Trump says U.S. to impose tariffs on steel, aluminum imports

[Hydrogen]

WASHINGTON (Reuters) - U.S. President Donald Trump said on Thursday the United States would impose tariffs of 25 percent on steel imports and 10 percent on imported aluminum next week.

At a meeting with U.S. industry officials at the White House, Trump vowed to rebuild American steel and aluminum industries, saying they had been treaded unfairly by other countries for decades.

The move is likely to increase tensions with China, whose top trade official Lui He is in Washington for trade talks.

An early morning tweet from Trump that said the steel and aluminum sectors needed protecting from unfair trade drove shares in domestic industries sharply higher.

AK Steel Holding (AKS.N) was up 2.8 percent, U.S. Steel Corp (X.N) was up 2.3 percent and Nucor (NUE.N) rose 1 percent. By contrast, industrial stocks such as Boeing fell, with traders citing tariffs, which would hit manufacturers.

The administration says duties would protect U.S. industry, but critics say they would raise costs for industry and fail to deliver on a campaign pledge to boost domestic jobs.

Trump tweeted on Thursday that American steel and aluminum companies needed“free, fair and smart trade”. Trump has indicated he favors a duty of 24 percent on steel imports.

The administration has also cited national security interests for its action, saying the United States needs domestic supply for its tanks and warships. The Department of Defense has recommended targeted steel tariffs and a delay in aluminum duties.

Although China only accounts for two percent of U.S. steel imports, its massive industry expansion has helped produce a global glut of steel that has driven down prices.

China has indicated it could retaliate against U.S. steel tariffs by targeting imports of U.S. agricultural commodities, such as soybeans of which America is the largest supplier.

Trade tensions between the United States and China have risen since Trump took office in 2017 and the administration is also pushing on what it regards as forced technology transfers to China.

Shares of Asian steel producers such as South Korea’s POSCO (005490.KS) and Nippon Steel (5401.T) fell overnight.

FEW MORE JOBS FROM TARIFFS
While American steelmakers have lost three quarters of their jobs between 1962 and 2005, a major study by the American Economic Association showed that much of this had been due to improved production technology as output per worker rose fivefold.

“Thus, even if trade protection leads to increased domestic production, increases in employment may be far less than many hope,” a report from the highly-regarded independent Econofact economist network said last week.

Consumers of steel and aluminum have lobbied hard against the tariffs. Econofact said in its report that two million jobs were in industries that use steel“intensively”, including auto parts, household appliances, farm machinery and oil equipment.

Jobs in the consuming industries are concentrated in California, Texas, the Northeastern and Midwestern states that comprise the rust belt and states in the Southeast.

“Across many states, the number of jobs adversely affected in these steel-using industries could far exceed any steel jobs saved,” Econofact warned.

“Past experience also shows that unilateral action like Section 232 tariffs will invite retaliation — the Bush-era steel tariffs led many countries to target politically sensitive U.S. exports like Florida oranges and North Carolina textiles.”

https://www.reuters.com/article/us-usa-trade/trump-says-u-s-to-impose-tariffs-on-steel-aluminum-imports-idUSKCN1GD3QO

Its so bizarre to see Donald Trump be the only american politician in office who seems to care about creating jobs or protecting american interests. I'm not saying that Donald Trump is right about everything. But he does seem to be the only one making a legitimate effort to improve circumstances in this country. Costco and a lot of places are hiring now in my area. The economy seems to be improving. I don't know if one man can make a difference but the US economy does seem to be improving and I wonder what is causing it.

Also when I say the US economy is improving, I know that the DOW stock market average is dropping. If anyone wants I can dig through my post history and show you where I predicted this would happen weeks ago.   There may be an explanation for that and we might have discussed it awhile ago.

[Mometaskers]

Its so bizarre to see Donald Trump be the only american politician in office who seems to care about creating jobs or protecting american interests. I'm not saying that Donald Trump is right about everything. But he does seem to be the only one making a legitimate effort to improve circumstances in this country. Costco and a lot of places are hiring now in my area. The economy seems to be improving. I don't know if one man can make a difference but the US economy does seem to be improving and I wonder what is causing it.

Also when I say the US economy is improving, I know that the DOW stock market average is dropping. If anyone wants I can dig through my post history and show you where I predicted this would happen weeks ago.   There may be an explanation for that and we might have discussed it awhile ago.

I don't live in the US but how do you think this would affect prices there? I mean, the automobile industry seem to be a heavy user of those metals and from what I've gathered Americans seem to NEED cars. Would the consumers be fine with the price increases?

[jaysabi]

Its so bizarre to see Donald Trump be the only american politician in office who seems to care about creating jobs or protecting american interests. I'm not saying that Donald Trump is right about everything. But he does seem to be the only one making a legitimate effort to improve circumstances in this country. Costco and a lot of places are hiring now in my area. The economy seems to be improving. I don't know if one man can make a difference but the US economy does seem to be improving and I wonder what is causing it.

Also when I say the US economy is improving, I know that the DOW stock market average is dropping. If anyone wants I can dig through my post history and show you where I predicted this would happen weeks ago.   There may be an explanation for that and we might have discussed it awhile ago.

I don't live in the US but how do you think this would affect prices there? I mean, the automobile industry seem to be a heavy user of those metals and from what I've gathered Americans seem to NEED cars. Would the consumers be fine with the price increases?

No, of course not. Anyone who can hold a sophisticated thought in their brain realizes that a trade war is bad for the economy and that the trade off for protecting steel jobs is higher prices all consumers have to pay for those products. It's government interference in the economy, which is never efficient, never works as intended, and never comes without retaliatory consequences. We have a large body of evidence showing the effects of tariffs and trade wars, and despite all this, some simpleton thinks "trade wars are good and easy to win." Well, they're not and they're not. That's why the world at large has moved towards free trade, because it's more efficient to let the low cost producers produce goods they have the advantage in producing, and have other economies specialize in something else. That costs some jobs, yes, but consumers benefit more and the economy experiences more growth as a result. Protectionism never worked, it spawned shortages, price inefficiencies, and nationalist tendencies that sparked wars. That's why the stock markets dropped all around the world at the announcement that the United States was set to repeat the mistakes of the past. The MAGA munchers are on the march!

[jmlona]

I think that the article hints at some of the major problems with this in seeing that stocks in steel companies greatly increased but then those in companies like boeing fell.

While this will benefit the steel industry it will increase the costs of manufacturing for many other companies.

 Potentially creating jobs in one industry that are in essence taken from another.

[justin86]

I think that is nothing to do with crypto, it affects other assets' prices for sure so maybe coins as well but I think crypto total market cap is so low that it can go to nowhere but moon in the long term  

[Hydrogen]

No, of course not. Anyone who can hold a sophisticated thought in their brain realizes that a trade war is bad for the economy and that the trade off for protecting steel jobs is higher prices all consumers have to pay for those products.

I'm not a fan of the "one true faith" mentality which says there can only be one correct stance or view on a topic and everyone else is doomed to burning in hell as infidels / heretics.

I think its fair to say the chinese steel industry is extremely similar to BitMain in the ASIC industry. If Donald Trump proposed raising taxes against BitMain, miners would complain and say it would increase the cost of mining. That would be correct over the short term. There would be higher prices for consumers initially.

But over the long term, higher taxes against BitMain could have potential positive effects. Higher tariffs on BitMain could introduce greater market competition and decentralize the ASIC market, which could have long term benefits for consumers and miners.

The chinese steel industry is the same. The short term likelihood is tariff and trade wars. Potential long term benefits are the centralized chinese steel industry becoming more decentralized, introducing competition in the market which has overall long term benefits.

I would be glad if anyone who believes there's only one "correct" perspective here could point out flaws in my reasoning.    

It's government interference in the economy, which is never efficient, never works as intended, and never comes without retaliatory consequences. We have a large body of evidence showing the effects of tariffs and trade wars, and despite all this, some simpleton thinks "trade wars are good and easy to win."

I think there could be a double standard here.

Tariffs are "evil" as they're "government interference". Based on that reasoning tax hikes on sugary beverages, alcohol, tobacco, marijuana or bitcoin are also "government interference" and therefore "evil" are they not?

Well, they're not and they're not. That's why the world at large has moved towards free trade, because it's more efficient to let the low cost producers produce goods they have the advantage in producing, and have other economies specialize in something else.

Having a steel industry centralized and heavily monopolized by china doesn't necessarily represent the most efficient production method though?

That's like saying BitMain dominating the ASIC industry is the most efficient method of ASIC production?

That costs some jobs, yes, but consumers benefit more and the economy experiences more growth as a result. Protectionism never worked, it spawned shortages, price inefficiencies, and nationalist tendencies that sparked wars. That's why the stock markets dropped all around the world at the announcement that the United States was set to repeat the mistakes of the past. The MAGA munchers are on the march!

Hmm. For some reason I get an impression arguing against introducing competition in the steel industry by raising tariffs is a form of protectionism for china's steel monopoly.

Trump's steel tariffs promote free markets and greater competition by allowing other steel producers to be more competitive in american markets. I don't know if that's a form of protectionism?

(Merited. I know a lot of people disagree with me. You're the only one willing to talk about it. Have to credit you for that.)

[jaysabi]

No, of course not. Anyone who can hold a sophisticated thought in their brain realizes that a trade war is bad for the economy and that the trade off for protecting steel jobs is higher prices all consumers have to pay for those products.

I'm not a fan of the "one true faith" mentality which says there can only be one correct stance or view on a topic and everyone else is doomed to burning in hell as infidels / heretics.

I think its fair to say the chinese steel industry is extremely similar to BitMain in the ASIC industry. If Donald Trump proposed raising taxes against BitMain, miners would complain and say it would increase the cost of mining. That would be correct over the short term. There would be higher prices for consumers initially.

But over the long term, higher taxes against BitMain could have potential positive effects. Higher tariffs on BitMain could introduce greater market competition and decentralize the ASIC market, which could have long term benefits for consumers and miners.

The chinese steel industry is the same. The short term likelihood is tariff and trade wars. Potential long term benefits are the centralized chinese steel industry becoming more decentralized, introducing competition in the market which has overall long term benefits.

I would be glad if anyone who believes there's only one "correct" perspective here could point out flaws in my reasoning.    

You're setting up a strawman in trying to paint it as anyone who disagrees with your idea must believe there is "one true faith" or whatever that means. All opinions aren't created equal, and an opinion on economics is only as good as the the policies it supports. In forming those opinions, what should matter most is evidence and sound economic theory, and both strongly come down on the side of tariffs being more destructive to the economy than beneficial. Steel tariffs will benefit the US steel industry at the cost of every industry that uses steel by raising the price of all steel available to them. Tariffs don't make US steel cheaper, it makes all non-US steel more expensive in order to make US steel more competitive by comparison. So first, you have widespread price increases for all industries that use steel and all consumers who buy steel products. Second, you have retaliatory measures by other governments that will target US industries for tariffs, thereby offsetting any benefit to the US steel industry by making US goods overseas even less competitive than they already are. This is not a secret, Canada (our largest trading partner, which is important), Europe and China have already said they will impose retaliatory tariffs. This is going to affect US GDP negatively far more than protecting steel jobs in the US will positively affect GDP. The market knows this will happen, that's why all major indexes around the world dropped upon Trump's announcement. Economists are stunned, because protectionist trade policies was a problem they thought we "solved" a long time ago. The fact that Trump is cavalierly pursuing policies that have outright failed in the past is a pretty big shock to the system. Finally, Bush tried emergency steel tariffs to prop up the US steel industry in 2002, and at the time, the Congressional committee investigating the expected impact of the tariffs reported that they expected 8 jobs to be lost for every steel job protected.
Source: https://www.gpo.gov/fdsys/pkg/CHRG-107hhrg81372/html/CHRG-107hhrg81372.htm

Studies later on the impact found those tariffs resulted in a net loss for the economy by temporarily boosting the US steel industry and ultimately reducing overall GDP and also resulting in a net loss of approximately 200,000 jobs.  
Source: http://onlinelibrary.wiley.com/doi/10.1111/j.1467-9701.2005.00722.x/abstract
Source: http://www.tradepartnership.com/pdf_files/2002jobstudy.pdf

Also, the WTO ruled against the Bush US steel tariffs and imposed a $2 billion sanction if the tariffs were not withdrawn, which the US refused, but ultimately relented when Europe implemented tariffs on a range of US industries in retaliation.

It's government interference in the economy, which is never efficient, never works as intended, and never comes without retaliatory consequences. We have a large body of evidence showing the effects of tariffs and trade wars, and despite all this, some simpleton thinks "trade wars are good and easy to win."

I think there could be a double standard here.

Tariffs are "evil" as they're "government interference". Based on that reasoning tax hikes on sugary beverages, alcohol, tobacco, marijuana or bitcoin are also "government interference" and therefore "evil" are they not?

Yeah, there's no inconsistency here. Government shouldn't be interfering in the economy to produce artificial winners and losers because it's more inefficient than letting the market decide what goods/services the market wants, and it creates crony capitalism where the politically connected elites use the government to advance their own ambitions, which is undemocratic.

Well, they're not and they're not. That's why the world at large has moved towards free trade, because it's more efficient to let the low cost producers produce goods they have the advantage in producing, and have other economies specialize in something else.

Having a steel industry centralized and heavily monopolized by china doesn't necessarily represent the most efficient production method though?

That's like saying BitMain dominating the ASIC industry is the most efficient method of ASIC production?

That costs some jobs, yes, but consumers benefit more and the economy experiences more growth as a result. Protectionism never worked, it spawned shortages, price inefficiencies, and nationalist tendencies that sparked wars. That's why the stock markets dropped all around the world at the announcement that the United States was set to repeat the mistakes of the past. The MAGA munchers are on the march!

Hmm. For some reason I get an impression arguing against introducing competition in the steel industry by raising tariffs is a form of protectionism for china's steel monopoly.

Trump's steel tariffs promote free markets and greater competition by allowing other steel producers to be more competitive in american markets. I don't know if that's a form of protectionism?

(Merited. I know a lot of people disagree with me. You're the only one willing to talk about it. Have to credit you for that.)

I don't see tariffs as promoting free market. By definition, free market means laissez-faire, which means no interference. Do you think that tariffs are non-interference? It's an intervention. So by definition it can't be free market, and it doesn't make the market more competitive, it just raises all prices to artificially keep in business a high cost producer. The most accurate thing we can call it is protectionist. It may logically follow that making the US steel industry more competitive by making everyone else's steel more expensive does increase competition, but not because it makes anyone more competitive, it just artificially increases the number of producers. If it was a naturally competitive market, competition would result in cheaper prices, but we actually have the inverse here, which is obviously a perversion. The question you should be asking therefore is if the detriments of such a policy are worth the price. After all, we could have a completely isolationist trade policy, thereby boosting the consumption of US-made goods to 100%, but it would also decimate the economy and greatly reduce the amount of affordable goods available to US consumers because the US cannot produce itself everything the US consumes. Not competing with China on everything isn't necessarily a problem; the US isn't competitive with China in all sorts of industries due to the fact that the cost of labor is a fraction of what it is in the US. China itself is having problems losing jobs to yet even cheaper labor nations that are yet underdeveloped still. To use your bitmain analogy here, it may be that having Bitmain dominate the ASIC industry may be the most efficient method of ASIC production. Whoever can produce the cheapest and most efficiently will naturally rise to the top, that's just how free markets work. It may be bad for all other producers of ASICs if they can't produce as efficiently, but banning Bitmain ASICs will artificially raise the price consumers pay for ASICs just to benefit a small number of producers who, if they can't produce efficiently, probably don't deserve to be in business.

In this case, a steel tariff is a tax ultimately paid by consumers through higher prices which benefits the US steel industry, and it comes with the added detriments of slowing economic activity and also of retaliatory tariffs that will further depress US trade and therefore US GDP. And because Trump is an unsophisticated statesman who will see this as a loss, is likely to respond with other (what he considers) "strong" measures that will further have unintended consequences.

I'll merit back because you're promoting good discussion.

[Proton2233]

There was information that trump made this statement in a fit of anger. He's nervous about investigating his ties to the Russians. I still don't understand how Americans could choose such an idiot as President. Perhaps under the pretext of trade wars Russians want to quarrel America with Europe. Against the backdrop of these news, Europe is softening legislation on cryptocurrencies. Maybe we will receive dividends from this confrontation?

[Mometaskers]

Its so bizarre to see Donald Trump be the only american politician in office who seems to care about creating jobs or protecting american interests. I'm not saying that Donald Trump is right about everything. But he does seem to be the only one making a legitimate effort to improve circumstances in this country. Costco and a lot of places are hiring now in my area. The economy seems to be improving. I don't know if one man can make a difference but the US economy does seem to be improving and I wonder what is causing it.

Also when I say the US economy is improving, I know that the DOW stock market average is dropping. If anyone wants I can dig through my post history and show you where I predicted this would happen weeks ago.   There may be an explanation for that and we might have discussed it awhile ago.

I don't live in the US but how do you think this would affect prices there? I mean, the automobile industry seem to be a heavy user of those metals and from what I've gathered Americans seem to NEED cars. Would the consumers be fine with the price increases?

No, of course not. Anyone who can hold a sophisticated thought in their brain realizes that a trade war is bad for the economy and that the trade off for protecting steel jobs is higher prices all consumers have to pay for those products. It's government interference in the economy, which is never efficient, never works as intended, and never comes without retaliatory consequences. We have a large body of evidence showing the effects of tariffs and trade wars, and despite all this, some simpleton thinks "trade wars are good and easy to win." Well, they're not and they're not. That's why the world at large has moved towards free trade, because it's more efficient to let the low cost producers produce goods they have the advantage in producing, and have other economies specialize in something else. That costs some jobs, yes, but consumers benefit more and the economy experiences more growth as a result. Protectionism never worked, it spawned shortages, price inefficiencies, and nationalist tendencies that sparked wars. That's why the stock markets dropped all around the world at the announcement that the United States was set to repeat the mistakes of the past. The MAGA munchers are on the march!

Well his election base were asking for this, he won hugely in the rust belt. Countries affected by the tariff would definitely retaliate, I suppose Americans might lose some jobs over jobs they gain in steel and aluminum manufacturing.

I don't have much economic knowledge but what I'm worrying is if this would spill over to other countries. We're already having a hard time in our country as prices has increased from a new tax law.

[jaysabi]

Its so bizarre to see Donald Trump be the only american politician in office who seems to care about creating jobs or protecting american interests. I'm not saying that Donald Trump is right about everything. But he does seem to be the only one making a legitimate effort to improve circumstances in this country. Costco and a lot of places are hiring now in my area. The economy seems to be improving. I don't know if one man can make a difference but the US economy does seem to be improving and I wonder what is causing it.

Also when I say the US economy is improving, I know that the DOW stock market average is dropping. If anyone wants I can dig through my post history and show you where I predicted this would happen weeks ago.   There may be an explanation for that and we might have discussed it awhile ago.

I don't live in the US but how do you think this would affect prices there? I mean, the automobile industry seem to be a heavy user of those metals and from what I've gathered Americans seem to NEED cars. Would the consumers be fine with the price increases?

No, of course not. Anyone who can hold a sophisticated thought in their brain realizes that a trade war is bad for the economy and that the trade off for protecting steel jobs is higher prices all consumers have to pay for those products. It's government interference in the economy, which is never efficient, never works as intended, and never comes without retaliatory consequences. We have a large body of evidence showing the effects of tariffs and trade wars, and despite all this, some simpleton thinks "trade wars are good and easy to win." Well, they're not and they're not. That's why the world at large has moved towards free trade, because it's more efficient to let the low cost producers produce goods they have the advantage in producing, and have other economies specialize in something else. That costs some jobs, yes, but consumers benefit more and the economy experiences more growth as a result. Protectionism never worked, it spawned shortages, price inefficiencies, and nationalist tendencies that sparked wars. That's why the stock markets dropped all around the world at the announcement that the United States was set to repeat the mistakes of the past. The MAGA munchers are on the march!

Well his election base were asking for this, he won hugely in the rust belt. Countries affected by the tariff would definitely retaliate, I suppose Americans might lose some jobs over jobs they gain in steel and aluminum manufacturing.

I don't have much economic knowledge but what I'm worrying is if this would spill over to other countries. We're already having a hard time in our country as prices has increased from a new tax law.

It is spilling over to other countries, and already other industries. Canada, Europe and China said they would introduce retaliatory tariffs in response to the Trump tariffs, and Trump now has said that he would introduce more tariffs on EU cars imported to the US in response to that. So now we have an escalating situation of retaliatory tariffs that is threatening to grow even larger and affect more industries. The larger this grows, the worse it will be. The original steel tariffs are already having a direct effect (aside from the retaliatory tariffs) in that Electrolux has now halted a $250 million investment and expansion plan that was underway in Tennessee:  https://www.usatoday.com/story/money/business/2018/03/05/electrolux-halts-250-million-project-springfield-tenn-after-tariff-announcement/394409002/

Trump made a lot of dumb promises to a lot of people who don't understand that you don't get anything for free, and the rest of the country is going to pay the price for him trying to keep those promises. The price of the steel tariffs will touch far more people in a negative way than the steel tariffs help end up helping in a positive way.

[mrcash02]

Trump made a lot of dumb promises to a lot of people who don't understand that you don't get anything for free, and the rest of the country is going to pay the price for him trying to keep those promises. The price of the steel tariffs will touch far more people in a negative way than the steel tariffs help end up helping in a positive way.

Wasn't Obama who did this promising free healthcare for everyone?

Trump is being strategical, he wants to strengthen the national industry and decrease other countries influence over USA, especially China.
I can't say if it will work or not, but I think it's too early to have sure that it will fail...

Most countries threatening retaliatory tariffs war against USA can't do this for real, because they need USA more than USA needs them!

[jaysabi]

Trump made a lot of dumb promises to a lot of people who don't understand that you don't get anything for free, and the rest of the country is going to pay the price for him trying to keep those promises. The price of the steel tariffs will touch far more people in a negative way than the steel tariffs help end up helping in a positive way.

Wasn't Obama who did this promising free healthcare for everyone?

Trump is being strategical, he wants to strengthen the national industry and decrease other countries influence over USA, especially China.
I can't say if it will work or not, but I think it's too early to have sure that it will fail...

Most countries threatening retaliatory tariffs war against USA can't do this for real, because they need USA more than USA needs them!

I don't know that Obama ever promised free healthcare to anyone. A program that attempts to reign in exploding cost of healthcare is not the same thing as free healthcare, so that's not a like comparison.

As for the tariffs and retaliatory tariffs, yes, we already know this will fail. If the objective is to protect the steel industry, it might help a little. If the objective is to protect as many US jobs as possible, we already know it's a lost battle. You cannot have steel tariffs that protect the steel industry and have no external consequences. The rest of the countries absolutely can (and will) retaliate and have already begun to do so. Tariffs don't happen in a vacuum, and there will be a price to pay for this just like there has been every other time it has happened.

[BobK71]

... Anyone who can hold a sophisticated thought in their brain realizes that a trade war is bad for the economy and that the trade off for protecting steel jobs is higher prices all consumers have to pay for those products. It's government interference in the economy, which is never efficient, never works as intended, and never comes without retaliatory consequences. We have a large body of evidence showing the effects of tariffs and trade wars, and despite all this, some simpleton thinks "trade wars are good and easy to win." Well, they're not and they're not.

I always tell myself, when enough people feel strongly about something, the situation might have something important to teach us, regardless of whether those people are right in precisely what they say.

All of this theory is fine, until you realize that it's based on the assumption that money and finance are also a free market.  They are not.  The manipulation of money by the elites distorts price signals, and the downstream effects are global imbalances of trade and finance, leading to the hollowing out of the Western middle class and political rebellions such as Brexit and Trump.

That's why the world at large has moved towards free trade, because it's more efficient to let the low cost producers produce goods they have the advantage in producing, and have other economies specialize in something else. That costs some jobs, yes, but consumers benefit more and the economy experiences more growth as a result. Protectionism never worked, it spawned shortages, price inefficiencies, and nationalist tendencies that sparked wars. That's why the stock markets dropped all around the world at the announcement that the United States was set to repeat the mistakes of the past. The MAGA munchers are on the march!

The world is unfortunately addicted to the financial distortions coming from, and being protected by, what the elites call 'free trade.'  Addiction is a good word because, (1) the status quo is not sustainable, and (2) reform is painful, and will get more painful as time goes on, and has already become very painful (which is why there's such an outcry among the establishment against any disruption of 'free trade.')

For details, please see my post The Misunderstandings of 'Free Trade'

[jaysabi]

... Anyone who can hold a sophisticated thought in their brain realizes that a trade war is bad for the economy and that the trade off for protecting steel jobs is higher prices all consumers have to pay for those products. It's government interference in the economy, which is never efficient, never works as intended, and never comes without retaliatory consequences. We have a large body of evidence showing the effects of tariffs and trade wars, and despite all this, some simpleton thinks "trade wars are good and easy to win." Well, they're not and they're not.

I always tell myself, when enough people feel strongly about something, the situation might have something important to teach us, regardless of whether those people are right in precisely what they say.

All of this theory is fine, until you realize that it's based on the assumption that money and finance are also a free market.  They are not.  The manipulation of money by the elites distorts price signals, and the downstream effects are global imbalances of trade and finance, leading to the hollowing out of the Western middle class and political rebellions such as Brexit and Trump.

That's why the world at large has moved towards free trade, because it's more efficient to let the low cost producers produce goods they have the advantage in producing, and have other economies specialize in something else. That costs some jobs, yes, but consumers benefit more and the economy experiences more growth as a result. Protectionism never worked, it spawned shortages, price inefficiencies, and nationalist tendencies that sparked wars. That's why the stock markets dropped all around the world at the announcement that the United States was set to repeat the mistakes of the past. The MAGA munchers are on the march!

The world is unfortunately addicted to the financial distortions coming from, and being protected by, what the elites call 'free trade.'  Addiction is a good word because, (1) the status quo is not sustainable, and (2) reform is painful, and will get more painful as time goes on, and has already become very painful (which is why there's such an outcry among the establishment against any disruption of 'free trade.')

For details, please see my post The Misunderstandings of 'Free Trade'

Your theory is that if enough ignorant people believe something strongly enough, it's probably important to learn from them? That's paraphrasing, but I think an accurate restatement of what you said. The masses used to believe in all manner of nonsense ranging from spirits to possession to human sacrifice, and that doesn't make any of those beliefs worth anything. I don't view economic ignorance any differently. The great things about facts is that they're true whether or not you believe them. Tyranny of the majority doesn't make something objectively true, it just makes the use of force to impose it more socially acceptable, which is an entirely different discussion.

I've been following the other thread already. I haven't posted anything in response because it's far too conspiratorial to get involved with. There's a lot of high level generalizations that are too vague to even really respond to without responding with equally high level generalizations that are basically just the opposite, and there's hardly a point to that. So I'll continue reading it to see if I have anything to add to the discussion, but thus far I don't.

Whether or not "money and finance are also a free market" doesn't seem to have any bearing in this thread. This discussion is about whether or not steel tariffs as proposed by Trump are going to do more good or more bad, and the details of that are specifically addressed in the posts above. Whether money and finance are free or not, we know with reasonably certainty exactly how steel tariffs will play out under the system as it is.

[Beerwizzard]

Well, it seems that I'm a bit late but let me put my 5 cents to your conversation.

Protectionism never worked, it spawned shortages, price inefficiencies, and nationalist tendencies that sparked wars.

I'm a dedicated follower of the free market but I would disagree with you here. China has built the entire automotive industry based on protectionism and it feels fine. Italy had to protect its textile industry by increasing the import taxes, otherwise it could be already dead. And you can fund much more examples of protectionism that worked. It will probably fail in a very long term bur in a short terms it might take its place (unfortunately we don't live in a single ancap society ). Every case is unique.

P.S. US always had a huge amount of different regulations and restrictions but everythins was fine. This is far not the biggest problem of that country.

[ganlianshifu1]

Trump's actions have been strongly opposed by many countries in the world!

This behavior is harmful to the global steel industry and seriously damages the interests of consumers of steel products, especially American consumers. It is harmful to people's behavior.

[alyssa85]

I don't live in the US but how do you think this would affect prices there? I mean, the automobile industry seem to be a heavy user of those metals and from what I've gathered Americans seem to NEED cars. Would the consumers be fine with the price increases?

Global prices for steel are already at rock bottom thanks to overproduction by China. What Trumps actions will mean is that some of the Chinese producers will go bust unless they can find someone else to buy their steel from them. (We might see them try to dump their steel on Europe, and it will be interesting to see Europe's response to that given they've been bleating so much about Trump's actions).

[BobK71]

Your theory is that if enough ignorant people believe something strongly enough, it's probably important to learn from them? That's paraphrasing, but I think an accurate restatement of what you said. The masses used to believe in all manner of nonsense ranging from spirits to possession to human sacrifice, and that doesn't make any of those beliefs worth anything. I don't view economic ignorance any differently. The great things about facts is that they're true whether or not you believe them. Tyranny of the majority doesn't make something objectively true, it just makes the use of force to impose it more socially acceptable, which is an entirely different discussion.

Believe me, I have no theory that says believe in falsehoods.  But if a lot of people believe strongly in something that I don't, I'd like to look around a little and see if something is wrong with the entire framework from which I approach some issues, even if it means I won't agree fully with those people in the end.  This is fully relevant to the current topic.

I've been following the other thread already. I haven't posted anything in response because it's far too conspiratorial to get involved with. There's a lot of high level generalizations that are too vague to even really respond to without responding with equally high level generalizations that are basically just the opposite, and there's hardly a point to that. So I'll continue reading it to see if I have anything to add to the discussion, but thus far I don't.

So, let me get this straight.  You think my writings are too vague or general.  Fair point.  I try not to write too long sometimes, and these are big topics.  But I've demonstrated clearly that I'm happy to elaborate and clarify my writings to anyone taking the trouble to reply.  If you don't like generalizations, you don't have to write them in reply.  All you have to do is to find holes or seek details in my arguments to expose their problems.  You don't write any reply, but you publicly criticize my writing as conspiratorial.  Are we in a scientific or religious debate after all?

Whether or not "money and finance are also a free market" doesn't seem to have any bearing in this thread. This discussion is about whether or not steel tariffs as proposed by Trump are going to do more good or more bad, and the details of that are specifically addressed in the posts above. Whether money and finance are free or not, we know with reasonably certainty exactly how steel tariffs will play out under the system as it is.

Tangential departures happen all the time in these discussions.  I'm not afraid to raise any issues loosely related to the OP, and I'm not afraid to defend any position in detail.

[BobK71]

More fuel to the fire!

There Is No Free Trade, Only the Drawinian Game of Trade

[jaysabi]

Your theory is that if enough ignorant people believe something strongly enough, it's probably important to learn from them? That's paraphrasing, but I think an accurate restatement of what you said. The masses used to believe in all manner of nonsense ranging from spirits to possession to human sacrifice, and that doesn't make any of those beliefs worth anything. I don't view economic ignorance any differently. The great things about facts is that they're true whether or not you believe them. Tyranny of the majority doesn't make something objectively true, it just makes the use of force to impose it more socially acceptable, which is an entirely different discussion.

Believe me, I have no theory that says believe in falsehoods.  But if a lot of people believe strongly in something that I don't, I'd like to look around a little and see if something is wrong with the entire framework from which I approach some issues, even if it means I won't agree fully with those people in the end.  This is fully relevant to the current topic.

I've been following the other thread already. I haven't posted anything in response because it's far too conspiratorial to get involved with. There's a lot of high level generalizations that are too vague to even really respond to without responding with equally high level generalizations that are basically just the opposite, and there's hardly a point to that. So I'll continue reading it to see if I have anything to add to the discussion, but thus far I don't.

So, let me get this straight.  You think my writings are too vague or general.  Fair point.  I try not to write too long sometimes, and these are big topics.  But I've demonstrated clearly that I'm happy to elaborate and clarify my writings to anyone taking the trouble to reply.  If you don't like generalizations, you don't have to write them in reply.  All you have to do is to find holes or seek details in my arguments to expose their problems.  You don't write any reply, but you publicly criticize my writing as conspiratorial.  Are we in a scientific or religious debate after all?

Whether or not "money and finance are also a free market" doesn't seem to have any bearing in this thread. This discussion is about whether or not steel tariffs as proposed by Trump are going to do more good or more bad, and the details of that are specifically addressed in the posts above. Whether money and finance are free or not, we know with reasonably certainty exactly how steel tariffs will play out under the system as it is.

Tangential departures happen all the time in these discussions.  I'm not afraid to raise any issues loosely related to the OP, and I'm not afraid to defend any position in detail.

Point 1 is a fair approach, but the evidence on this topic is so straightforward and conclusive to me that there's no point in considering an opposite viewpoint on this at this point just because a lot of people happen to believe protectionist policies happen in a vacuum and will work the way ultra nationalists promise they will. In fact, we've already seen things follow the exact expected path, with Trump carving out all kinds of exceptions because other nations threatened proportional responses to the steel tariffs. On point 2, I wasn't intending to criticize, just trying to give a justification on why I haven't gotten involved with the other thread. There's nothing in there for me at this time. Point 3, since your thread is already dealing with those issues, I don't see the point in bleeding them in here and essentially duplicating the same discussion and moving this one of its original track.