Trump Should Reconsider His Tariff War with China

by: Brent Smith at the Common Constitutionalist

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Now let’s not get ahead of ourselves on this.

Most of us have heard that the Trump administration has a plan to “temporarily” aid American pork, dairy and soy bean farmers to the tune of about $12 billion. This is as a result of China raising its import tariffs on those American products as retaliation for Trump’s tariff increase on Chinese goods.

Many it seems have written about this as if it’s already happened. Well, it hasn’t.

As Conservative Review writes, “News of the supposed plan was leaked to the media by anonymous sources, so it is possible that this is just an idea being floated to see how the public reacts.”

However, if true, it’s a bad idea. Government “assistance,” no matter how temporary they claim it to be, is just a bailout. No different from any other bailout. And that’s never a good thing for the American people.

And as an aside, how many government assistance programs can you name that were ever really temporary. How about none. read more

Has the Tariff War Begun?

from Zero Hedge:

Here It Comes: China About To Launch “Tens Of Billions” More In Tariffs

This morning the market has been on edge over, and traders are obssessed with just one question: how will China retaliate to Trump’s trade war and tariffs… further. After all, the initial response of a modest 15-25% tariff on $3 billion in 128, mostly agricultural, products, seemed laughably small and appeared to be more of a warning shot than a real response to Trump’s $50BN in Section 301 tariffs.

One answer was revealed moments ago when as we reported that China’s ambassador to the US Cui Tiankai did not rule out the possibility of scaling back purchases of Treasuries in response to Trump’s tariffs. read more

Innovation Born of Necessity

by: Brent Smith at the Common Constitutionalist

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I am firmly against excessive tariffs. I’ve made that crystal clear on a number of occasions. Reasonable tariffs on imported goods are well… perfectly reasonable. At our founding, it was the source of federal government funding. Reasonable import tariffs (imposts) and duties covered the cost of operating the small federal government budget. It paid for the labor and clerical work of the importation and inspection process. As the feds were responsible for little else constitutionally, tariffs were an adequate funding system.

But these days, tariffs could not hope to cover the cost of operating the federal leviathan. They are now more a measure of protectionism worldwide. And I agree that on the world stage, America has allowed itself to be taken advantage of. Other nations expect America to charge minimal import tariffs and duties for the goods they export to us, but few reciprocate.

Nations like China do in fact take advantage of us. They expect us to treat them fairly, but often charge exorbitant tariffs on products we ship to them. And that’s assuming they accept our exports at all. In many cases, they simply do not. They don’t wish to compete with American imports on their own soil. For a long time, it has been rather one-sided.

And for just as long, the American government has put up with inequity, afraid to make waves. Enter President Trump. read more