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The Wall Street Journal has the complete timeline in Turnover Under Trump.

Here's today's victim.

Gary Cohn

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A reader today accused me of being a "globalist".

Based on that definition, I certainly am not. I do not advocate economic planning of any kind. It's ridiculous.

I do not know whether Cohn is or not.

I can say I am a free trade advocate. A great agreement can fit on a napkin as I have stated many times.

Free Trade Proposal

My proposal: "Effective immediately all tariffs and all subsidies on all goods and services are eliminated."

That's it. And it holds whether or not any other nation does the same.

If other countries want to subsidize the US, so much the better for US consumers.

Pater Tenebrarum at the Acting Man blog pinged me with an interesting comment today on this subject:

"Exchanging pieces of paper with a vague promise of payment for real goods strikes me as an excellent deal. It is basically is an exchange of nothing for something. The idea that the US trade deficit is somehow a disadvantage seems even more flawed from that perspective."

Please read that over and over again until it sinks in.

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His comment was in response to Let's Eliminate the Trade Deficit! Yeah, What If?

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Not Easy to Win

Trade wars are not easy to win, for the simple reason that no one wins trade wars.

Kindergarten Math

Kindergarten Arithmetic suggests the same thing.

If Trump extends his wall to cover the entire border, instead of just the one shared with Mexico, and then bans or punitively tariffs every single good that uses steel as an input, recursively, as well; he just may succeed in driving up the domestic price of final goods, to the point where both nominal labor compensation and nominal raw materials prices can be increased at the same time.

In doing so, he will ensure that not a single American made product of any kind, will be internationally competitive over time. This is exactly what the Latin American import substituting “structuralists” did, back in the 50s and 60s.

The above analysis from reader "Stuki" is obviously correct.

Here's an excellent comment by reader AWC: "Now Mish, don't you know that all the world's central planners know more than all the world's markets and all the world's market participants? "

Hard Math

For a mathematical explanation of trade deficits, please see Trump's Tariffs Show He's "Clueless About Trade".

When did This Start?

Finally, it's important to recall what allows these deficits in the first place.

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For details, please see Disputing Trump’s NAFTA “Catastrophe” with Pictures: What’s the True Source of Trade Imbalances?

Maybe this is all part of a gigantic bluff by Trump. But what if it isn't?

Mike "Mish" Shedlock