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Free Trade and the Steel Industry
YouTube ^ | 1978 | Milton Friedman

Posted on 10/09/2011 1:37:52 PM PDT by Toddsterpatriot

Milton Friedman shows the stupidity of tariffs.


TOPICS: Business/Economy
KEYWORDS: economy; global; tariffs; world
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1 posted on 10/09/2011 1:37:54 PM PDT by Toddsterpatriot
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To: Toddsterpatriot

BUY AMERICAN

Commence the Trade War

2 posted on 10/09/2011 1:38:57 PM PDT by Cringing Negativism Network (Santorum: Plan B to a certain Grizzly.)
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To: 1rudeboy; Mase; expat_panama; Rusty0604; Jim 0216; xjcsa; VegasCowboy; 10Ring; Bishop_Malachi; ...
Come on dennis, give it your best shot.
3 posted on 10/09/2011 1:39:08 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Cringing Negativism Network

Buy American, without government interference.


4 posted on 10/09/2011 1:40:02 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Toddsterpatriot

well we know what free trade has done for the American steel industry.


5 posted on 10/09/2011 1:40:07 PM PDT by driftdiver (I could eat it raw, but why do that when I have a fire.)
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To: Toddsterpatriot
Milton would have made your call for high tariffs look idiotic too.

This video is from 1979 when we dominated world trade. Zero Japanese automobiles being imported. We rarely ran trade deficits and they were tiny if we did. It was easy to be for free trade back then but times change
6 posted on 10/09/2011 1:42:49 PM PDT by dennisw (nzt - works better if you're already smart)
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To: driftdiver
well we know what free trade has done for the American steel industry.

What has it done for American steel users?

7 posted on 10/09/2011 1:43:44 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: dennisw

My first new car purchase was a 1977 Toyota Corolla.


8 posted on 10/09/2011 1:44:52 PM PDT by Arm_Bears (Once they've called you a racist, you've got nothing to lose.)
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To: dennisw
This video is from 1979 when we dominated world trade. Zero Japanese automobiles being imported.

Zero? Really? Link?

9 posted on 10/09/2011 1:45:17 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Cringing Negativism Network

Why buy American? I want to buy Tennessean. Nothing from outside my state.

None of that neo-liberal Milton Friedman clap trap.

We are the 99%!! (we are the 99%).


10 posted on 10/09/2011 1:45:43 PM PDT by barstoolblues (Neither teabagger nor tyrant)
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To: Toddsterpatriot

“What has it done for American steel users?”

It allows them to import bridges from China. Made exporting all those dollars a lot easier too. Not to mention the jobs, the technology, and the steel mills.


11 posted on 10/09/2011 1:46:59 PM PDT by driftdiver (I could eat it raw, but why do that when I have a fire.)
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To: Arm_Bears

Don’t confuse dennis with the facts.
He thinks the trade deficit causes the budget deficit.


12 posted on 10/09/2011 1:48:44 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: driftdiver

Importing cheaper goods? That’s awful!
The government must step in, right now.
Tell Obama how he can make it better.


13 posted on 10/09/2011 1:50:21 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: barstoolblues

Buy American is the only good idea the flea-baggers have.

Unfortunately, it’s among the most powerful ideas going.

Our side ignores it (and they are ignoring it) at our peril.

Just remember how quick Trump rocketed to lead the GOP field on the issue.

2 days it took. 2 days.


14 posted on 10/09/2011 1:53:01 PM PDT by Cringing Negativism Network (Santorum: Plan B to a certain Grizzly.)
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To: Toddsterpatriot

exporting jobs, thats great!
trade imbalance, wonderful
loss of technology, super!


15 posted on 10/09/2011 1:53:44 PM PDT by driftdiver (I could eat it raw, but why do that when I have a fire.)
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To: Toddsterpatriot
If everything was perfect, and infinite, Milton would be right.

But the world has limits that Friedman ignores. He seems to assume reasonably good intentions on the part of both parties.

Suppose the other party undercuts our prices, ends up owning the entire industry, and finances our spending not by buying the stuff we make but by loaning us back what we spent. Then, when we are used to buying stuff without making anything to sell in return, they pull the rug out. We would be hosed.

Left alone, we'd eventually get back on our feet. But if the other party has nefarious purposes behind this, we certainly would not be allowed to do so easily.

Would China be hurt if this happened? Certainly, but it might be ok with their leaders as long as they ended up on top.

At the end, Milton asks why we should refuse foreign aid. Foreign aid doesn't have that good a history. It's worked a couple of times, such as Europe and Japan, but has a lousy record in other places and times. Checkout the book title (something like) "Confessions of an Economic Hitman". You want to be real careful about the terms of foreign 'aid'.

Milton is right about tariffs in a non-hostile world. But that's not always reality.

16 posted on 10/09/2011 1:54:26 PM PDT by slowhandluke (It's hard to be cynical enough in this age.)
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To: Cringing Negativism Network

It’s a terrible idea to mandate that you can only buy American.

Mussolini tried that and it crippled Italy. That’s why I’m positive that Obama will do the same thing.


17 posted on 10/09/2011 1:56:32 PM PDT by BenKenobi (Honkeys for Herman! 10 percent is enough for God; 9 percent is enough for government)
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To: slowhandluke

“Milton is right about tariffs in a non-hostile world. But that’s not always reality.”

You’re assuming that economic ties are independent from foriegn relations.

If two nations trade together and are dependent upon on another, then what sense does it make to go to war?


18 posted on 10/09/2011 2:00:18 PM PDT by BenKenobi (Honkeys for Herman! 10 percent is enough for God; 9 percent is enough for government)
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To: BenKenobi

Who said anything about mandates.

I favor across-the-board import tariffs.

It’s how American originally raised government revenues to pay for things like our Navy. And building the interstate highway system.

And winning World War II.

Before we stopped making things here...


19 posted on 10/09/2011 2:01:20 PM PDT by Cringing Negativism Network (Santorum: Plan B to a certain Grizzly.)
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To: Toddsterpatriot

Zero or virtually zero Japanese automobiles being imported in 1979.... go look it up


20 posted on 10/09/2011 2:01:42 PM PDT by dennisw (nzt - works better if you're already smart)
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To: driftdiver
"...exporting all those dollars a lot easier too. Not to mention the jobs, the technology..."

--proving America has no problem with exports, it's the imports we need more of. 

If only we were allowed to import as many jobs, dollars, and techs as we exported then we'd be so much better off.  We need to dismantle our tariff barriers to allow these imports again even if we have to put up with crying protectionists complaining about all the job and dollar dumping that may bankrupt all our domestic producers.   Let's face it, these days Americans consume much more dollars, technology and jobs than can be produced locally.

21 posted on 10/09/2011 2:04:16 PM PDT by expat_panama
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To: dennisw

You made the claim, you go look it up.
Be sure to ping me when you discover your error.


22 posted on 10/09/2011 2:05:33 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Cringing Negativism Network

Yeah, sure.

But that’s not the situation now. All you’ll do is have tariffs plus everything else, which will destroy America on the international market.

Want to know why nobody wants to locate their business in America? 30 percent corporate tax. Nobody else is that high.


23 posted on 10/09/2011 2:07:10 PM PDT by BenKenobi (Honkeys for Herman! 10 percent is enough for God; 9 percent is enough for government)
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To: expat_panama

America needs to kill the public sector unions, bring corporate taxes down, cut all the red tape crap that prevents businesses from starting up in America, etc.

Tariffs simply tell the world one thing. America can no longer compete in the global marketplace. Instead they can only play on home turf.

What it will mean is that the average customer will see greater inflation, greater waste, and the standard of living for Americans will go down.

Then what do you do? Dropping the tariffs means that you’re exposing inefficient businesses to market forces again. Raise them even higher?


24 posted on 10/09/2011 2:10:27 PM PDT by BenKenobi (Honkeys for Herman! 10 percent is enough for God; 9 percent is enough for government)
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To: BenKenobi
Want to know why nobody wants to locate their business in America?

Well actually, because we do not require importers to do so.

Try selling into the Chinese market, without moving your factory and all your technology there. You won't be allowed in.

25 posted on 10/09/2011 2:16:47 PM PDT by Cringing Negativism Network (Santorum: Plan B to a certain Grizzly.)
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To: Toddsterpatriot

Toddster is back. Man were you wrong about gold...

End the Fed


26 posted on 10/09/2011 2:19:51 PM PDT by FightThePower! (Fight the powers that be!)
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To: dennisw

Here you are. Does this help your argument?

http://www.bts.gov/publications/national_transportation_statistics/html/table_01_16.html


27 posted on 10/09/2011 2:21:16 PM PDT by fudimo
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To: FightThePower!

Can you be more specific what I was wrong about?


28 posted on 10/09/2011 2:25:02 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: fudimo

Thanks. Nearly 2 million.
But for Dennis, that’s not his largest error to date.


29 posted on 10/09/2011 2:26:25 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: driftdiver
well we know what free trade has done for the American steel industry.

If only we had actual free trade... Steel imports have tariffs applied. We have highly managed trade subject to tariffs, quotas, set-asides, and protectionist policies.

How's it working out so far?

30 posted on 10/09/2011 2:30:01 PM PDT by FromTheSidelines ("everything that deceives, also enchants" - Plato)
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To: Cringing Negativism Network
Commence the Trade War

Yes, because the best way to bring jobs home is to tax US consumers!

31 posted on 10/09/2011 2:30:43 PM PDT by FromTheSidelines ("everything that deceives, also enchants" - Plato)
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To: FromTheSidelines

the entire concept of free trade is only for the naive. Every country wants whats best for it and its economy. So here we are giving our stuff away.

Its working so well that we don’t have a steel industry. The economy of China will surpass ours within a few years. The wealth is being created elsewhere and is not coming here.


32 posted on 10/09/2011 2:33:55 PM PDT by driftdiver (I could eat it raw, but why do that when I have a fire.)
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To: Cringing Negativism Network
I favor across-the-board import tariffs. It’s how American originally raised government revenues to pay for things like our Navy. And building the interstate highway system. And winning World War II.

You need to learn your history. We had income tax and corporate taxes well before WWII, which preceded the interstate highway system (which was built with gas taxes).

When America was the economic powerhouse in the 50s, it wasn't because we were financed by tariffs (we had Social Security, income taxes, and capital gains taxes well-established by that time). It was because we were the only real economic region that was not destroyed by WWII. Europe was leveled - as was most of Asia. We had our capacity intact - and that fueled most of our economic rise.

As soon as those other nations got back on their manufacturing feet, they started competing and doing well - Japan and Germany with cars, for example.

33 posted on 10/09/2011 2:34:54 PM PDT by FromTheSidelines ("everything that deceives, also enchants" - Plato)
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To: driftdiver
So here we are giving our stuff away.

Giving? How's that?

Its working so well that we don’t have a steel industry.

We don't produce any steel here? Are you sure?

34 posted on 10/09/2011 2:37:38 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Cringing Negativism Network
Try selling into the Chinese market, without moving your factory and all your technology there. You won't be allowed in.

Really? Source, please... Because you're wrong. Most Mercedes and Audi cars, most of the original Buicks and Fords and Volkswagens, were imported to China - and there was a tariff applied (just like we apply tariffs to imported cars).

Now those companies sell enough cars there it's worthwhile to BUILD them there, and avoid the tariffs and the issues with corporate income tax. For much the same reason BMW, Mercedes, Honda and Toyota build cars here - avoid the tariffs.

35 posted on 10/09/2011 2:37:56 PM PDT by FromTheSidelines ("everything that deceives, also enchants" - Plato)
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To: Toddsterpatriot

Yes we produce so much steel that California is buying bridges from China.

But perhaps I’m wrong and you’ll tell me our steel production is higher now than ever before.


36 posted on 10/09/2011 2:41:08 PM PDT by driftdiver (I could eat it raw, but why do that when I have a fire.)
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To: FromTheSidelines

You’re right they want our factories there, so they can steal the intellectual property.


37 posted on 10/09/2011 2:42:46 PM PDT by driftdiver (I could eat it raw, but why do that when I have a fire.)
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To: Toddsterpatriot
Maybe Dennis thinks it is a rounding error.

On another note look how the number of Japanese imports start to fall around 1994&1995. Could it be because the Japanese are building cars here in the US and supplying Americans with good paying NON UNION jobs.
One more thing The US steel industry is not dead but transformed into smaller specialty or botique areas. The foreigners do the bulk dirty dangerous work.

38 posted on 10/09/2011 2:44:22 PM PDT by fudimo
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To: Toddsterpatriot
I think that a prerequisite for participating in this thread should be to read Alexander Hamilton's Report on Manufactures . . . having said that, I'll withdraw, because I'm very pro-American and anti-other-countries when it comes to manufactured goods (to the point where I would rather see factories back in places like Manhattan and Jersey City rather than the "gentrification" that's there today) . . .
39 posted on 10/09/2011 2:45:12 PM PDT by Olog-hai
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To: driftdiver
the entire concept of free trade is only for the naive. Every country wants whats best for it and its economy. So here we are giving our stuff away.

What are we giving away? Seriously - I'm curious what we're giving away.

Its working so well that we don’t have a steel industry.

Is that because of the importing of Chinese and Korean steel (there's a lot of 20%, 30%, 45%, 50% tariffs applied) doesn't have enough tariff applied? Or is it because the costs of refining steel here has gotten so out of hand that you simply cannot make a profit doing it here?

Remember, on top of the EPA riding roughshod over your business, and the unions forcing crushing wages and benefits, you'll also get to pay 35% income tax on your corporate earnings - and another 15% or more capital gains tax when those profits are paid out.

Maybe the reason most of the steel industry has left the US is not because of cheap costs for imported product (when you add a 45% tariff that's a pretty stiff hit), but because our own Government and system has made it too expensive to actually build here.

40 posted on 10/09/2011 2:45:43 PM PDT by FromTheSidelines ("everything that deceives, also enchants" - Plato)
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To: FromTheSidelines

ahh so the answer to the EPA is to send all the work, investment, and revenue offshore.

and then argue that it will make America stronger.

yeah thats da ticket


41 posted on 10/09/2011 2:47:23 PM PDT by driftdiver (I could eat it raw, but why do that when I have a fire.)
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To: driftdiver

You don’t have to move your factory to China or South Korea or Malaysia or Japan in order to sell in those markets. Companies choose to do it because it makes economic sense.

How about we give companies a reason to move back home, and to encourage other foreign companies to invest here? Eliminate the corporate tax rate. Roll back all business and environmental regulations to 1995. You’ll have a mad crash rush of money, people, and businesses to the US.

Or we can take the protectionist approach and raise taxes on US consumers in an effort to punish foreign nations...


42 posted on 10/09/2011 2:48:47 PM PDT by FromTheSidelines ("everything that deceives, also enchants" - Plato)
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To: driftdiver

Let me see if I can make this easy for you...

You make cars. They’re in high demand overseas. You’re selling well in a market that is growing overseas.

You can go ahead and make the cars here, and bear a $7000 union “tax” for each car, and another $3000 EPA “tax” for each car you make here. And then have a 20% tariff on the import of your car overseas. And pay 35% profits on any money you make on that car.

Or you can move overseas, eliminate the union tax, the EPA tax, the tariff, and cut your corporate income tax down to 17% or lower.

So which would you do? You want to keep your taxes nice and high, and your profits at the whim of the unions and the Federal Government? Is that the way forward?

Do you buy anything made overseas? How about your cell phone, laptop or TV? What car brand do you drive?


43 posted on 10/09/2011 2:52:22 PM PDT by FromTheSidelines ("everything that deceives, also enchants" - Plato)
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To: Toddsterpatriot
Every time I drive out of town I pass huge fields of soybeans. In 2009 (latest year for which I could get data) the US exported 1.56 billion bushels of soybeans, worth $15 billion (with a "b"). Exports amounted to 55% of total soybean crop. The rest was used domestically, mostly as animal feed.

China took 686 million bushels, or 23% of our total soybean production. Mexico was our second biggest buyer, taking 113 million bushels. Japan took 88 million bushels.

What's the point, here? Ultimately our exports must be paid for in dollars. The only way foreign purchasers of our exports can acquire dollars is to sell to us. If you limit imports with tariffs or other trade barriers, you're killing jobs in the export industries in which we're competitive worldwide.

You might want to argue that soybeans are not a very impressive export. Let's look at the aircraft industry. Boeing finally got their 787 Dreamliner out of trouble. The first airplane delivered went to All Nippon Airways. ANA paid for that airplane with dollars earned by Japanese firms exporting to the US. Stop those imports, and you kill jobs in the aircraft industry.

Finally, in defense of agriculture, in 2010 total US exports of agricultural products were $115.8 billion. There are three classical indicators of "high tech" industry: R&D as percent of sales; capital investment per worker; and value added per worker. US agriculture has high values on all three indicators. Next time you want to see a high tech industry, go look at your nearest soybean field, cotton field, or wheat field. Don't go destroying our high tech, world-wide competitive industries by "protecting" industries that can't compete in the world market.

44 posted on 10/09/2011 2:53:26 PM PDT by JoeFromSidney (New book: RESISTANCE TO TYRANNY. A primer on armed revolt. Available form Amazon.)
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To: dennisw
It was easy to be for free trade back then but times change

Yes. Because limiting freedom solves so many problems.

45 posted on 10/09/2011 2:55:16 PM PDT by BfloGuy (Even the opponents of Socialism are dominated by socialist ideas.)
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To: Toddsterpatriot; fudimo

We were hardly running trade deficits back then meaning pre-Ronald Reagan. Go check out the stats. Thus we could afford the stupidity of allowing Japan to make inroads in our automobile market. We did this because Japan was a loyal ally. The ChiComs are adversaries yet we allow their imports to invade America. That is plain traitorous and dumb

Looks like we were importing 2 million Jap cars back then pre-Ronald Reagan. My mistake


46 posted on 10/09/2011 2:57:26 PM PDT by dennisw (nzt - works better if you're already smart)
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To: driftdiver

Higher than ever? I thought you said we don’t have an industry anymore?


47 posted on 10/09/2011 3:01:15 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Toddsterpatriot
Can't have too much freedom now, people might begin acting in their own self interest....you know, that greed thing Dennis supports.

I could have sworn I heard Friedman say that greed was good in another take-down of some big government liberal. I wonder who posted that clip...?

48 posted on 10/09/2011 3:01:48 PM PDT by Mase (Save me from the people who would save me from myself!)
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To: BfloGuy; Toddsterpatriot

On your tombstone it will read -—

“He was a free trader until the end even though it impoverished his sons and daughters and ruined his community and shut down half the factories. He was a man of principles. Idiotic principles and the Chinese proved this”


49 posted on 10/09/2011 3:02:20 PM PDT by dennisw (nzt - works better if you're already smart)
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To: FromTheSidelines

I’ll make it even easier for you. Is America stronger today, compared to other countries, or is it weaker?

Pretty simple isn’t it.


50 posted on 10/09/2011 3:03:37 PM PDT by driftdiver (I could eat it raw, but why do that when I have a fire.)
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