Plan B Fails

[CuckingFunt]

Expect a page or two arguing about whether tax breaks are subsidies.

I seem to recall you calling a tax break a subsidy.

Giggle.

[Wild Cobra]

Giggle.

Why?

We had this discussion before. Chump simply remembers. It wasn't a prediction to have any special merit. For it to go otherwise would mean ElNono or myself changed our position.

[ElNono]

It depends on the price density. Quan ies of cell phones for example will always be cheaper to import. You can't bring US taxes down enough for something that small and costly. Still, the cons ution provided an insightful tool that is being eliminated more and more as the years go by. It's called a "tariff."

A tariff, however, is inherently a distortion in a free market.

What you're telling me is that the free market failed and you want protection from the free market in the form of tariffs...

In other words, the free market shouldn't be free when it's not working for us.

BTW, subsidies work pretty much the same way. Strange you would be for tariffs and against subsidies.

[ElNono]

No need.

A tax break is not a subsidy. A tax credit is.

How is giving up revenue not giving up money?

It works the same in government as in everything else. If you're giving a discount it's coming out of your pocket.

[Wild Cobra]

A tariff, however, is inherently a distortion in a free market.

So?

What you're telling me is that the free market failed and you want protection from the free market in the form of tariffs...

Only from a global scale.

In other words, the free market shouldn't be free when it's not working for us.

We shouldn't have such "free trade" agreements. Tariffs are there, in the cons ution, for a reason.

BTW, subsidies work pretty much the same way. Strange you would be for tariffs and against subsidies.

Really?

Please explain to us children how they work the same.

[CuckingFunt]

Why?

We had this discussion before. Chump simply remembers. It wasn't a prediction to have any special merit. For it to go otherwise would mean ElNono or myself changed our position.

Considering the posts that have followed, I stand by my giggle.

[ElNono]

So?
Only from a global scale.

So you don't think the free market works in a global scale, or you stopped liking it when you got the bad side of the coin?

We shouldn't have such "free trade" agreements. Tariffs are there, in the cons ution, for a reason.

Trade agreements are on the Cons ution too... Article I, section 10, clause 3 and Article II, section 2, clause 2.

Really?

Please explain to us children how they work the same.

Sure. Both methods seek the same end result: artificially creating a compe ive balance. Tariffs do it by artificially increasing the price of imported goods so the local producer can compete with imports.

Subsidies do the exact same by artificially reducing the price of local goods so they're compe ive with imported goods.

[Wild Cobra]

So you don't think the free market works in a global scale, or you stopped liking it when you got the bad side of the coin?

I have been very consistent on my views of free trade. Don't you remember?

Trade agreements are on the Cons ution too... Article I, section 10, clause 3 and Article II, section 2, clause 2.

I'm speaking of Article 1 section 8:

The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;

Sure. Both methods seek the same end result: artificially creating a compe ive balance. Tariffs do it by artificially increasing the price of imported goods so the local producer can compete with imports.

Yes. Do you have a problem with that?

Subsidies do the exact same by artificially reducing the price of local goods so they're compe ive with imported goods.

One is a tax revenue create, the other is a payment made by the government.

You beloved subsidy becomes another burden on our budget system. The tariff is a revenue enhancer. they are complete opposites in that regard.

[ElNono]

I have been very consistent on my views of free trade. Don't you remember?

To be frank, no. I'm pretty sure not that long ago you were telling us how the free market 'self-corrects' and what not.
Apparently, there should have been a big ass asterisk on that comment (not globally).

I'm speaking of Article 1 section 8:

I know what youre talking about, all I'm saying is that agreements are just as cons utional.

Yes. Do you have a problem with that?

I have mostly two concerns with tariffs, which are the common ones: once you start penalizing certain countries and goods, there's no reason for other countries not to penalize US exports the same way. Basically, it's a protectionist measure that doesn't even really address the actual problem: you cannot compete at this time.

The second concern is basic economics: price inflation on goods = reduction of purchasing power. You basically get an inflation bump and, as noted before, you're not really solving the problem.

One is a tax revenue create, the other is a payment made by the government.

You beloved subsidy becomes another burden on our budget system. The tariff is a revenue enhancer. they are complete opposites in that regard.

Oh I know the difference is who foots the bill. Trade tariffs are rarely long term revenue generators though, because they never really address the main problem (lack of compe iveness), so at some point the producing country will simply scale back or find a better partner with higher margins.

[Wild Cobra]

My view on trade agreements between us and other countries is very consistent. I was only for NAFTA, and that is because we are immediate neighbors with Mexico. I saw it as a win-win for us, which i would have never agree with if they were not our immediate neighbors. I have always voices favoritism to NAFTA, and always voiced concern over the rest of our free trade policies when dealing with nations of such low living standards.

I understand your concern with tariffs. It's a false idea that countries will do a -for-tat, and even if so, what is the worse case situation? We stop buying $5 billion of their goods, and they stop buying $50 million of ours? I don't see a problem when there is a trade imbalance to begin with.

You are myopic about the purchasing power. You are not seeing the larger picture. We already are on the downward spiral of less purchasing power. Look at property, food, and energy prices. The increasing supply of cheap goods only covers up the reality of what has been happening all along. This is now, a vicious circle that we must stop. We need to bring back these higher wage manufacturing jobs that we have been losing. we need to increase our average worker pay by more employment, less unemployment rate. Supply and demand works with worker salaries too you know. Obama and his rich elitist buddies love this high unemployment rate. They don't have to pay compe ive wages!

I have a hard time believing you understand who foots the bill. Only a socialist or communist would be happy to subsidize the national marketplace, at the increasing burden of others. What else do you want to nationalize? Isn't healthcare enough?

[ElNono]

My view on trade agreements between us and other countries is very consistent. I was only for NAFTA, and that is because we are immediate neighbors with Mexico. I saw it as a win-win for us, which i would have never agree with if they were not our immediate neighbors. I have always voices favoritism to NAFTA, and always voiced concern over the rest of our free trade policies when dealing with nations of such low living standards.

So what free trade agreements are you talking about when it comes to China/India/Indonesia/etc/etc?

I think we have a 'most favored nation' agreement with China that dates back to many years, but other than that, I'm pretty sure it's regular commerce.

Now, personally, I'm not a huge fan of FTA myself, as they're yet another market distortion mechanism. While I'm not necessarily a free market purist, I think these agreements should work both ways, and they rarely do.

I understand your concern with tariffs. It's a false idea that countries will do a -for-tat, and even if so, what is the worse case situation? We stop buying $5 billion of their goods, and they stop buying $50 million of ours? I don't see a problem when there is a trade imbalance to begin with.

Well, it's easy to see the problem... It's not just that country that has to do it. If Brazil all of a sudden wants to start charging tariffs on US petrol products, what authority does the US has to tell them not to do it when the US does it too with other nations? That's why the US normally uses tariffs of very specific items.

You are myopic about the purchasing power. You are not seeing the larger picture. We already are on the downward spiral of less purchasing power. Look at property, food, and energy prices. The increasing supply of cheap goods only covers up the reality of what has been happening all along. This is now, a vicious circle that we must stop. We need to bring back these higher wage manufacturing jobs that we have been losing. we need to increase our average worker pay by more employment, less unemployment rate. Supply and demand works with worker salaries too you know. Obama and his rich elitist buddies love this high unemployment rate. They don't have to pay compe ive wages!

That's a pretty cool rant, but as far as economics go, pretty superficial. There's no why we must have back these high paying manufacturing jobs or why are we in this vicious cycle, or what the vicious cycle even is.

In fact, per the free market, all those things should just happen naturally: China keeps reaping record profits from trade with the US, the increased wealth creates a higher standard of living in China, and so such increase makes us compe ive again. When you look at why its not happening, you have to look at the peculiarities of China, specifically what they do with their currency.

I have a hard time believing you understand who foots the bill. Only a socialist or communist would be happy to subsidize the national marketplace, at the increasing burden of others. What else do you want to nationalize? Isn't healthcare enough?

Cool story, but wrong per par. I'm not a fan of subsidies, but I understand why sometimes they have to be done as a matter of national security (ie: food)

[sook]

Why do republicans hate america so much?

[Wild Cobra]

So what free trade agreements are you talking about when it comes to China/India/Indonesia/etc/etc?

I think we have a 'most favored nation' agreement with China that dates back to many years, but other than that, I'm pretty sure it's regular commerce.

I'm against all of them except NAFTA, regardless of name. Imports need to be taxed to a level that they do not unfairly compete against our own goods. If it's something we cannot do here, then I'm Ok with no tariff.

Now, personally, I'm not a huge fan of FTA myself, as they're yet another market distortion mechanism. While I'm not necessarily a free market purist, I think these agreements should work both ways, and they rarely do.

Well, as long as we are a wealthier nation than others, we will have a net trade imbalance. This is simply because we have a larger purchasing power than most other countries.

Well, it's easy to see the problem... It's not just that country that has to do it. If Brazil all of a sudden wants to start charging tariffs on US petrol products, what authority does the US has to tell them not to do it when the US does it too with other nations? That's why the US normally uses tariffs of very specific items.

Let them charge what ever tariff they want. that is between them and their people as to how much higher prices they want to pay and how much less they want to buy. Are you now suddenly worried about EXXON, BP, etc?

That's a pretty cool rant, but as far as economics go, pretty superficial. There's no why we must have back these high paying manufacturing jobs or why are we in this vicious cycle, or what the vicious cycle even is.

If that's what you wish to believe. Just what idea do you have to return people working? More fast food joints?

In fact, per the free market, all those things should just happen naturally: China keeps reaping record profits from trade with the US, the increased wealth creates a higher standard of living in China, and so such increase makes us compe ive again. When you look at why its not happening, you have to look at the peculiarities of China, specifically what they do with their currency.

Yes, as their average standard of living increases, and ours decreases, at some point, we will be equal trading partners.

Do you really want our standard of living to go down that far?

Cool story, but wrong per par. I'm not a fan of subsidies, but I understand why sometimes they have to be done as a matter of national security (ie: food)

I can understand farming subsidies. More than keeping prices low, it was to keep farmers farming, so we would always have crops. That doesn't mean I agree with the subsidies, I simple acknowledge the purpose. Now, for example, that corn is required for the mandated ethanol in gasoline, don't you think it's time to stop subsidizing it?

[scott]

Still, the cons ution provided an insightful tool that is being eliminated more and more as the years go by. It's called a "tariff."

It's a good thing that macroeconomics hasn't evolved over the last 225 years, otherwise this might be viewed as a terribly stupid, myopic statement completely detached from modern realities.

[scott]

Only a socialist or communist would be happy to subsidize the national marketplace, at the increasing burden of others.

LOLz

[velik_m]

It's a false idea that countries will do a -for-tat, and even if so, what is the worse case situation?

World war 3?