Fair Trade vs. Free Trade
One of the things you can say about Donald J. Trump is that he’s consistent, but he’s hardly ever right. For example, he thinks he knows a lot about money. The logic runs something like this: “I made a billion dollars, so I know how to fix things.”
It would be different if the stock market wasn’t at all-time highs. It would be different if the unemployment rate was in the toilet. But as the administration rolled out fire trucks and back hoes on the front lawn of the White House to promote their America First dogma, the headline in the Washington Post was “Trump’s ‘Made in America’ week is a hypocritical joke.” None of Donald and Ivanka Trump products are made in America. Ivanka’s shoes, handbags, blouses, dresses, jeans and shirts are made in Bangladesh, Indonesia, Vietnam and China and Donald’s ties and suits are made in China, Bangladesh and Mexico. When confronted with this fact, the two moguls say, “Everybody else does it.” Really?
Why does the press keep slapping this man? It seems like everything our President touches turns into a controversy at least and a bag of flaming crap at worst. Our very own Don “Quixote” Trump is not only fighting windmills, he is attempting to stop Niagara Falls with his bare hands. Our brave hero.
One of the lessons of war that escapes Donald Trump is what happened after the World Wars. The first war led to the losers to disastrous economic plights that turned people inward and voted for people like Hitler and Mussolini.
The nations of victors in WWII knew that they had to help the economies of many countries to make sure that peace would last. The United States basically took Japan on as a special project. We airlifted in experts and technologies to teach the Japanese how to make many products.
The hard-working Japanese culture and South Korean’s post conflict manufacturing produced some of the finest electronics for the world, and still does. The Donald must have been busy being rich in the 1950s and doesn’t remember how America was flooded with cheap products, like transistor radios, that were labeled Made in Japan.
As more and more American companies realized that they could get cheap parts for their products, the flood gates opened. Many of our automotive offerings needed more and more computer technologies, thus the need to import more parts from other countries. We also created giant discount box-stores that sold everything from TVs to T-Shirts at rock bottom prices. How did they do it? They bought products from other countries that were made by low wage workers.
While the United States knew that workers and factories here were being phased out, we kept thinking we could move those workforces to other industries. That only happened when the worker saw the writing on the wall early and had the capabilities to serve the needs of another field.
Training was essential to complete the migration from the agricultural age to the manufacturing age. Did we forget about this? Logic follows that it would take the re-education of millions of workers to pull off the conversion this time. Some people just don’t want to change.
Now, our great Orange Leader wants us to brand all our products with ‘Made in America.’ I get that, but it’s just a Band-Aid. In fact, the Band-Aid was invented in 1920 by Thomas Anderson and Johnson & Johnson employee Earle Dickson in Highland Park, New Jersey. Not all bandages are made in America, but they are a great example of an American invention that the world now uses. And the examples are countless. We design things, we just cannot make them at reasonable prices because Americans demand a wage to match our prosperous economy. Double-edged sword.
When NAFTA (North American Free-Trade Agreement) was signed, products moved from Canada and Mexico into the US without tariff. We also sold tons of stuff to those two countries.
According to the United States of America Trade Representative (an office of the President): The U.S. goods and services trade deficit with Mexico was $55.6 billion in 2016. Mexico is currently our 3rd largest goods trading partner with $525.1 billion in total (two way) goods trade during 2016. Goods exports totaled $231.0 billion; goods imports totaled $294.2 billion.
And their figures on Canada are similar: U.S. goods and services trade with Canada totaled an estimated $627.8 billion in 2016. Exports were $320.1 billion; imports were $307.6 billion. The U.S. goods and services trade surplus with Canada was $12.5 billion in 2016. Canada is currently our 2nd largest goods trading partner with $544.0 billion in total (two way) goods trade during 2016.
As you can see, this cry-baby tantrum about “fair trade” is foolish rhetoric by the President on the NAFTA deal. As far as China and other Pacific Rim countries are concerned it’s a different question, but best not to ask too loudly. With the amount of U.S. debt that Chinese banks hold, and our need for China to control North Korea, we might want to carefully plan what we say. Best not to Tweet.
Why does Trump keep complaining about trade? He skillfully convinced those workers who have been displaced by global trade to vote for him. He has to keep them in the hypnotic trance where he promises to magically take them back to a “better time.”
The mantra of “Jobs, Jobs, Jobs” only means something if the great one can actually create more jobs. Focusing on coal mining is convoluted logic. Coal has been displaced by natural gas and the good news, the US is pumps lots of that resource. The symbolism might be rich, but Trump is regressive in his thinking. Why did China just take the lead on producing solar energy products? Did we miss that?
Trump actually thinks that getting rid of regulations will magically grow plants and jobs. Rules don’t keep people from being successful, global markets do. Even if we got rid of every regulation, we would still have to produce steel at a price that competes. ‘Globals’ will always be able to make things cheaper and we could tax the imports but that would increase the price here. Why make the America consumer pay for your trade myopia?
What Donald Trump really doesn’t understand is that he’s a President for 1959, not a president for 2017. It’s too late to stop the windmills of the world from turning. If they don’t sell to America, they will sell to someone else. The water will keep coming over the falls, because that is what nature does.
Trump’s one man fight against globalization might make him look like Captain America, but in reality he’s just another America businessman taking advantage of Free Trade for his own benefit. Buy one of his ties, you’ll see where it was made.