we support them),” they were directed, according to the indictment.

This was because the Russians involved really didn’t like Hillary Clinton.

Around September 14 in 2016, for example, one “account specialist” of a Russian-controlled Facebook group called “Secured Borders” was reprimanded for having a “low number of posts dedicated to criticizing Hillary Clinton.”

The specialist was also told, “it is imperative to intensify criticizing Hillary Clinton.”

Later on, Russian operatives used accounts they controlled — including an account called “Woke Blacks” and “Blacktivist” — to urge Americans to vote for third-party candidates or not to vote at all. “Choose peace and vote for Jill Stein,” one such message read. “Trust me, it’s not a wasted vote.”

You know, my hate for the whole Bernie Sanders movement getting vindicated in this way is just wonderful.

Seriously, that guy wasn’t the problem. But man did he make it easier.

[Ziggy Stardust]

I'm going to pre-emptively beg TRR not to bite on FireNexus' bait in the last post, because I really don't want yet another 5 page side-bar rehashing the same arguments vis-a-vis Bernie and the 2016 election. Please, TRR, just let it go, unless it's very substantively related to the allegations made specifically in this indictment. I know I'm not a mod so I have no power, here, but I don't think I'm the only member who would appreciate this thread not becoming another shit-flinging spectacle.

[SCRawl]

I actually am a mod, and I'm fine if you want to have that discussion. Just don't have it in this thread, it isn't the place for it.

But kudos to Ziggy for recognizing the potential for a discussion descending into a shitshow.

[The Romulan Republic]

I'm going to pre-emptively beg TRR not to bite on FireNexus' bait in the last post, because I really don't want yet another 5 page side-bar rehashing the same arguments vis-a-vis Bernie and the 2016 election. Please, TRR, just let it go, unless it's very substantively related to the allegations made specifically in this indictment. I know I'm not a mod so I have no power, here, but I don't think I'm the only member who would appreciate this thread not becoming another shit-flinging spectacle.

Why don't you tell that to FireNexus? But yeah, this isn't the place for that conversation, even if it reflects rather poorly on this board that you can't mention Bernie Sanders without risking a thread derailment. Besides, rehashing 2016 ad nauseum is simply playing Putin's (and Trump's) game (One of the first things that occurred to me when this story broke was basically "Even being exposed, Putin wins, because this will set the Left at each other's throats again.")

But these indictments are a huge story. They're another blow, and perhaps the most potent yet, to the credibility (if they ever had any) of those who still deny Russian election interference, and, though they do not prove that Trump directly colluded, they do demonstrate his gross negligence in refusing to address the threat now, and the severity of his obstruction of justice in trying to impede this investigation.

Here's a better (or at any rate more detailed) article on the story, courtesy of the New York Times:

https://www.nytimes.com/2018/02/16/us/p ... rence.html

WASHINGTON-The Justice Department charged 13 Russians and three companies on Friday in a sprawling indictment that unveiled a sophisticated network designed to subvert the 2016 election and to support the Trump campaign. It stretched from an office in St. Petersburg, Russia, into the social feeds of Americans and ultimately reached the streets of election battleground states.

The Russians stole the identities of American citizens, posed as political activists and used the flash points of immigration, religion and race to manipulate a campaign in which those issues were already particularly divisive, prosecutors said.

Some of the Russians were also in contact with "unwitting individuals associated with the Trump campaign," according to court papers. Robert S. Mueller III, the special counsel leading the investigation, made no accusation that President Trump or his associates were knowingly part of the conspiracy.

"The indictment alleges that the Russian conspirators want to promote discord in the United States and undermine public confidence in democracy," Rod J. Rosenstein, the deputy attorney general overseeing the inquiry, said in a brief news conference. "We must not allow them to succeed."

The 37-page indictment-handed up by a federal grand jury in Washington-amounted to a detailed rebuttal of Mr. Trump, who has sowed doubts that Russia interfered in the election and dismissed questions about its meddling as "fake news".

Full article through the link (its fairly long).

Much will be made of the fact that the indictments do not name Putin as being behind it, and that they say the Russians contacted "unwitting" members of the Trump campaign (never mind that we already know from released emails just how "witting" some, like Donald Jr., were in their involvement with Russians to undermine Clinton). But as noted in the article, other aspects of the investigation are ongoing.

In any case, this very clearly establishes the nature and scope of Russian interference, and indirectly calls into question the legitimacy (morally, at least, if not legally) of Donald Trump as President.

Beyond that, I think that the most disturbing thing is the report of Russia organizing rallies, including conflicting pro and anti-Trump rallies in New York after the election. That suggests to me an effort to forment political violence, and disrupt the peaceful transition of power.

Even though I was probably more on my guard than most, it also makes me wonder how much of what I have read these last few years is true, and how much my own views might have been shaped by Russia's lies and half-truths.

Edit: Forgot to include link.

[FireNexus]

That last part is sort of why I needled about it, in light of the new evidence. The last I’ll say about it is, given what we know, I will really be surprised if his fundraising doesn’t turn out to ultimately be tainted.

I don’t think Sanders had any part in it, but I do think that he recognizes what these indictments mean for him and is not very comfortable with it.

[K. A. Pital]

Russia is the mastermind, a global enemy which is simultaneously very strong (capable of orchestrating regime change in the USA) and very weak (corrupt rump state, which only depends on oil, etc.).

I will let Umberto Eco speak:

The followers must feel humiliated by the ostentatious wealth and force of their enemies. When I was a boy I was taught to think of Englishmen as the five-meal people. They ate more frequently than the poor but sober Italians. Jews are rich and help each other through a secret web of mutual assistance. However, the followers must be convinced that they can overwhelm the enemies. Thus, by a continuous shifting of rhetorical focus, the enemies are at the same time too strong and too weak.

[Thanas]

Russia is the mastermind, a global enemy which is simultaneously very strong (capable of orchestrating regime change in the USA) and very weak (corrupt rump state, which only depends on oil, etc.).

None of that is unprecedented in history, see for example the Ancien Régime for that, which was corrupt, much diminished and highly dependent on certain trade goods, yet still able to defeat its adversaries like Great Britain mere years before its downfall. Or Rome in the fifth century, the Russian Empire in the early 20th century...

[Thanas]

[The Romulan Republic]

Man, am I glad Oliver's back from break. Its somehow made the daily insanity worse, not having him around to comment on it.

[Broomstick]

Man, that's one of those things where you're laughing so hard you're crying, then crying because the truth hurts. Thanks for posting that.

[Simon_Jester]

Russia is the mastermind, a global enemy which is simultaneously very strong (capable of orchestrating regime change in the USA) and very weak (corrupt rump state, which only depends on oil, etc.).

Orchestrating regime change in the US requires cunning, not strength. The Koch brothers by themselves probably have as much power to tip an American election as the Russians exercised in 2016, and how many divisions have the Kochs?

[mr friendly guy]

http://www.abc.net.au/news/2018-03-02/d ... us/9502118

Trump wants to get tough on China with tariffs. Only problem is these tariffs will affect Canada and the EU waaaaay more than China.
Good job Trump. Who needs Putin pulling the strings when Trump is already so incompetent?

Donald Trump's tariffs not great for Australia, but terrible for the US
By business reporter Stephen Letts
Updated 59 minutes ago

United States President Donald Trump is a great fan of building walls and as he modestly put it, "Nobody builds walls better than me".

Key points:
Donald Trump proposes a 25pc tax on imported steel and 10pc tax on imported aluminium
Canada and the EU are the biggest exporters of steel and aluminium to the US. Australia and China are much smaller players
Manufacturers, farmers and the military oppose the tariffs, Mr Trump says they will boost "national security & jobs"
As an aside to his 2015 panegyric on wall building, Mr Trump added, "I'll build them very inexpensively".

It is hard to see how that works out with his plans for the Great Big Steel and Aluminium Tariff Wall he plans to construct around the world's biggest economy to keep out pesky imports.

Even Republicans are unhappy
Outside the owners of US steel and aluminium mills and their declining workforce, it is hard to find anyone who thinks it is a great idea.

The list of those opposing the tax on imports includes Republican free-traders, especially representatives of rural constituencies, the US Commerce Department, the US military and that is just within the Washington beltway.

The US Commerce Department plugged the plans for a 25 per cent tariff on steel imports and 10 per cent on aluminium into its modelling and found, just for starters, the idea was bad for national security because it weakens domestic manufacturers who supply among other things, the US military.

"In plain language, these tariffs are a terrible idea," said Tom Porcelli, US chief economist with the investment bank RBC.

"In fact it is such a terrible idea that there was talk amongst the GOP [Republican Party] today about pulling some of the President's unilateral trade authority."

As Kansas-based Republican chairman of the House Agriculture Committee Pat Roberts said: "Every time you do this you get retaliation [and] agriculture is the number one target."

"I think this is terribly counterproductive for the agriculture economy."

Watch out soybean and other croppers who rely on exports to China and the EU for a large part of their livelihoods. Revenge can be served with pulses and grain too.


Donald J. Trump
✔
@realDonaldTrump
Our Steel and Aluminum industries (and many others) have been decimated by decades of unfair trade and bad policy with countries from around the world. We must not let our country, companies and workers be taken advantage of any longer. We want free, fair and SMART TRADE!

8:12 PM - Mar 1, 2018
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While Mr Trump said, "We're going to build out steel industry back and our aluminium industry back", it ignores the damage higher prices which are attached to protected products, will have on factories buying US steel and aluminium.

For a start, the big car makers and their workers won't be happy. Toyota was first off the grid, saying more than 90 per cent of the steel and aluminium used in their US-built cars was sourced in the US.

"The administration's decision to impose substantial steel and aluminium tariffs will adversely impact automakers, the automotive supplier community and consumers," Toyota told Reuters.

The price of oil and gas rigs will head up again at a time when many onshore enterprises operate at the marginal break-even cost of production.

National security and jobs
So how does the Great Big Tariff Wall stack up on its primary twin mandates of boosting national security and jobs?

No very well, according to Mr Porcelli.

"Leaving aside the fact that the Pentagon has already come out against these tariffs —ironically on national security grounds— guess who are our biggest suppliers of steel and aluminium? Europe and Canada, respectively," Mr Porcelli said.

"So does the administration actually believe that our two strongest allies represent a national security threat?

"That is so hard to believe that it borders on absurd."

Mr Porcelli argues the whole idea that this is aimed at punishing China is, well, a red herring — so to speak.

"China doesn't even make it into the top 10 in terms of countries we import steel from and the vast majority of our imported aluminium comes from Canada — we import more than four times as much from Canada as we do from China," he said.

As for US jobs, steelmaking is pretty small beer compared to those employed in factories consuming steel.

For every worker employed in steelmaking and mining steel's primary minerals, there are 16 workers in downstream manufacturing.

"The negative impact from these tariffs on those downstream industries from a margin and employment perspective is difficult to predict, but it is rather obvious that the winners/losers ratio seems extremely skewed," Mr Porcelli said.

A graph showing steel related jobs in the US
Australia a small fish in tariff net
So where does that leave Australia? Well we are nowhere near the top 10 in terms of US steel imports and we snuck into equal 10th spot — along with Germany and India — in alumina and aluminium imports at $US300 million last year.

While the US is our second-biggest importer of aluminium goods, it accounts for barely 10 per cent of exports.

China is a far more serious buyer, shovelling in 32 million tonnes, or about three-quarters of Australia's export production.

Australia's biggest steelmaker Bluescope may even be a net beneficiary of the Great Big Trump Tariff Wall.

The company exports about 300,000 tonnes from its Port Kembla mill to the US west coast a year, where its coated and largely sold as its Colorbond product.

That represents about 10 per cent of Bluescope's exports. Not insignificant, but not huge.

A steel mill at Port Kembla.
PHOTO: About 10 per cent of Bluescope's steel production at Port Kembla is exported to the US. (ABC News: Nick McLaren)
Bluescope has invested about $3 billion into its US steel business and employs about 3,000 US citizens in its endeavours.

It is loathe to discuss what the tariff means for it until it sees the details, which are expected to be released next week, but it hopes to win exemptions as it processes its imported steel on US soil, behind the wall.

But the big beneficiary for Bluescope may be its now wholly-owned Northstar steel mill at Delta, Ohio —in the heart of the US rustbelt.

It has been a big part of Bluescopes's remarkable turnaround contributing $145 million — or about a third — of the company's pre-tax first-half earnings announced last month.

It now produces about 2,000 tonnes of US steel a year, more than quadrupling output since Bluescope first took a 50 per cent stake in the business in the 90s.

As a biggish mill employing US workers and producing US steel, Northstar may be a brilliant hedge against any fall in prices caused by several million tonnes of steel washing around the world, trying to find a market outside the US.

Rio Tinto wary
As one of the biggest aluminium exporters to the US through its expensive — and almost company destroying —pre-GFC acquisition of Alcan, Rio Tinto arguably has the most to lose.

The bulk of the old-Alcan smelting operations are unfortunately on the wrong side of the tariff wall, in Canada.

Aluminium ingots stacked up with sun shining through.
PHOTO: Rio Tinto is a big supplier to US manufacturing through Canadian aluminium smelters. (Rob Bennett: bellbayaluminium.com.au)
Rio's management is more than a little concerned, but has yet to see the details of Mr Trump's plans — and whether they are regarded as friends or foes.

"We will continue to engage with US officials to underscore the benefits of the integrated North American aluminium supply chain, including the jobs it supports on each side of the border," Rio said in a statement this morning.

"Aluminium from Canada has long been a reliable and secure input for U.S. manufacturers — including the defence sector," Rio added, playing the national security card.

Having turned around a business that has suffered close to $40 billion in impairments, being locked out of one of its biggest markets would not be a happy outcome for Rio.

The winners?
The immediate winners are pretty easy to identify.

Reuters reported three of the largest American steelmakers — Nucor Corp, United States Steel Corp and Steel Dynamics — collectively added almost $US1billion to their market value, since talk of the Great Big Tariff Wall based surfaced late last week.

Two of the biggest steel users — Ford and General Motors — dropped a combined $US4 billion last night alone.

That's the nature of great big walls. There are two sides to them, generally separating the winners and losers.

[FireNexus]

http://www.abc.net.au/news/2018-03-02/d ... us/9502118

Trump wants to get tough on China with tariffs. Only problem is these tariffs will affect Canada and the EU waaaaay more than China.
Good job Trump. Who needs Putin pulling the strings when Trump is already so incompetent?

I’m pretty sure Canada is unaffected by the tariffs unless he actually cancels NAFTA.

[mr friendly guy]

http://www.abc.net.au/news/2018-03-02/d ... us/9502118

Trump wants to get tough on China with tariffs. Only problem is these tariffs will affect Canada and the EU waaaaay more than China.
Good job Trump. Who needs Putin pulling the strings when Trump is already so incompetent?

I’m pretty sure Canada is unaffected by the tariffs unless he actually cancels NAFTA.

Canada however disagrees with that interpretation since Trudeau is furiously lobbying Washington for an exemption.

http://www.cbc.ca/news/politics/steel-t ... -1.4558967

Canada is seeking an exemption to new U.S. trade restrictions on aluminum and steel, and is vowing to retaliate if it's slapped with any new tariffs.

Prime Minister Justin Trudeau called the proposal "absolutely unacceptable," echoing the phrase used by Foreign Affairs Minister Chrystia Freeland yesterday.

A government official, speaking on background, said Canada believes any new tariffs should not apply to this country due to the highly integrated nature of the North American steel market, and because of the close co-operation between the two countries on defence issues.

A final decision from U.S. President Donald Trump is expected next week. Meanwhile, the Canadian government is discussing what its next steps will be if Washington doesn't order an exemption. For now, officials continue to make Canada's case at every possible level, the official said.

In other words, being unaffected is not guaranteed by NAFTA but Canada will seek an exemption which seems independent of NAFTA.

[Coop D'etat]

Trump is invoking a national security provision to put the tariffs in place. That's why NAFTA doesn't directly prevent it from happening. Its also a good reason for why using this provision is procedurally insane, the Canadian and American defence industries are tightly integrated and it makes no sense to put up a tarif barrier between the countries on that basis (which is probably why they didn't bother to include it under NAFTA, the rules didn't anticipate a aggressive moron like Trump as POTUS).

There are NAFTA dispute resolution mechanisms that can be used against this, but they take time to work through. Probably much longer than these measures will last given the nigh universal opposition from the American political class to this move.

[mr friendly guy]

Mores stuff on Trumps tariff and trade war plan

https://www.vox.com/policy-and-politics ... num-tariff

Trump’s possible trade war with Canada and Europe, explained
His controversial steel and aluminum tariffs will hit the US’s friends, not China.
By Zeeshan Aleem@ZeeshanAleemzeeshan.aleem@vox.com Mar 5, 2018, 8:50am EST

The White House spent the weekend defending sweeping new steel and aluminum tariffs it plans to impose within days, arguing that they’re vital to bringing down the US trade deficit. US allies spent the weekend threatening to retaliate.

Now the prospect of a devastating trade war seems more likely than ever.

A trade war happens when one country puts up a trade barrier, like strict tariffs (which are border taxes on imports), to protect its economy from foreign competition — and another country decides to strike back with its own trade barriers.

In this case, Canada and the European Union are both threatening to retaliate against the US after President Donald Trump announced Thursday that he planned to impose big tariffs on imported steel and aluminum by using an obscure trade law. Those tariffs will hurt the ability of Canada, Germany, and other countries to sell steel and aluminum to the US.

On Friday, European Commission President Jean-Claude Juncker discussed putting tariffs on blue jeans, bourbon, and Harley-Davidson motorcycles, three iconic American exports, in response to Trump’s move. Canadian Prime Minister Justin Trudeau called Trump’s plan “absolutely unacceptable,” and his foreign minister threatened “responsive measures.”

While making the rounds on the Sunday morning talk show circuit, White House trade adviser Peter Navarro sounded unfazed by possible retaliation from US trading partners. He also downplayed concerns that US industries that rely on imported steel and aluminum could pass on increased costs to consumers. “I think the American people are willing to pay a cent-and-a-half more for a 6-pack of beer to have an aluminum and steel industry,” he said on CBS News’s Face the Nation.

Trade wars are a particularly unnerving prospect for many exporters in other countries, since retaliatory actions can spiral out of control. On Saturday Trump tweeted that if the European Union does, in fact, issue retaliatory tariffs, then he will retaliate against their retaliation, by slapping tariffs on European cars. If that happened, it’s possible Europe would once again try to even the score. The cycle could continue indefinitely.

If trade wars continue for a long time, they can have a devastating impact on countries’ economies. They can severely affect entire industries, cause unemployment to spike, and raise the price of vital goods in both or all of the countries involved. And with a president who misguidedly believes trade wars “are good and easy to win,” that worst-case scenario doesn’t seem far-fetched.

The White House isn’t afraid of a trade war. But some Republicans are.
When he appeared on the Sunday talk shows this weekend, Navarro’s message was clear: The Trump administration is very serious about the new border taxes — 25 percent on imported steel, 10 percent on imported aluminum — and it could happen as early as this week.

Navarro confirmed that the administration is not backing down on across-the-board tariffs and would not be making any country-based exceptions.

“As soon as [Trump] starts exempting countries, he has to raise the tariff on everybody else,” Navarro said on Fox News Sunday. “As soon as he exempts one country, his phone starts ringing with the heads of state of other countries.”

He did suggest that there could be exemptions for specific steel or aluminum products that were vital to US businesses, although he offered no specific details.

“There’s a difference between exemptions and country exclusions,” Navarro said on CNN’s State of the Union talk show. “There’ll be an exemption procedure for particular cases ... so that business can move forward, but at this point in time, there’ll be no country exclusions.”

On the whole, Navarro appeared entirely unconcerned about the response from Europe, Canada, and others. But many members of Trump’s own party don’t share that confidence. “You’re punishing the American taxpayers, and you are making a huge mistake,” Sen. Lindsey Graham (R-SC), said on Face the Nation in remarks directed at the president.

Graham said that the tariffs would mark a victory for China. While China is the chief source of the global oversupply of steel and aluminum, it currently ships little steel and aluminum to the US because of previously-imposed trade barriers. “China wins when we fight with Europe,” Graham said.

On Thursday, Sen. Pat Roberts (R-KS), the chair of the Senate agriculture committee, said, “Every time you do this you get retaliation. And agriculture is the number one target. I think this is terribly counterproductive ... and I’m not very happy.”

Trump might not fully understand the consequences of the tariffs
When Trump boasted on Friday that trade wars are “good and easy to win,” he seemed remarkably flippant about a situation that could deeply affect the US and global economy.

If Europe hits American goods like bourbon and motorcycles with huge tariffs, it could decrease demand for those products and lead to US workers losing their jobs. So Trump’s bid to make American steel great again could end up harming iconic American brands like Harley-Davidson and Jack Daniel’s Tennessee whiskey.

If countries like Canada are looking to hit Trump where it hurts, they could target the manufacturing industry or agricultural exports — the kinds of products that hold enormous symbolic value for Trump’s political base.

Trump’s brash policy-making style could also reduce the odds of striking trade deals that he’s after. The UK and the US have both signaled interest in forming a bilateral trade agreement as the UK prepares to leave the European Union in 2019. But analysts say that Trump’s management of these tariffs could make the UK less inclined to pursue that deal with the US. British Prime Minister Theresa May expressed “deep concern” over the tariffs in a phone call with Trump on Sunday, according to a Downing Street spokesperson.

“I’d question the logic of running into a trade deal with a president who sees trade less as a means of achieving mutual prosperity and more an instrument of war,” Sam Lowe, a trade expert at the Centre for European Reform think tank, told the Guardian.

Even without a trade war, the steel and aluminum tariffs will hurt US industries that rely on steel and aluminum to make their products and it will increase their costs. Companies will then have to choose whether or not to swallow those increased costs or pass them on to the consumer. Automakers, the construction industry, the beer industry, retailers, and others have all come out against the tariffs for this reason.

Jeff Schuster, head of forecasting at consultancy LMC Automotive, told Reuters that already-struggling auto companies would fare poorly with increased steel and aluminum prices.

“I don’t think there would be much appetite to absorb the added cost, nor do I think the consumer is interested in doing so,” he said. The result, according to Schuster, will likely lead to a decline in sales.

If Trump goes through with the tariffs as promised, he’ll win the affection of American steel and aluminum producers and impress the parts of his base eager to see him pursue a nationalist agenda on trade.

The question, in the long run, is whether or not it will be worth the costs.

Lets have a look at his trade adviser.

While making the rounds on the Sunday morning talk show circuit, White House trade adviser Peter Navarro sounded unfazed by possible retaliation from US trading partners. He also downplayed concerns that US industries that rely on imported steel and aluminum could pass on increased costs to consumers. “I think the American people are willing to pay a cent-and-a-half more for a 6-pack of beer to have an aluminum and steel industry,” he said on CBS News’s Face the Nation.

Who is this Peter Navarro? He is a China hawk who made the propaganda film, er I mean documentary "Death by China." Last year business insider noted that Navarro was losing influence in the Trump administration especially after Trump said he would get tough on China and then didn't. Also Navarro is an idiot. Observe.

But yes, of course, Navarro gets worse:

The economic argument that trade deficits matter begins with the observation that growth in real GDP depends on only four factors: consumption, government spending, business investment and net exports (the difference between exports and imports). Reducing a trade deficit through tough, smart negotiations is a way to increase net exports—and boost the rate of economic growth.

This simply is not true. The equation, this is the first thing an undergraduate sees when international trade and or GDP are mentioned. The second thing that is pointed out to said undergraduates is that a reduction in imports does not lead to a larger US economy. Nor does an increase in imports lead to a smaller US economy. Because those imports are already included in consumption, investment or government spending. The imports, obviously, go somewhere in the economy. And there're only those three places they can go so that is where they go. Someone buys them as a consumer, a business uses them in their investment plans or the government gets them. So, when we want to measure net economic activity, what we're doing with GDP, then we've got to deduct net imports otherwise we'll be double counting.

As I say, this is the second thing that undergraduates are taught about the GDP equation. Navarro's not getting it which is embarrassing in the person running the trade strategy for the nation.

For those who don't get it, GDP = Consumption + Government spending + Investment + exports - imports. Navarro's argument is, if we buy less from other countries, imports will be less, and since we subtract a smaller number, GDP is bigger and we will grow the American economy.

That would work, if all these components which make up GDP were independent of each other. They are not. Unless an American company is buying stuff from overseas purely to stock it in warehouses and not selling it, Navarro's argument doesn't work. Because American companies are buying stuff from other nations to sell to American consumers, either finished products or the components to make these products to sell, ie increasing consumption.

If we decrease imports, we will also decrease consumption (by a bigger amount because the US firms have to make a profit so they sell the product higher than what they paid to import it). The only way this can be avoided, is if US supply chains can rapidly fill in the gap, and even if they can, there is no guarantee they can do it just as cheap, which would then be put onto the US consumer in the form of higher prices. I didn't need Forbes to tell me that, I could reason this out by just looking at the formula and having a basic understanding of how trade works.

Trump is an idiot advised by another idiot. Fun times.

[mr friendly guy]

https://foreignpolicy.com/2018/03/08/st ... r-a-fight/

Steeling for a Fight
Trump's threatened tariffs won't hurt China. They'll goad the EU to retaliate and could spark a global trade war that won't end well for anyone.
BY PHILIPPE LEGRAIN | MARCH 8, 2018, 4:36 AM

Trade wars are good, and easy to win.” So tweeted President Donald Trump on March 2. His flippant remark may soon be put to the test, as the European Union gears up to retaliate against the punitive tariffs that Trump threatened to slap on U.S. steel and aluminum imports. An EU response would prompt a tit-for-tat blow against U.S. imports of European cars, Trump added on Twitter the following day. China and Canada have also threatened to hit back against Trump’s protectionism. Trade war seems to beckon.

Trump let slip his intention to slap 25 percent import duties on steel and 10 percent tariffs on aluminum for an “unlimited period” at a question-and-answer session with industry representatives on March 1. Of course, it may not come to that. Trump often makes big threats that amount to nothing or are subsequently watered down. He may be talking tough to send a signal to his electoral base, to whom he promised decisive action to bring back American jobs. He was doubtless trying to divert attention from Robert Mueller’s investigation into Russia’s involvement in the 2016 election, as well as from the crises that threaten to engulf his son-in-law and plenipotentiary, Jared Kushner. Trump’s eventual trade measures may end up being less extreme; for instance, his planned announcement Thursday may exclude some countries and target only some steel and aluminum products.

Even if the president softens his line, protectionists now seem to be driving U.S. economic policy.Even if the president softens his line, protectionists now seem to be driving U.S. economic policy. The resignation of Gary Cohn on March 6, Trump’s internationalist chief economic advisor, who was vehemently opposed to the tariffs, suggests that the economic nationalists in the White House have won the debate. And if the threatened blanket tariffs are indeed imposed, on the spurious pretext that imports of steel from NATO allies such as Canada and Germany threaten America’s “national security,” the consequences could be severe. Reality TV politics could give way to real trade conflict.
The immediate economic impact of the tariffs would be significant. They would affect $46 billion of U.S. imports, some 2 percent of total U.S. goods imports. Perversely, the United States itself would be hit hardest. While only about 140,000 Americans work in the steel industry, some 17 million are employed in steel-using industries. More expensive steel would push up those firms’ costs, making them less competitive globally and increasing prices for American consumers. President George W. Bush imposed less extreme steel tariffs in 2002; they ended up costing 200,000 jobs, a study found. (Bush’s tariffs affected only some steel products and exempted Canada, Mexico, and others. They were lifted a year later after the EU and other countries challenged their legality at the World Trade Organization.)

Trump’s tariffs ostensibly aim to target China, which the Trump administration views as a strategic competitor and military threat. Yet they would leave Beijing largely unscathedTrump’s tariffs ostensibly aim to target China, which the Trump administration views as a strategic competitor and military threat. Yet they would leave Beijing largely unscathed; China exports only 0.2 percent of its total steel output to the United States. Moreover, China ranks eleventh among sources of U.S. steel imports, accounting for a 2 percent share of the total. While China is the fourth-biggest aluminum exporter to the United States, the $3.1 billion of aluminum it exported accounts for a tiny fraction of the $462.6 billion worth of total goods it exported to the United States in 2016. For China, Trump’s tariffs would be scarcely a scratch.
But they would hurt many other countries. If you break down the value of U.S. steel imports in 2017 by country, you get a roll-call of American allies: EU (21.4 percent), Canada (17.6 percent), South Korea (9.6 percent), and Mexico (8.6 percent). Canada in particular is closely integrated with the U.S. defense industry. No wonder the Pentagon is aghast.

The economic costs would multiply if other countries retaliated. The European Commission is already preparing to hit back. The EU exported $6.5 billion of steel and $1.4 billion of aluminum to the United States in 2017, but it is initially planning to impose sanctions against only $3.5 billion of U.S. imports.

To that end, the Commission has presented EU governments with a list of more than 100 products that could be targeted, chosen for their political sensitivity. In addition to steel, aluminum, and agricultural produce from farm states that voted for Trump, these include Levi’s jeans, bourbon whiskey (principally from Kentucky, the home state of Senate Majority Leader Mitch McConnell), and Harley-Davidson motorcycles and Wisconsin cheese (from the home state of House Speaker Paul Ryan.) The pressure seems to be working: “We are extremely worried about the consequences of a trade war and are urging the White House to not advance with this plan,” Ryan’s spokeswoman said.

For sure, retaliation would be painful for EU consumers and businesses that rely on U.S. products. Like real wars, trade wars cause casualties on both sides. But EU policymakers feel compelled to stand up to Trump’s bullying. For once, European Commission President Jean-Claude Juncker got it right when he said: “This is basically a stupid process, the fact that we must to do this, but we have to.”

Trump seems to think that the size of the U.S. market and its trade deficit allow it to play hardball — in 2017, the United States had a $151 billion goods trade deficit with the EU — but the EU and other governments feel that they have more to lose from giving in to Trump’s bullying. While Trump seems to thrive on creating chaos, this is unlikely to be productive in trade diplomacy.

The biggest danger is that if nobody is willing to back down, this tit-for-tat process could quickly escalate. Trump’s threatened retaliation against European cars would take the conflict to another level. The U.S. imported more than $43 billion of cars from the EU in 2016 — a tenth of its total imports from the EU — $22.2 billion of which came from Germany alone. How might the EU respond to that?


Ultimately, a trade war would cost jobs, push up inflation (and potentially interest rates), and harm economic growth.Ultimately, a trade war would cost jobs, push up inflation (and potentially interest rates), and harm economic growth. It would deal a further blow to political relations between the United States and its allies, which have already been undermined by Trump’s “America First” rhetoric, disdain for liberal values, and transactional approach to foreign policy. And it would shatter the informal alliance among the United States, European Union, and Japan to tackle what they see as unfair Chinese trade practices while allowing China to pose as a defender of the international trading system.
A trade war between the U.S. and the EU would be particularly thorny for a British government consumed by Brexit. It would underline the value of being part of a big trading bloc capable of facing up to Trump’s bullying, and thus the cost to the United Kingdom of exiting the EU in March 2019. It would make an ambitious post-Brexit trade deal with the United States even less likely. And it would make the United Kingdom acutely vulnerable to U.S. pressure as it seeks to renegotiate bilaterally all sorts of treaties that the EU previously negotiated on its behalf with the U.S. government. Predictably, Washington is already playing hardball in renegotiating the Open Skies agreement that governs transatlantic air travel.

Trump is also seeking to use the steel tariffs as leverage in the ongoing renegotiation of the North American Free Trade Agreement with Canada and Mexico. But the U.S. is demanding terms that its partners deem unacceptable, including a requirement that 50 percent of the content of cars made in NAFTA come from the United States.

Steel protectionism may also be contagious. There is a glut of steel globally, and the EU is preparing safeguard measures in the event of a surge of steel and aluminum imports from other countries as a result of the Trump tariffs.

The EU and others are also planning to challenge Trump’s tariffs at the WTO. While WTO rules allow countries to restrict trade on national security grounds, this exception is designed for exceptional times such as war. The EU has a strong case since Trump himself has repeatedly justified his threatened tariffs on economic rather than national security grounds.

But this is a lose-lose scenario for the WTO. It may be loath to be seen to trample on supposed U.S. national security concerns, but if it ruled in the Washington’s favor, this would provide carte blanche for other countries to spuriously curb imports on national security grounds. If it ruled against Trump, his administration would probably ignore the ruling, and might even pull out of the WTO, as it has previously threatened to do. The former would leave the U.S. tariffs in place, with legal sanction for the retaliatory tariffs by the EU and other trading partners deemed to have suffered harm. The latter would blow a huge hole in the institution that provides peaceful arbitration for international trade disputes.

Trade wars are never good. Nor do they have winners, let alone easy ones. And they certainly won’t make America great again.

[Simon_Jester]

For those who don't get it, GDP = Consumption + Government spending + Investment + exports - imports. Navarro's argument is, if we buy less from other countries, imports will be less, and since we subtract a smaller number, GDP is bigger and we will grow the American economy.

That would work, if all these components which make up GDP were independent of each other. They are not. Unless an American company is buying stuff from overseas purely to stock it in warehouses and not selling it, Navarro's argument doesn't work. Because American companies are buying stuff from other nations to sell to American consumers, either finished products or the components to make these products to sell, ie increasing consumption.

If we decrease imports, we will also decrease consumption (by a bigger amount because the US firms have to make a profit so they sell the product higher than what they paid to import it). The only way this can be avoided, is if US supply chains can rapidly fill in the gap, and even if they can, there is no guarantee they can do it just as cheap, which would then be put onto the US consumer in the form of higher prices. I didn't need Forbes to tell me that, I could reason this out by just looking at the formula and having a basic understanding of how trade works.

Trump is an idiot advised by another idiot. Fun times.

This is pretty much a reprise of 16th century mercantilism, only without the gold standard: "The way to be rich is to make sure all the money piles up in our country and never leaves it."