In a widely expected move, Gary Cohn to Resign as Trump Economic Adviser After Trade Dispute.
“It has been an honor to serve my country and enact pro-growth economic policies to benefit the American people, in particular, the passage of historic tax reform,” Cohn said in a statement released by the White House to reporters. “I am grateful to the president for giving me this opportunity and wish him and the administration great success in the future.”
The president’s announcement on Thursday that he would press forward with a 25 percent tariff on steel imports and 10 percent on aluminum left markets reeling and served as a public rebuke of Cohn, the director of the National Economic Council, who had furiously lobbied against the penalties.
One person with knowledge of the chaotic West Wing decision-making process said Cohn and Commerce Secretary Wilbur Ross, who had recommended the tariffs to the president, privately argued over the issue just hours before it was announced.
Trade Wars Will Not Bring Back Jobs
Trump is promoting trade wars that mathematically cannot be won.
For a mathematical explanation of trade deficits, please see Trump’s Tariffs Show He’s “Clueless About Trade”.
Also see Kindergarten Arithmetic 101: Analysis of the Trade Debate.
Mike “Mish” Shedlock
I’ve had the misfortune of reading a few of your comments on this blog and here’s a word of advice: you have no clue about either economics or finance so I suggest you pay more attention to the people who have something of value to say rather than sullying this blog with your dim-witted opinions, FFS.
sticker
A country by country tariff would be a better plan than a tariff on a manufacturing input, but without a matching tariff on the finished product. Note that even then, tariffs invite smuggling. The government can’t control borders now. Back in 2002, during the last steel tariff, I saw steel products that were made in China that were shipped to Canada, then re-shipped to the US with a “product of Canada” stick on them.
Typo: I support tariffs only on low-wage countries.
Carl: I do not support the proposed Trump steel tariffs as currently targeted. I believe in competition- between products, but not competition between which labor force can work for the cheapest. Therefore, I oppose any tariffs on Canada or any oter nation where workers make a similar wage to the U.S. But I strongly support a targeted tariff proportional to the huge wage difference in China orMexU.S. workers should not have to compete with workers in low-wage countries to see who will work cheapest. That is a race to the bottom, and it has been very damaging to our society. So : little or no tariffs on Canada, and large tariffs on Mexico.
The steel/aluminum tariffs will be felt more in Canada and Europe but not in China. I was talking to my brother who lives in China and he said the Chines will simply adjust the RMD down to eliminate the cost of the tariffs. Canada and Europe can’t do that with their currencies. He said the Chinese have been wanting to let the RMB rise but if need be, they will notch it down and wait out the carnage it will cost to American business.
@TheLege, no, asshole, I mean if you keep repeating yourself for 30 years and your predictions never come to pass, don’t brag when your broken watch finally tells the right time for the first time in 12 hours.
phil, if you believe that protecting manufacturing jobs is important, you should oppose the steel tariff. There are only 35,000 people employed in making steel. The last steel tariff, in 2002-3, cost 50,000 manufacturing jobs in industries that use steel to make their products. Why? American manufacturers had to buy American steel, and had rising prices and poor availability, while their foreign competitors could use cheaper and readily available steel overseas. I gave one specific example that I was familiar with, Midwest Wire Hanger in Kansas City, who went from profitable to broke in a matter of months after the tariff went into effect as they found themselves underpriced by 30% by Chinese Hangers. As soon as they closed, the Chinese bought their equipment and shipped it back to China, assuring that they could never re-open.
If you are going to do tariffs, you must do them wisely. The worst possible thing to put a tariff on is something that is an ingredient in other manufactured products.
“Free trade” is a Trojan Horse for U.S. corporation to outsource (and destroy) U.S. manufacturing jobs to low-wage countries so as to re-import the manufactured products back to the U.S. market without a tariff penalty. The loss of family-wage manufacturing jobs here has changed the U.S. economy and society for the worse. Other countries protect their products and manufacturing jobs. We should too.
Both?
What you mean to say is: Ron’s explained the situation a hundred times but you still don’t get it? Perhaps if he wrote a book for children that would help?
Mish nothing will be jobs back. We need to accept the capitalistic system is on the way out. We are on the precipice of eliminate most human labor.
It found that 200,000 people lost their jobs in the US from the steel tariffs. 50,000 of these were people who were in manufacturing industries that used steel. More people lost their jobs from the tariffs than were employed in the entire steel industry. American manufacturers who used steel were disadvantages with higher prices and low availability. “The impact on steel consuming industries has been significant.”
Note this particularly important study: http://www.tradepartnership.com/pdf_files/2002jobstudy.pdf
Here’s an article about the 2002 Steel tariffs imposed by Bush: https://globalnews.ca/news/4063058/bush-steel-tariffs-trump-trade-war/
I like Ron Paul a little (his son, more), but he’s a broken record.
Was he required to stay on the job for at least a year to get the capital gains break? It’s a crazy loop hole. Goldman Sachs billionaires cash out tax-free for the cost of going to Washington and re-writing the tax laws for their own benefit.
https://twitter.com/zerohedge/status/971156610956570625
https://twitter.com/RinoTaglia/status/923257478321721344
In case anyone was wondering, my comment about Cohn’s tax breaks was sarcastic
Sometime if you come east I’d like to see that beer soaked napkin. In any event I am not going to argue but to say that the lopsided results of free trade are ending.
I am a free trade advocate – nothing more nothing less and have been that way forever. I have repeatedly stated a free trade agreement should fit on a napkin.
Come on now. He gets something like $265 million in tax windfall on joining the administration. How bad can that be?
Mish, never thought of you as a globalist.
Come on now – He gets something like $265 million in tax profits he does not have to pay now. How bad can that be?
Yippy!!! Too bad this didn’t happen before tax reform.