What Did Trump Contribute to 2018 G-7 Summit?
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Did the USA really get such a bad deal under NAFTA that it had to impose tariffs against Canada and Mexico?
President Donald Trump argues that the USA is getting a raw deal under NAFTA because its balance of trade is in a deficit position with the other two countries. (I can’t speak for Mexico, but Canada is actually in a deficit with the USA, not the other way around). Nonetheless, the claim bears commenting upon. First, the argument is specious because a trade imbalance merely means that the residents in the “deficit” country are spending more — resulting in foreign imports — and saving less. This is exactly the situation the U.S. finds itself in today, at least according to Trump. Second, Trump sells America on tariffs by claiming they will create more jobs. This is misleading. Sure, they’re expected to create 70,000 new jobs in steel production. But they’re also expected to destroy 190,000 jobs in metal fabrication. Third, there is no such thing as “free” (i.e., uninhibited) trade. What we have is liberalized (i.e., opened up...
Of Tulip Bulbs and Tin Cans
Of Tulip Bulbs and Tin Cans Profits based on speculation but not backed by intrinsic value will generally come to a halt. As Herb Stein said, if a thing can’t go on forever, it will eventually stop. In the early 17 th century, the Netherlands became the world’s most active trading nation. Futures contracts for tulip bulbs became so popular that at one point they were changing hands several times a day and fetching as much as (in today's dollars) $1 million. However, in 1637, the bottom fell out of the market when the bubonic plague broke out and nobody showed up at auction to buy them. Today, economists use the term “animal spirits” for profits based on speculation that are not backed by intrinsic value. President Donald Trump has used his considerable sales ability to stoke the American business community – and introduced (rashly in my opinion) deregulation – with the result that the U.S. economy is booming. The question is: is this a ...
If Canada is at a net trade loss with the U.S. why does it want to continue NAFTA?
If Canada is at a net trade loss with the USA why does it want to continue NAFTA? If Canada is at a net trade loss with the USA why does it want to continue NAFTA? Whether or not trade flows are in equilibrium is not a measure of fairness or prosperity. Because Canada is a wealthier country than most of America's trading partners, it can afford to buy more of America's goods and services and therefore import more than it exports. This is wonderful for both countries. We get what we need, and the Americans get richer. We're not concerned about an $8 billion deficit because our bilateral trade with the U.S. is responsible for 1.6 million Canadian jobs. (By the way, it also results in 3 million American jobs, so they benefit even more). It's a classical win-win. But to Trump, a "win" on NAFTA is to cause the two other parties -- Canada and Mexico -- to lose. Canada’s minister of foreign affairs, Chrystia Free...
Christians Under Trump Show Hypocrisy toward Refugees
Christians Under Trump Show Hypocrisy toward Refugees Islam, Judaism and Christianity all revere a scripture enjoining us to love immigrants as ourselves. ("The stranger that dwelleth with you shall be unto you as one born among you, and thou shalt love him as thyself.” (Leviticus 19:33-34)) Muslims and Jews seem to be taking the scripture seriously. Three-quarters of America's Muslims say they voted Democratic in the 2016 election, and ditto for 71% of America's Jews. As depicted in the bar graph below 85% of left-wing Democrats approve of accepting refugees (bottom blue bar), and 65% of moderate Democrats also approve (bottom red bar). But Christians are nothing if not hypocritical on this issue. Sixty-five percent of (white) Catholics, Protestants and Mormons say they voted Republican in 2016, as did 80% of (white) born-again evangelical Christians. And yet, accepting refugees into America was only favored by 40% of moderate Republicans (to...
IS A TRILLION DOLLAR DEFICIT SERIOUS? In the movie Austin Powers: International Man of Mystery , Dr. Evil holds the world hostage for one million dollars, and then quickly changes it to one billion dollars, then again to one hundred billion dollars. Another hundred-fold increase would have brought him to a trillion dollars, the amount of overspending the American government plans to do. (Recently, the Congressional Budget Office announced that the federal government's annual deficit was expected to exceed $1 trillion by the year 2020. ) How much is a trillion? Think of 1,000 square feet as being the size of an average high-rise condominium apartment. A hundred thousand square feet would be the size of a city block in Manhattan. A million square feet is the size of Amazon's new fulfillment centre in Baltimore. A billion square feet of floor space would hold all the people in the whole world . A trillion square feet is the size of Hung...