Posted on 08/05/2016 7:02:35 AM PDT by 1rudeboy
Ronald Reagan was an advocate of free trade throughout his presidency. But just like today, many Americans in the 1980s opposed free trade and pushed for measures that would keep the nation out of the global economy.
Fortunately, Reagan argued persuasively in support of trade, and his success led to rapid growth in the U.S. economy.
He knew that protectionist policies might benefit some industries, but they hurt others.
When the government gets involved in trade, special interests get a chance to game the system. These groups excel at making it hard to tell how their policies harm Americans.
In his 1987 economic report, Reagan explained how protectionism hurts consumers:
Whatever the motive, protection in any form redistributes income and wealth. And because the redistributive effects are usually not readily apparent, special interest groups sometimes favor and governments often choose these methods over other more visible and much less costly forms of subsidy. Protection raises the price of imports and domestically produced import-competing products.
Reagan realized that history provides many examples of the damage unfree trade policies can do.
Speaking to the nation in the summer of 1983, he reminded Americans that the United States has gone down the road of protectionism before—with disastrous results. He said:
One economic lesson of the 1930s is protectionism increases international tensions. We bought less from our trading partners, but then they bought less from us. Economic growth dried up. World trade contracted by over 60 percent, and we had the Great Depression. Young Americans soon followed the American flag into World War II.
Free trade has the opposite effect, which Reagan knew well. Speaking at a reception in Tokyo on Nov. 10, 1983, he succinctly summarized his philosophy on trade, stating:
The message I want to leave with everyone here tonight is simple. It’s a lesson history has taught us again and again. Protectionism hurts everyone, but free trade benefits all.
Ronald Reagan was right about trade, and the exceptional economic growth during his presidency provides proof.
Research conducted by The Heritage Foundation shows a clear correlation between low trade barriers and economic prosperity. Today, we must remember that free trade leads to more prosperity for all, while protectionism hurts American consumers and producers.
| Statistic | Actual | Briefing Forecast | Market Expects | Prior | Revised From |
| Nonfarm Payrolls | 255K | 180K | 185K | 292K | 287K |
| Nonfarm Private Payrolls | 217K | 174K | 171K | 259K | 265K |
| Average Workweek | 34.5 | 34.4 | 34.4 | 34.4 | -- |
| Trade Balance | -$44.5B | -$43.0B | -$42.7B | -$41.0B |
Great news --trade deficit gets bigger as more people are working!
Excellent! You're not completely ignorant of economics.
Of course this refutes your claim that if you don't buy the foreign product you don't pay the tax.
Now if the CEO of GM talked to the CEO of Ford and said, let's hike prices by $9000 per car, that would be collusion.
What would you call it if they both raised prices by $9000 per car after the government raises taxes on imports by $10,000, with no communication?
It's what happens after that is what's important.
Exactly. That's where your protectionist ideas always fail.
So lets say Company A is currently running 2 shifts and has a 33% excess capacity before the embargo. What happens after the embargo?
And that’s the thing—trade deficits (generally) are inversely correlated with the health of the economy. The surest way to lower the trade deficit is to drive the economy into recession.
We hear all the time about sending factories overseas but this idea just doesn't make sense:
Somehow it should be a lot more reasonable to see that the purpose of a factory is to make things and not to just give money to the unemployed. I've built factories and I've owned them only as long as they made things I could sell. As soon as any of them stopped doing that I've sold them and built new factories.
Factories are big, they don't move, and they can't be 'sent'.
It is amusing when my simplistic analysis refutes your silly claims.
So lets say Company A is currently running 2 shifts and has a 33% excess capacity before the embargo.
You think the secret to recent automaker profitability is to have 33% excess capacity?
That's kinda why they went under during the crisis.
Free Trade, big difference from what has been shoved down our throats.
I hear that a lot. But no one can ever tell me what has been shoved down their throat.
If here is collusion then venture capitalist will start a new company D and they will undercut all three to reap the huge profit margin again the pressure on price will be downward.
That explains their wish for tariffs to bail out their poor decisions.
It's interesting how easily I refuted your claim, "Tariffs are voluntary taxes, don't buy don't pay"
Its normal for a plant to not operate 24/7 and only have two shifts.
I view this as good new.
In 1983 Reagan said it all.
“WASHINGTON, April 1— In an unusually strong protectionist action, President Reagan today ordered a tenfold increase in tariffs for imported heavyweight motorycles.”
Huh? I read your link to mean that Toyota was going from 2 to 3 shifts, so it could operate 24/7.
How did you feel when Obama announced his tariff on tires, or when Bush 43 announced his tariffs on steel?
Re:
I’m not mad, and you are not crazy. Our manufacturers pay the highest (or the second-highest, depending on the measure) corporate income tax rate in the world, and they do so on their worldwide income, which is a concept unheard of elsewhere. It probably is the largest factor contributing to off-shoring, but no one cares to discuss it . . . because raising taxes on importers (i.e., raising taxing on ourselves—but who thinks that far?) is easier to do politically than reforming the corporate tax code (which would make people think, instead of emote).
This is only partially true. Our SMALL, DOMESTIC manufactures pay the highest corporate taxes. Unfortunately this is where most new jobs are created.
These same manufacters are also hamstrumg by excessive environmental regulation.
However our manufacturers that are run by LARGE, GLOBAL CORPORATE are quite skilled at evading taxes.
http://topics.bloomberg.com/the-great-corporate-tax-dodge/
China, while we may not have a free trade treaty with it, joined the WTO under special protocals, read exemptions
“The fine print in China’s WTO agreement was in an attached document euphemistically labeled an “accession agreement,” which gave China status as a “nonmarket economy” and spelled out thousands of details about special preferences for China. China was allowed to impose higher tariffs than other countries, and ever since has protected its auto industry by a prohibitive tariff on imported cars. By contrast, South Korea’s tariff on imported cars is 8 percent, and the European Union’s is 10 percent. “
http://www.eagleforum.org/psr/2012/jan12/psrjan12.html#3
see post 57
Yeah, I hear that a lot from the OWS-types. US corporations are not paying their “fair share.” And then conservatives hop aboard the Willie Green train and argue that we shouldn’t reform the corporate tax code for that reason, as if the one has anything to do with the other.
We have not VAT so the argument is not complete.
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