U.S. tariffs on Chinese solar cells fuel debate about green jobs

[annata]

U.S. tariffs on Chinese solar cells fuel debate about green jobs

Some domestic solar manufacturers praised the recent import levy as a victory for job creation, but an analysis of the industry suggests the duty may actually be a job killer.

by Ken Bensinger, Los Angeles Times April 23, 2012, 12:49 a.m.


A simmering trade dispute is highlighting a debate about the kinds of jobs America can sustain in a greening economy.

The Obama administration's recent decision to slap import tariffs on Chinese solar cells was hailedby some domestic solar manufacturers as a victory for job creation, leveling the field while also sending a powerful message to Beijing about monopolistic behavior in crucial industries.

But a close look at the U.S. solar industry suggests that the tariffs may actually be a job killer because the vast majority of positions in the sector aren't on the assembly line. Instead, upward of 70% of U.S. solar employment is in installation, sales and distribution — and companies that hire those workers argue solar cells must get significantly cheaper to remain competitive with other energy sources.

"What China (http://thepoliticalforums.com/topic/intl/china-PLGEO00000014.topic) is doing to boost its manufacturers is unfair, but tariffs could actually reduce jobs," said Gordon Johnson, a green tech analyst at Axiom Capital Management. "The price of solar panels goes up and looks unaffordable compared to alternatives."

Although the U.S. pioneered photovoltaic solar cells decades ago, it has fallen increasingly behind lower-cost manufacturers of the technology, including China, South Korea and Malaysia (http://thepoliticalforums.com/topic/intl/malaysia-PLGEO00000159.topic). But the U.S. is among the world's fastest-growing solar consumers, opening vast opportunities for service-sector jobs in the sunlight-extraction business.

The matter comes to a head next month, when the Commerce Department will announce a determination on a possible second round of tariffs on Chinese-made silicon-based photovoltaic cells, which convert sunlight into electricity and are by far the most popular solar technology.

While tariff advocates say that protecting a solar manufacturing base is crucial to the nation's energy security, others argue the U.S. has already lost that footrace. Instead of swooping in to rescue remaining plants, they say, the focus should be on reducing the cost of solar to speed liberation from fossil fuels, which dovetails with the goal of reducing unemployment.

"Installation is where all the jobs are," said John Smirnow, vice president of trade and competitiveness at the Solar Energy Industry Assn. "There are 5,600 companies in the healthy, vibrant and growing solar-services sector."

TheCommerce Department's May 17 ruling, in response to allegations of dumping by the U.S. unit of a German solar panel maker, could fundamentally alter the solar landscape in the U.S. Dumping is when a company or industry sells its products below cost to capture the market. If additional tariffs are applied, they will probably be much higher than the relatively light first round announced in March, which ran from 2.6% to 4.7%.

The smaller tariffs — designed to balance out Chinese subsidies of its solar factories — could squeeze margins for installers, but most experts agree they aren't enough to radically reduce consumption. Anti-dumping duties, however, could run above 20%, dramatically increasing the cost of switching to solar.

Cost is a key factor in getting businesses and homeowners to convert to solar power. A typical residential roof setup costs about $25,000, which federal, state and local rebates and tax incentives can cut to about $13,000 in the city of Los Angeles. At that price, it still could take about a dozen years for the systems to pay back the upfront costs through lower electricity bills.

If tariffs on Chinese cells come in as high as many predict, they could raise the out-of-pocket cost of such an installation by $1,250 — and commercial projects by far more.

Such an increase could be a deal breaker for many would-be customers, especially with a 30% federal tax credit set to expire after 2016, said Lyndon Rive, chief executive of SolarCity, the nation's largest solar installer.

SolarCity has 1,600 employees in 14 states and is hiring three new employees a day. The San Mateo, Calif., company puts solar panels onWal-Martstores, government offices and university campuses, as well as thousands of houses.

"The No. 1 decision for our customers in terms of going solar is whether they can save money," said Rive, who worries that higher prices could offset government subsidies. Several European (http://thepoliticalforums.com/topic/intl/europe-PLGEOREG0000014.topic) countries are already curtailing solar incentives, he said. "We have to be competitive with whatever the local power company is charging, or we're in trouble."

According to a study by the Solar Foundation, 52,503 Americans worked in the solar installation business last year, and 17,722 worked in sales and distribution, compared with 24,064 in manufacturing. And although almost 10,000 new installation jobs were created in 2010 and 2011, manufacturing actually lost 1,000 positions while seeing several domestic makers go out of business, including Solyndra (http://thepoliticalforums.com/topic/economy-business-finance/energy-resource-industries/alternative-energy/solyndra-llc-ORCRP0017617.topic), which failed despite government loan guarantees.

The growth in service jobs has tracked closely to the falling costs of photovoltaic cells, often the most expensive item in any installation. Thanks largely to aggressive pricing by Chinese manufacturers, the cost of solar panels has fallen 28% in the last 12 months, according to data from research firm Solarbuzz.

Walter Ellard, installation director of SunFusion, a San Diego company with 25 employees, said he pays about 40% more for U.S.-made solar cells than Chinese ones. "Some customers prefer American made, but otherwise it's not even close," he said.

As recently as five years ago, China was a bit player in solar, far behind in both quality and cost. Then the Chinese government threw its weight behind its solar manufacturers, offering low-cost loans and other subsidies, leading to a massive production increase that dwarfed competitors
http://www.latimes.com/business/la-fi-solar-jobs-20120423,0,3951568.story (more)

[Peter1469]

I don't have a problem with tariffs when another nation subsidies and industry so they can undercut American companies.

[Chris]

Tariffs raise prices and costs and thereby, as annata's OP shows, kill jobs.

Manufacturing is in decline, being replaced by service. Might as well bring back horse and buggy.

[Peter1469]

Tariffs raise prices and costs and thereby, as annata's OP shows, kill jobs.

Manufacturing is in decline, being replaced by service. Might as well bring back horse and buggy.

Tariffs imposed as I stated bring prices from below market levels to market levels.

If I were a millionaire and my kids wanted to sell lemonade next to your kids' lemonade stand, how would you feel if I subsidized my kids so they could sell their lemonade for 5 cents while yours had to sell for $1?

That is what tariffs are for.

[Chris]

"Tariffs imposed as I stated bring prices from below market levels to market levels."

Government doesn't have the knowledge needed to centrally plan prices.

"If I were a millionaire and my kids wanted to sell lemonade next to your kids' lemonade stand, how would you feel if I subsidized my kids so they could sell their lemonade for 5 cents while yours had to sell for $1?"

Tell my kids to buy up the lemonade mix and sell it to your kids. Or tell them to go into watermelons because we have that big expansive garden out back.

"That is what tariffs are for."

I understand the intent, the effect is to raise prices on consumers. Road to perdition paved with good intentions.

[Peter1469]

ok


I understand the intent, the effect is to raise prices on consumers. Road to perdition paved with good intentions.

But you do understand that the prices paid for my kids' lemonade are not market prices. I am providing a 95 cent subsidy.

Where is the free market?

[Vilifier of Zombies]

The only jobs are installations, because Chinese cells are flooding the market. Tariffs are essential for all Chinese products, but the benefits take years to realize.

In the short run, it drives up costs to consumers. In the long run, it brings back manufacturing, but the costs for goods remains high.

We have Chinese solar manufacturing going on in Arizona. That helped put Solyndra under. I don't know if tariffs affect these companies?


If they're manufacturing in the United States I'd say that's one way to avoid tariffs - how're we gonna impose tariffs on something that's not being imported but instead built here in the states? Aren't those cells - Taiwanese cells bought by the Chinese? That would be another way to avoid tariffs last I checked.

If it's not solar panels - it's pasta makers - chocolate confectioneries - the auto industry, and so on, this isn't a new never heard of before scenario...

If we're gonna push the Chinese out then look for the Chinese firms to move somewhere else, like Africa - which is what one of the Chinese firms considered doing in the first place, at the end of the day they chose to manufacture here in the US, so long as there's some sort of investment coming in as opposed to no investment whatsoever I don't think it's anything to loose sleep over...my two cents.

[Peter1469]

Here is a good example Chris:

http://www.youtube.com/watch?v=j9IzdSNivr0&feature=player_detailpage

[Vilifier of Zombies]

Here is a good example Chris:

http://www.youtube.com/watch?v=j9IzdSNivr0&feature=player_detailpage

Did he really say that South Korea should be paying us? What kind of precedent would that set? What's to stop someone else from paying us? What if we're getting paid by two opposing forces? We've got the scratch in hand from both - what happens next, do we graft both of 'em for more, whatever pays us more wins? I had to stop listening at that point, Trump is a bit off kilter these days...

25% would be a bit much, maybe some other type of neutral ground, kinda like what's been imposed on Japan in the past - wasn't it a car built by Toyota (Lexus) that was the only car to go through all the stages - from concept to manufacturing/production - to sales, within the borders of the United States in the last couple of decades? Volkswagen, BMW, and Mercedes also have a couple of plants to manufacture some of their more popular models...I think a 25% tariff or else neutral ground could be attainable so long as it's not at the expense of losing investment - foreign or otherwise.

[Peter1469]

I would have no problem with the US taking money for action that had no true impact on our national security interests. That would be about most crap out there. And we could do it is ways that really presented no real risk to us.

[Vilifier of Zombies]

I would have no problem with the US taking money for action that had no true impact on our national security interests. That would be about most crap out there. And we could do it is ways that really presented no real risk to us.

I would think that's the same as South Korea paying for a product/service...or the same as a mafia racket, extortion - pizzo - or even a rudimentary form of jizya in 19th century Algeria.

[annata]

Tariffs raise prices and costs and thereby, as annata's OP shows, kill jobs.

Manufacturing is in decline, being replaced by service. Might as well bring back horse and buggy.China subsidies gave cheaper panels, but the jobs of installation are US jobs. ( installing the imported panels here).

When you tarrif, you get it back at ya. Th Chinese make a cheaper product; weve tried with Solyndra and DOE grants.
Maybe just let the Chinese do the development, aquire installation jobs , without competing for the manufacturing.
China is determined to build/hold their manaufactue capability - let them pour money into improvements.

[RollingWave]

I don't have a problem with tariffs when another nation subsidies and industry so they can undercut American companies.
Agreed in general, though it should be pointed out that American solar industry is also subsidized to a good extend... as is that of just about everyone else...

[Chris]

ok



But you do understand that the prices paid for my kids' lemonade are not market prices. I am providing a 95 cent subsidy.

Where is the free market?

Right, you're kids charge managed prices, and you think I should tell my kids to do the same. No, that's not the free market.

[Chris]

If they're manufacturing in the United States I'd say that's one way to avoid tariffs - how're we gonna impose tariffs on something that's not being imported but instead built here in the states? Aren't those cells - Taiwanese cells bought by the Chinese? That would be another way to avoid tariffs last I checked.

If it's not solar panels - it's pasta makers - chocolate confectioneries - the auto industry, and so on, this isn't a new never heard of before scenario...

If we're gonna push the Chinese out then look for the Chinese firms to move somewhere else, like Africa - which is what one of the Chinese firms considered doing in the first place, at the end of the day they chose to manufacture here in the US, so long as there's some sort of investment coming in as opposed to no investment whatsoever I don't think it's anything to loose sleep over...my two cents.

I think that's a good point. Tariffs only harm your own citizens, push them too high, the Chinese or whoever will just export elsewhere. Same with Keystone, Canada will just ship to China.

Sorry, Trump doesn't impress me.

[Chris]

China subsidies gave cheaper panels, but the jobs of installation are US jobs. ( installing the imported panels here).

When you tarrif, you get it back at ya. Th Chinese make a cheaper product; weve tried with Solyndra and DOE grants.
Maybe just let the Chinese do the development, aquire installation jobs , without competing for the manufacturing.
China is determined to build/hold their manaufactue capability - let them pour money into improvements.

Simple competitive advantage.

[Peter1469]

Right, you're kids charge managed prices, and you think I should tell my kids to do the same. No, that's not the free market.

That is not what I said. I did not compel you to do a thing. You are free to have your kids watch my kids sell lemonade all day so far as I care.

We are talking about tariffs here. Tariffs are imposed by the government. It isn't a great analogy because I was talking about my kids v. your kids. But substitute that for China v. US business.


No, that's not the free market.

And neither is the status quo in my hypo. Perhaps you should teach your kids to ask "would you like fries with that?" Team-member positions at McDonald's aren't likely to be moved overseas.

And this illustrates a failure of libertarianism. They don't seem to have an answer to problems that occur outside the free market, except to make the market freer. It is a great theory, but it gets you nowhere in the real world.

[Peter1469]

As I said...it hurts in the short term. Look what happened when Obama taxed Chinese tires. Everyone was up in arms. I haven't followed up to see if we're back to making tires here yet, but you have to consider the long haul.

If the leveling of the market brings manufacturing back, then tarrifs are ultimately beneficial.

The low prices are artificial, and have destroyed manufacturing here. Ultimately, when the jobs do come back, you see concessions made by labor, that make it easier for US companies to compete. Of course, we are the only nation that forces corporations to spend billions on healthcare, so that issue will have to be addressed before industry can truly compete on the global level.

Yes...the prices will be higher forever. If everyone is employed, it will be a wash. In theory, the machine is running again, and every industry has increased demand.

It takes some painful years, though.

Some things likely need to be made overseas. It doesn't make sense for the US to make cheap crap. We can buy that from China and other places. But we can certainly make quality goods and be competitive.

[Chris]

That is not what I said. I did not compel you to do a thing. You are free to have your kids watch my kids sell lemonade all day so far as I care.

We are talking about tariffs here. Tariffs are imposed by the government. It isn't a great analogy because I was talking about my kids v. your kids. But substitute that for China v. US business.



And neither is the status quo in my hypo. Perhaps you should teach your kids to ask "would you like fries with that?" Team-member positions at McDonald's aren't likely to be moved overseas.

And this illustrates a failure of libertarianism. They don't seem to have an answer to problems that occur outside the free market, except to make the market freer. It is a great theory, but it gets you nowhere in the real world.

"That is not what I said. I did not compel you to do a thing. You are free to have your kids watch my kids sell lemonade all day so far as I care."

But that is your argument here. Your analogy is China is to your kids as the US is to mine, and you advocate government using tariff to level the playing field.

"And this illustrates a failure of libertarianism."

LOL, actually it illustrates the failure of statism. Statists think they can manage the economy and only do harm to the very people they intend to help.

"They don't seem to have an answer to problems that occur outside the free market, except to make the market freer."

It's a solution that works.

Consider the two statist solutions. One, China subsidizes it's manufacturers, but that harms its citizens who must pay for the subsidies, and lowers prices for US consumers. Two, imposing tariffs against China only harms US consumers by raising prices. What good has any of that protectionism done?

Now consider a free market solution. The US drops all tariffs. Chinese citizens subsidize our lower prices. The US dollars that go to China can only be used to purchase US goods. But the Chinese people have less US dollars with which to purchase US goods. We have all the gains and they have all the losses. Eventually they wake up they're doing themselves harm.

[Chris]

As I said...it hurts in the short term. Look what happened when Obama taxed Chinese tires. Everyone was up in arms. I haven't followed up to see if we're back to making tires here yet, but you have to consider the long haul.

If the leveling of the market brings manufacturing back, then tarrifs are ultimately beneficial.

The low prices are artificial, and have destroyed manufacturing here. Ultimately, when the jobs do come back, you see concessions made by labor, that make it easier for US companies to compete. Of course, we are the only nation that forces corporations to spend billions on healthcare, so that issue will have to be addressed before industry can truly compete on the global level.

Yes...the prices will be higher forever. If everyone is employed, it will be a wash. In theory, the machine is running again, and every industry has increased demand.

It takes some painful years, though.

"I haven't followed up to see if we're back to making tires here yet, but you have to consider the long haul."

I suggest you do that rather than speculate.

"If the leveling of the market brings manufacturing back, then tarrifs are ultimately beneficial."

One, you're ignoring the fact that manufacturing is in decline worldwide. Two, you're ignoring the cost to US consumers, the "it hurts in the short term. Look what happened when Obama taxed Chinese tires. Everyone was up in arms."

"In theory, the machine is running again, and every industry has increased demand."

In theory? What theory? Economies are not machines, they emerge from trade and exchange of goods and services between individuals, not between governments.

[Vilifier of Zombies]

I think that's a good point. Tariffs only harm your own citizens, push them too high, the Chinese or whoever will just export elsewhere. Same with Keystone, Canada will just ship to China.

Sorry, Trump doesn't impress me.


The Chinese have read the small print - so they know how to circumvent tariffs, which it turns out - it benefits our citizens as well if they're [Chinese firms] manufacturing here in the states to avoid paying tariffs...

[Peter1469]

"That is not what I said. I did not compel you to do a thing. You are free to have your kids watch my kids sell lemonade all day so far as I care."

But that is your argument here. Your analogy is China is to your kids as the US is to mine, and you advocate government using tariff to level the playing field.

"And this illustrates a failure of libertarianism."

LOL, actually it illustrates the failure of statism. Statists think they can manage the economy and only do harm to the very people they intend to help.

"They don't seem to have an answer to problems that occur outside the free market, except to make the market freer."

It's a solution that works.

Consider the two statist solutions. One, China subsidizes it's manufacturers, but that harms its citizens who must pay for the subsidies, and lowers prices for US consumers. Two, imposing tariffs against China only harms US consumers by raising prices. What good has any of that protectionism done?

Now consider a free market solution. The US drops all tariffs. Chinese citizens subsidize our lower prices. The US dollars that go to China can only be used to purchase US goods. But the Chinese people have less US dollars with which to purchase US goods. We have all the gains and they have all the losses. Eventually they wake up they're doing themselves harm.


That is a great theory, but it doesn't work out that way when no other nation agrees with you. If the US drops its trade defenses, US citizens get cheap stuff. (How much of it is poisoned?) Manufacturing leaves the US. We become a nation dependent upon imports. If we ever become disfavored by enough other countries they can stop exporting to us. Then Americans will be wondering how they are going to get their cheap crap. The only advantage to the US is lower costs for consumer goods (of questionable quality).

China does not lose when the US drops all tariffs. They win- the USD's flooding into their banks make them stronger not weaker. How do you think China's economy has grown at such rates the last decade? And their money is tied to the USD. China loses when the US imposes tariffs. China is not a consumer economy, it is an export economy. If it cannot sell to others it will quickly go into negative economic growth.

The US Constitution is not a libertarian document. It is a document that gives the Federal government sovereign power in limited and enumerated areas. One such area is the control over foreign trade and the laying and collection of tariffs. Tariffs funded much of the early American government. Then the income tax took over. That was a great change.....

Let me know when you find a real country to try out the 100% free market model. I read about it in books. I want to see it in real life.

[Vilifier of Zombies]

Let me know when you find a real country to try out the 100% free market model. I read about it in books. I want to see it in real life.

Well it's certainly not ours - the National Employment Act 1946 with it's Keynesian themed Humphrey-Hawkins Full Employment Act amendment both insist that it's the responsibility of the Federal government to maintain economic stability - the closest thing you'd get to a 100% free market model is the black market or Somalia these days...

[Chris]

That is a great theory, but it doesn't work out that way when no other nation agrees with you. If the US drops its trade defenses, US citizens get cheap stuff. (How much of it is poisoned?) Manufacturing leaves the US. We become a nation dependent upon imports. If we ever become disfavored by enough other countries they can stop exporting to us. Then Americans will be wondering how they are going to get their cheap crap. The only advantage to the US is lower costs for consumer goods (of questionable quality).

China does not lose when the US drops all tariffs. They win- the USD's flooding into their banks make them stronger not weaker. How do you think China's economy has grown at such rates the last decade? And their money is tied to the USD. China loses when the US imposes tariffs. China is not a consumer economy, it is an export economy. If it cannot sell to others it will quickly go into negative economic growth.

The US Constitution is not a libertarian document. It is a document that gives the Federal government sovereign power in limited and enumerated areas. One such area is the control over foreign trade and the laying and collection of tariffs. Tariffs funded much of the early American government. Then the income tax took over. That was a great change.....

Let me know when you find a real country to try out the 100% free market model. I read about it in books. I want to see it in real life.

"If the US drops its trade defenses, US citizens get cheap stuff."

No, people purchase what they value. Criminy, now you're centrally planning what people should purchase.



"China does not lose when the US drops all tariffs. They win- the USD's flooding into their banks make them stronger not weaker. How do you think China's economy has grown at such rates the last decade? And their money is tied to the USD. China loses when the US imposes tariffs."

You've ignored my explanations of the ways in which they lose.



"libertarian"

I'm not arguing libertarianism. Why do you try to divert?



"Let me know when you find a real country to try out the 100% free market model."

Seems to be a standard liberal argument around here. Reframe an argument as extreme--to which the easy counter is why do you propose socialism? Or, everyone else is doing it, so it's OK for us. Two wrongs don't make a right.

[Chris]

Well it's certainly not ours - the National Employment Act 1946 with it's Keynesian themed Humphrey-Hawkins Full Employment Act amendment both insist that it's the responsibility of the Federal government to maintain economic stability - the closest thing you'd get to a 100% free market model is the black market or Somalia these days...

International trade. Society in general, other day I lent my table saw to a neighbor who gave me hydralic pump in exchange, my son (not the one now selling lemonade mix to Peter's kids) cut another neighbors lawn for $20.

[Peter1469]

"If the US drops its trade defenses, US citizens get cheap stuff."

No, people purchase what they value. Criminy, now you're centrally planning what people should purchase.



"China does not lose when the US drops all tariffs. They win- the USD's flooding into their banks make them stronger not weaker. How do you think China's economy has grown at such rates the last decade? And their money is tied to the USD. China loses when the US imposes tariffs."

You've ignored my explanations of the ways in which they lose.



"libertarian"

I'm not arguing libertarianism. Why do you try to divert?



"Let me know when you find a real country to try out the 100% free market model."

Seems to be a standard liberal argument around here. Reframe an argument as extreme--to which the easy counter is why do you propose socialism? Or, everyone else is doing it, so it's OK for us. Two wrongs don't make a right.


No, people purchase what they value. Criminy, now you're centrally planning what people should purchase. Either a straw man or non-comprehension. Which is it?


You've ignored my explanations of the ways in which they lose. I did not ignore it. I discounted it as incorrect. Those less valued dollars fueled massive economic growth in China over the last decade. Of course it is hard to tell for sure since they cook their books....



Seems to be a standard liberal argument around here. Reframe an argument as extreme--to which the easy counter is why do you propose socialism? Or, everyone else is doing it, so it's OK for us. Two wrongs don't make a right.


Maybe I should rephrase. We should have a way to discuss issues in the real world, and we should have a separate forum to discuss theory.

Your theory would 100% spot on in a world where other nations also valued 100% free trade. But in this world, our workers get raped if we fall for one-way free trade. Coons had some good comments in this regard above.

[Peter1469]

International trade. Society in general, other day I lent my table saw to a neighbor who gave me hydralic pump in exchange, my son (not the one now selling lemonade mix to Peter's kids) cut another neighbors lawn for $20.

I undercut you son's lemonade business and he is out of business.

[Vilifier of Zombies]

International trade. Society in general, other day I lent my table saw to a neighbor who gave me hydralic pump in exchange, my son (not the one now selling lemonade mix to Peter's kids) cut another neighbors lawn for $20.

I stand corrected, the black market - Somalia - and you and your neighbor bartering table saws and hydraulic pumps, the other kid, not the one slinging lemonade on the street corner but the one mowing lawns for twenty bucks...

What about Craigslist or garage/yard sales?

[Chris]

I stand corrected, the black market - Somalia - and you and your neighbor bartering table saws and hydraulic pumps, the other kid, not the one slinging lemonade on the street corner but the one mowing lawns for twenty bucks...

What about Craigslist or garage/yard sales?

Craigslist, garage/yard sales--I suppose that could be called blak market.

And International/global trade. At least until the libs manage one world government.

[Chris]

Peter "Either a straw man or non-comprehension. Which is it?"

You tell me, you're the one dictating people buy quality whether they want it or not.

"I discounted it as incorrect."

Something you'd need to show.

"Those less valued dollars fueled massive economic growth in China over the last decade."

And gave US citizens discounted prices paid for by Chinese citizens' taxes and/or inflation. How long do you think they can do that?

"Your theory would 100% spot on in a world where other nations also valued 100% free trade. But in this world, our workers get raped if we fall for one-way free trade. Coons had some good comments in this regard above."

Just showed that false. US consumers gained by it. And it you raise tariffs, you would make them pay. Your theory fails.

And if you think about it, it leads to crony capitalism, with you as central planner deciding which industries to protect to keep your re-election coffers filled.

[Peter1469]

It is getting to hard to follow. Try the quote box next time.

I see that you misunderstood the first point.

I see that all you care about is cheaper prices and not US jobs.

And I see equating even minimal government to central planning is one of those ad hom things you harp about all the time.
Did I miss anything in that blob of un-formatted words?

[Chris]

It is getting to hard to follow. Try the quote box next time.

I see that you misunderstood the first point.

I see that all you care about is cheaper prices and not US jobs.

And I see equating even minimal government to central planning is one of those ad hom things you harp about all the time.
Did I miss anything in that blob of un-formatted words?

Your replies are quoted.

I see you misunderstood my understanding.

I see you are mistaken about what I care about.

I see you misuse "ad hom".

Did I miss anything?

[Peter1469]

Quite a bit apparently.

[Chris]

How many discussions with you turn out you saying no one understands you? Again, I understand the policy you advocate, and its intent, but it fails in consequences. It's classic Bastiat seen and unseen, here: What Is Seen and What Is Not Seen (http://www.econlib.org/library/Bastiat/basEss1.html).

[Chris]

Economics Prof. Don Boudreaux on Free Trade vs. Protectionism:


http://www.youtube.com/watch?feature=player_embedded&v=7njIlZ2xYq0#!

[Peter1469]

Hong Kong is a city. It is not a massive nation like the US. It has no industry to move outside of its boarders. It couldn't sustain itself without favorable trade from other nations.

The US Constitution gives the federal government the power to ensure that trade within our boarders are free (the Commerce Clause). The US has no authority to ensure that trade with other nations is free- how could it do such a thing? The Constitution does empower the federal government to lay tariffs.

Does anyone see a difference between Hong Kong's position and that of the US?

Buler? Buler?

[Chris]

Hong Kong works. So does/did the US.

[Vilifier of Zombies]

Hong Kong is a city. It is not a massive nation like the US. It has no industry to move outside of its boarders. It couldn't sustain itself without favorable trade from other nations.

The US Constitution gives the federal government the power to ensure that trade within our boarders are free (the Commerce Clause). The US has no authority to ensure that trade with other nations is free- how could it do such a thing? The Constitution does empower the federal government to lay tariffs.

Does anyone see a difference between Hong Kong's position and that of the US?

Buler? Buler?

And it's a bastion for black marketeers - that and China still plans on reeling Hong Kong into the fold within a time frame that's said to be over fifty years from 1997 (there's even talk of combining the two currencies early).

China's foreign trade laws are more fluid, easily adaptable for specific circumstances specifically for the benefit of China first then whatever industry/industries [foreign trade business operators] are involved. Lessons learned from centuries of getting pushed around is how it reads. Currently Hong Kong is governed by two systems when we're discussing trade - it's an open economy now but that trend is already changing, starting with stringent oversight of the telecommunications industry.

The difference between the US's trade policies and Hong Kong's are vast, I'm not sure why someone would equate the two...

[Chris]

Both examples of relatively high levels of free trade and the prosperity that comes from trade. Simple. Wasn't that a request earlier?

[Vilifier of Zombies]

Both examples of relatively high levels of free trade and the prosperity that comes from trade. Simple. Wasn't that a request earlier?

Hong Kong's economy is more open albeit that's gonna change...it's safe to assume that those changes will include tariffs.

Have you ever seen the list of tariffs that the US imposes on other countries? As recently as 2002 the US imposed a tariff on steel and as far back as 1789 with the Hamilton Tariff...

[Peter1469]

Hong Kong's economy is more open albeit that's gonna change...it's safe to assume that those changes will include tariffs.

Have you ever seen the list of tariffs that the US imposes on other countries? As recently as 2002 the US imposed a tariff on steel and as far back as 1789 with the Hamilton Tariff...

If Chris were in power all of our essential industries would be gone, but we would get cheaper (many substandard) substitutes from overseas, so long as they wish to provide those goods. But hey, you can't out source doormen, bell hops, and team members at McDonald's!

Would you like fries with that?

[Vilifier of Zombies]

If Chris were in power all of our essential industries would be gone, but we would get cheaper (many substandard) substitutes from overseas, so long as they wish to provide those goods. But hey, you can't out source doormen, bell hops, and team members at McDonald's!

Would you like fries with that?



The hell you can't outsource doormen, bell hops, and Micky D's team members...."¿cómo estás hoy, ¿le gustaría papas fritas con eso."

[Peter1469]

The hell you can't outsource doormen, bell hops, and Micky D's team members...."¿cómo estás hoy, ¿le gustaría papas fritas con eso."

This is immigration my friend. cómo estás! Either way, it is not libertarian theology!

[Chris]

Hong Kong's economy is more open albeit that's gonna change...it's safe to assume that those changes will include tariffs.

Have you ever seen the list of tariffs that the US imposes on other countries? As recently as 2002 the US imposed a tariff on steel and as far back as 1789 with the Hamilton Tariff...

Yes, China could impose protectionist policies and kill Hong Kong.

Yes, the US has always had tariffs, but the point of the video was the US is relatively unrestricted.

Here's a chart, from Index of Economic Freedom 2012 (http://www.heritage.org/index/), comparing specifically trade freedom. Overall in the index, Hong Kong is rated #1, US #10, China #138. To me the question is if we want to improve the US economically, if we want to see greater prosperity, who do you emulate? Hong Kong with greater trade freedom (fewer tarrifs) or China with lesser trade freedom?

http://i.snag.gy/Phxbs.jpg

[Chris]

If Chris were in power all of our essential industries would be gone, but we would get cheaper (many substandard) substitutes from overseas, so long as they wish to provide those goods. But hey, you can't out source doormen, bell hops, and team members at McDonald's!

Would you like fries with that?

Nice straw man argument, Peter. Not worth addressing what you make up out of your imagination.

[Chris]

This is immigration my friend. cómo estás! Either way, it is not libertarian theology!

Another straw man. OK, if you want to play games, I'll take libertarian freedom over your socialist statism.

[Peter1469]

Yes, China could impose protectionist policies and kill Hong Kong.

Yes, the US has always had tariffs, but the point of the video was the US is relatively unrestricted.

Here's a chart, from Index of Economic Freedom 2012 (http://www.heritage.org/index/), comparing specifically trade freedom. Overall in the index, Hong Kong is rated #1, US #10, China #138. To me the question is if we want to improve the US economically, if we want to see greater prosperity, who do you emulate? Hong Kong with greater trade freedom (fewer tarrifs) or China with lesser trade freedom?

http://i.snag.gy/Phxbs.jpg











You swing and miss.

Unless you can get enough other States (read nations) to condemn Chinese protectionism you are setting your own citizens up for failure. This is where the real world gets in the way of really good theory. And yes, it disappoints me too.

Yes I want 100% free trade.

But if China is putting a 10" steel rod up your arse, you don't have free trade. Are you going to sit there and take it? I am not. And tell us to enjoy it as well? I say no! Slap a tariff on that item to erase the Chinese subsidy. Then the products can compete on a fair and level market.


That is you free market. Not the avoidance of it.

[Vilifier of Zombies]

Yes, China could impose protectionist policies and kill Hong Kong.

Yes, the US has always had tariffs, but the point of the video was the US is relatively unrestricted.

Here's a chart, from Index of Economic Freedom 2012 (http://www.heritage.org/index/), comparing specifically trade freedom. Overall in the index, Hong Kong is rated #1, US #10, China #138. To me the question is if we want to improve the US economically, if we want to see greater prosperity, who do you emulate? Hong Kong with greater trade freedom (fewer tarrifs) or China with lesser trade freedom?



You say kill, I'm sure China will think of it as bringing Hong Kong back into the fold.

Neither...the dynamics of our trade development are vastly different from that of China or Hong Kong, my answer would be to figure out what works for us not emulate China or Hong Kong.

[Chris]

Peter, you're arguing in circles. You repeat your opinion between bouts of logical fallacies. Here you combine your opinion with great emotional appeal.

Tariffs are a tax. China doesn't pay it, importers don't pay it, only consumers do. Your good intention to help the US paves a hellish road to higher prices for US citizens. Fair and level markets are liberal arguments that work well in theoretical abstractions like the US vs China, but in practical reality nations don't compete, people trade. Restricting that trade for what you the central planner believes is a higher quality good is not free trade, it's managed trade as bad a Bush pushed through. Why are you against leaving people free to choose the products they value?

Ah, but I repeat myself too even when I know you will turn a blind eye to what I've said and invent your straw men.

[Vilifier of Zombies]

This is immigration my friend. cómo estás! Either way, it is not libertarian theology!

Outsourcing with under the table amigos...

[Chris]

You say kill, I'm sure China will think of it as bringing Hong Kong back into the fold.

Neither...the dynamics of our trade development are vastly different from that of China or Hong Kong, my answer would be to figure out what works for us not emulate China or Hong Kong.

OK, accepting that the dynamics and knowlege is too complex, what works, the pretense a central planner can design and manage economies, or the acknowledgment people left to freely choose do a damn good job of it?

[Vilifier of Zombies]

OK, accepting that the dynamics and knowlege is too complex, what works, the pretense a central planner can design and manage economies, or the acknowledgment people left to freely choose do a damn good job of it?

Well Chris, since you ask - sometimes tools such as tariffs work, if anything - even the threat of tariffs can and have worked in the past.

[Peter1469]

Peter, you're arguing in circles. You repeat your opinion between bouts of logical fallacies. Here you combine your opinion with great emotional appeal.

Tariffs are a tax. China doesn't pay it, importers don't pay it, only consumers do. Your good intention to help the US paves a hellish road to higher prices for US citizens. Fair and level markets are liberal arguments that work well in theoretical abstractions like the US vs China, but in practical reality nations don't compete, people trade. Restricting that trade for what you the central planner believes is a higher quality good is not free trade, it's managed trade as bad a Bush pushed through. Why are you against leaving people free to choose the products they value?

Ah, but I repeat myself too even when I know you will turn a blind eye to what I've said and invent your straw men.


And the majority of Chinese companies that we deal with are owned by the military or the government. Look to your own straw man and see the forest for the trees. You really are just an academic.

I am not arguing in circles. You are arguing from a position if utopia. Stop that. Argue from the position that the the US is in currently.

Or we can start another thread to discuss the perfect free market. But that would be boring unless the "fellow travelers" joined in with their nonsense. You and I would be in 100% agreement.

[Chris]

Well Chris, since you ask - sometimes tools such as tariffs work, if anything - even the threat of tariffs can and have worked in the past.

In what way? Give an example. And please consider how it affected consumers who paid for it.

[Chris]

And the majority of Chinese companies that we deal with are owned by the military or the government. Look to your own straw man and see the forest for the trees. You really are just an academic.

I am not arguing in circles. You are arguing from a position if utopia. Stop that. Argue from the position that the the US is in currently.

Or we can start another thread to discuss the perfect free market. But that would be boring unless the "fellow travelers" joined in with their nonsense. You and I would be in 100% agreement.

"And the majority of Chinese companies that we deal with are owned by the military or the government."

Red herring. Doesn't address the elephant in the room: why you want to tax American consumers with tariffs in order to create your centrally planned utopia.

The rest of your emotional nonsense is ignored.

[Peter1469]

"And the majority of Chinese companies that we deal with are owned by the military or the government."

Red herring. Doesn't address the elephant in the room: why you want to tax American consumers with tariffs in order to create your centrally planned utopia.

The rest of your emotional nonsense is ignored.

Great.

When you are done having all of our business move overseas, with what are our citizens going to use to pay for cheap crap from overseas?

[Vilifier of Zombies]

In what way? Give an example. And please consider how it affected consumers who paid for it.

The Omnibus Foreign Trade and Competitiveness Act for starters, which isn't so much a tariff as it is a barrier or rather an import quota - nonetheless it's still a form of protectionism which I think is a better example than any specific tariff or type of tariff mainly because the idea of it is a somewhat level playing field, what's important is that in some cases tariffs can and have had the same desired effect.

We can bicker back and forth about consumer vs worker all day, the idea however isn't to favor one over the other but instead to find some sort of neutral ground.

[Chris]

Great.

When you are done having all of our business move overseas, with what are our citizens going to use to pay for cheap crap from overseas?

Why are you against leaving people free to choose for themselves?

[Chris]

The Omnibus Foreign Trade and Competitiveness Act for starters, which isn't so much a tariff as it is a barrier or rather an import quota - nonetheless it's still a form of protectionism which I think is a better example than any specific tariff or type of tariff mainly because the idea of it is a somewhat level playing field, what's important is that in some cases tariffs can and have had the same desired effect.

We can bicker back and forth about consumer vs worker all day, the idea however isn't to favor one over the other but instead to find some sort of neutral ground.

But that is exactly what we would need to do, do a cost/benefit analysis of the effects of a quota or tariff. I think that would be impossible, because those who gained, special US businesses would not be those who lost, US consumers in general. Doesn't the Constitution speak to general welfare? Quotas and tariffs are special welfare, special interest, crony capitalism. No, it's not enough to say as Peter does, but we gain in quality goods, because that's his subjective valuation, as opposed to each consumers'. You might be able to argue serving these special interests indirectly increases jobs, increases wealth etc that we all share in, but that's hard to show. You might be able to argue other benefits, like manufacturing related to defending the US militarily, which, if it defends liberty, benefits all. There are arguments for tariffs that might help find a neutral ground, but leveling playing fields isn't one of them.

[dsolo802]

Peter, you're arguing in circles. You repeat your opinion between bouts of logical fallacies. Here you combine your opinion with great emotional appeal.

Tariffs are a tax. China doesn't pay it, importers don't pay it, only consumers do. Your good intention to help the US paves a hellish road to higher prices for US citizens. Fair and level markets are liberal arguments that work well in theoretical abstractions like the US vs China, but in practical reality nations don't compete, people trade. Restricting that trade for what you the central planner believes is a higher quality good is not free trade, it's managed trade as bad a Bush pushed through. Why are you against leaving people free to choose the products they value?

Ah, but I repeat myself too even when I know you will turn a blind eye to what I've said and invent your straw men.Chris, do you regard laws in this country prohibiting child labor to be "managing trade?"

Why is "leveling the playing field" in the form of pulling out of trade agreements that turn a blind eye to child and slave labor, any different in kind from our laws prohibiting child labor and slave labor here?

Do you argue that we should re-institute child labor in this country? Abolition of minimum wage? Abolition of 40 hour work week?

[Chris]

Chris, do you regard laws in this country prohibiting child labor to be "managing trade?"

Why is "leveling the playing field" in the form of pulling out of trade agreements that turn a blind eye to child and slave labor, any different in kind from our laws prohibiting child labor and slave labor here?

Do you argue that we should re-institute child labor in this country? Abolition of minimum wage? Abolition of 40 hour work week?

No.

Not for any sort of managed trade, but how would pulling out of a trade agreement affect child and slave labor? Nations do not trade, individuals do.

No. Yes. Yes. Do you really believe liberal intervention caused those changes?


A general question, do you believe emotionalism leads to rational choices?

[Chris]

I suggest you use the software properly, if you want people to respond.

I suppose you are, and that makes sense?

[Chris]

I understand. We buy millions of tires in this country. It's a perfect illustration of the China issue. Virtually all tires are now manufactured there. I'm guessing environmental issues play a big part of that.

If tarrifs equalized the price of tires, we might get that manufacturing back here. I spoke w/a tire dealer after the tarrif was imposed. He said that all of the tire companies sent their molds to China, and there are virtually none being made here anymore.

He may have been exaggerating a bit.

Some reading here....http://www.nakedcapitalism.com/2009/09/us-tire-tariffs-will-china-retaliate.html

"If tarrifs equalized the price of tires, we might get that manufacturing back here."

At what cost to US consumers? Why do you want to burden them with that? Aren't they the ones you want to help, not harm?

And to what effect, the tire dealer said to no effect, so you doubt him?

[dsolo802]

No.

Not for any sort of managed trade, but how would pulling out of a trade agreement affect child and slave labor? Nations do not trade, individuals do.We - as in our Government, refuse to support child labor at home because it is wrong. Why is it any more right for our Government, through trade agreements - speaking for the People - to support it abroad?


No. Why are you against child labor in the United States?

Does this mean you think laws against child labor are not managed trade when our government refuses to support it here but it would be managed trade if our government refused to support it through treaty agreements abroad? Please explain.


Yes. Yes.So whatever it takes to compete with Communist China and the deplorable way in which it treats its workers is okay with you? I'm just asking. If it were necessary to compete with Communist China, it would you be okay with you if American workers were required to work 60 hour work weeks @ 2.00/hr?


Do you really believe liberal intervention caused those changes?I don't know what you are talking about. I haven't mentioned "liberal intervention" in anything I've written to you, or to anybody else. Could you help me to understand what you are asking?


A general question, do you believe emotionalism leads to rational choices?When did you stop beating your wife? There is no emotionalism in my questions to you. I'm just holding up a mirror. You seem to be clearly making the point that money is more important than many values other Americans believe are much more important.

Other than not bringing child labor back to our shores, it seems to me you are saying American workers are entitled to no greater human rights than the country with the least regard for them. Am I right about that?

[Vilifier of Zombies]

But that is exactly what we would need to do, do a cost/benefit analysis of the effects of a quota or tariff. I think that would be impossible, because those who gained, special US businesses would not be those who lost, US consumers in general. Doesn't the Constitution speak to general welfare? Quotas and tariffs are special welfare, special interest, crony capitalism. No, it's not enough to say as Peter does, but we gain in quality goods, because that's his subjective valuation, as opposed to each consumers'. You might be able to argue serving these special interests indirectly increases jobs, increases wealth etc that we all share in, but that's hard to show. You might be able to argue other benefits, like manufacturing related to defending the US militarily, which, if it defends liberty, benefits all. There are arguments for tariffs that might help find a neutral ground, but leveling playing fields isn't one of them.

That's where we'll have to disagree then, the playing field might not be entirely leveled in our favor with the Omnibus Foreign Trade and Competitiveness Act but it does well to get us closer to that point. Have you ever read that particular Act Chris?

[Peter1469]

Why are you against leaving people free to choose for themselves?

In theory I am not.

In reality, people don't have much of a say about national trade policy. If the US is going to have 100% free trade when several other nations are undercutting prices so that Americans can buy certain products significantly cheaper, America is not better off when its manufacturing base disappears.

I was at the CAPS game last Friday in DC. I wanted to get team Jersey. The one that I was interested in was $86 (the real ones were $210), but it was made in China, so I put it back. Even though it was very over priced for what it was, had it been made in America I would have bought it.

[Peter1469]

"If tarrifs equalized the price of tires, we might get that manufacturing back here."

At what cost to US consumers? Why do you want to burden them with that? Aren't they the ones you want to help, not harm?

And to what effect, the tire dealer said to no effect, so you doubt him?

You realize that the costs of tires are not at market rates if China is subsidizing their manufacturers at 35%?

[Chris]

You realize that the costs of tires are not at market rates if China is subsidizing their manufacturers at 35%?

How is China gaining by paying 35% of the cost for US consumers? If that's what US consumers want, why are you against that? Why do you think you know better what they want? You never respond to these types of questions.

[Peter1469]

I see your point, but much of that cost is licensing. Prob not the best case to illustrate the point.

I guess that you are correct. Someone is making a wind fall on those things.

[Chris]

If it cost you $200.00 more to put 4 tires on your car, would it be worth it to bring jobs back here? Most people use 1 set of tires/year, or less. You wouldn't be willing to pay that extra amount, to bring jobs back?
No, in my subjective valuation, I'd rather save the $200 on tires and pay it toward a new set of rims.

But, unlike you and peter, I'm not dictating what people should trade for, I'm advocating leaving them free to choose.

The problem here, as I see it, is I'm talking about practical individual people and their choices while you and peter and now dsolo are theoretical talking abstractions comparing US and China. Countries do not trade, individuals do.

Even at the level of theoretical abstractions, you all fail to show any cost/benefit analysis of tariffs. You cite slogans, like level the playing field, without concern to who you're harming, who will pay to have it leveled.



"And to what effect, the tire dealer said to no effect, so you doubt him?" means you went to a tire dealer hoping for an answer to support your argument and when he answered the opposite, that the tariff had no effect, you dismissed it. I'm actally suprised you posted an argument that counters yours.

[Peter1469]

How is China gaining by paying 35% of the cost for US consumers? If that's what US consumers want, why are you against that? Why do you think you know better what they want? You never respond to these types of questions.


http://www.epi.org/publication/bp316-china-auto-parts-industry/

China is subsidizing its manufacturing base. And Chinese banks give a lot of loans at the behest of the government and those numbers are in addition to the subsidies.

What do they gain? Social stability. China is an export nation. It is worth more to China to have its large population working to fill export needs than it is to make a profit on that need.

That is why in the other thread on China's advance, I have provided the unpopular view that China is not going to become a superpower. Although all the other commentors seem to be bullish for China.

And I am not substituting my beliefs for what US consumers want. Did US consumers want dry wall tainted with poison? http://chinesedrywallcomplaintcenter.com/indications.htm Of course not. They wanted the least expensive dry wall possible, dry wall is dry wall after all. Except when it off-gases toxic fumes....

So that Chinese drywall did not give the US consumer a cheap product for $X.

It gave the US consumer a cheap product for $x + the cost of replacement, + medical costs. I imagine that is a tad bit over the cost of getting dry wall from a trusted source in the first place.

You are not always saving money when you go with the lowest bidder. And it is not unreasonable that the government step in to prevent toxic dry way from entering the country.

Even if there are some citizens who would buy it because it is "cheaper."

[Vilifier of Zombies]

In theory I am not.

In reality, people don't have much of a say about national trade policy. If the US is going to have 100% free trade when several other nations are undercutting prices so that Americans can buy certain products significantly cheaper, America is not better off when its manufacturing base disappears.

I was at the CAPS game last Friday in DC. I wanted to get team Jersey. The one that I was interested in was $86 (the real ones were $210), but it was made in China, so I put it back. Even though it was very over priced for what it was, had it been made in America I would have bought it.

Clothing and textiles maybe, but other industries such as electronics and it might say that it's made in China but the reality is those components came from a whole bunch of countries - think iPhones, there's a bunch of manufacturers that're involved, the hard drives are made in Japan by Toshiba - the Broadcom chips are made in Taiwan and so on, there's over four hundred and fifty plus parts in an iPhone - what's important to consider is where the bulk of the real value is at, turns out the real value doesn't lie in its parts or even in putting those parts together, the bulk of the iPhone's value is the conception and design - that is, out of every iPhone sold the largest share goes to Apple.

Just because it says it's made in China doesn't mean that the product will lack in quality - same goes for other countries, I'll take an English or German manufactured car over most American cars just because they'll hold more of their value. I go through trucks about every two or three years, my wife goes through Volkswagens (which is strange, I never knew Filipinos could be Fahrvergnügen love'n enthusiasts but she's now driving her third VW in twelve years) every four years and I'll go through a Jag or likeminded coup every five or six years. The point is is that the trucks, which up until recently have always been Ford or GMC trucks are the vehicles that've not held their value all that well, I now have a Tundra and it seems to be holding up just fine, that I haven't put that many miles on it may be a factor but also that it's a well made product I'm sure has something to do with it.

Point is, you probably should've bought that Caps jersey, it might've even been a better product, more so given the price difference and the largest piece of the pie would've went to the American company that came up with the idea in the first place.

[Vilifier of Zombies]

Clothing and textiles maybe, but other industries such as electronics and it might say that it's made in China but the reality is those components came from a whole bunch of countries - think iPhones, there's a bunch of manufacturers that're involved, the hard drives are made in Japan by Toshiba - the Broadcom chips are made in Taiwan and so on, there's over four hundred and fifty plus parts in an iPhone - what's important to consider is where the bulk of the real value is at, turns out the real value doesn't lie in its parts or even in putting those parts together, the bulk of the iPhone's value is the conception and design - that is, out of every iPhone sold the largest share goes to Apple.

Just because it says it's made in China doesn't mean that the product will lack in quality - same goes for other countries, I'll take an English or German manufactured car over most American cars just because they'll hold more of their value. I go through trucks about every two or three years, my wife goes through Volkswagens (which is strange, I never knew Filipinos could be Fahrvergnügen love'n enthusiasts but she's now driving her third VW in twelve years) every four years and I'll go through a Jag or likeminded coup every five or six years. The point is is that the trucks, which up until recently have always been Ford or GMC trucks are the vehicles that've not held their value all that well, I now have a Tundra and it seems to be holding up just fine, that I haven't put that many miles on it may be a factor but also that it's a well made product I'm sure has something to do with it.

Point is, you probably should've bought that Caps jersey, it might've even been a better product, more so given the price difference and the largest piece of the pie would've went to the American company that came up with the idea in the first place.

^^^ I posted this Pete because it's how I justified buying the cheaper yet still pricey Rangers made in China jersey last year at the Garden...fast forward a year and I'm still fine with my reasoning - and my Rangers jersey...

[Chris]

http://www.epi.org/publication/bp316-china-auto-parts-industry/

China is subsidizing its manufacturing base. And Chinese banks give a lot of loans at the behest of the government and those numbers are in addition to the subsidies.

What do they gain? Social stability. China is an export nation. It is worth more to China to have its large population working to fill export needs than it is to make a profit on that need.

That is why in the other thread on China's advance, I have provided the unpopular view that China is not going to become a superpower. Although all the other commentors seem to be bullish for China.

And I am not substituting my beliefs for what US consumers want. Did US consumers want dry wall tainted with poison? http://chinesedrywallcomplaintcenter.com/indications.htm Of course not. They wanted the least expensive dry wall possible, dry wall is dry wall after all. Except when it off-gases toxic fumes....

So that Chinese drywall did not give the US consumer a cheap product for $X.

It gave the US consumer a cheap product for $x + the cost of replacement, + medical costs. I imagine that is a tad bit over the cost of getting dry wall from a trusted source in the first place.

You are not always saving money when you go with the lowest bidder. And it is not unreasonable that the government step in to prevent toxic dry way from entering the country.

Even if there are some citizens who would buy it because it is "cheaper."


China is subsidizing its manufacturing base.
Again, you return to repeat your argument. No one's debating China is subsidizing.


What do they gain? Social stability.
Again you ignore the cost. Its people pay for the subsidies. Seems to me to be a wash.


And I am not substituting my beliefs for what US consumers want
But you are, you're arguing we should use tariffs to control people's choices, to buy what you personal consider quality goods.


Did US consumers want dry wall tainted with poison?
You're changing the topic, you don't use tariffs to protect people, you use information and other regulations and lawsuits. Once consumers found out, they re-evaluated their purchases.


You are not always saving money when you go with the lowest bidder.
Why are you back to that straw man. I never argued for the cheapest goods. I have consistently argued leave the people free to make their own subjective valuations and choices. I did argue against your dictating quality, not because of prices, but again, leave the people free to make their own subjective valuations and choices.

[Conley]

^^^ I posted this Pete because it's how I justified buying the cheaper yet still pricey Rangers made in China jersey last year at the Garden...fast forward a year and I'm still fine with my reasoning - and my Rangers jersey...

And you'll be able to wear it for G7 tomorrow... :grin:

[Peter1469]

Chris you are arguing with yourself.

[Chris]

Clothing and textiles maybe, but other industries such as electronics and it might say that it's made in China but the reality is those components came from a whole bunch of countries - think iPhones, there's a bunch of manufacturers that're involved, the hard drives are made in Japan by Toshiba - the Broadcom chips are made in Taiwan and so on, there's over four hundred and fifty plus parts in an iPhone - what's important to consider is where the bulk of the real value is at, turns out the real value doesn't lie in its parts or even in putting those parts together, the bulk of the iPhone's value is the conception and design - that is, out of every iPhone sold the largest share goes to Apple.

Just because it says it's made in China doesn't mean that the product will lack in quality - same goes for other countries, I'll take an English or German manufactured car over most American cars just because they'll hold more of their value. I go through trucks about every two or three years, my wife goes through Volkswagens (which is strange, I never knew Filipinos could be Fahrvergnügen love'n enthusiasts but she's now driving her third VW in twelve years) every four years and I'll go through a Jag or likeminded coup every five or six years. The point is is that the trucks, which up until recently have always been Ford or GMC trucks are the vehicles that've not held their value all that well, I now have a Tundra and it seems to be holding up just fine, that I haven't put that many miles on it may be a factor but also that it's a well made product I'm sure has something to do with it.

Point is, you probably should've bought that Caps jersey, it might've even been a better product, more so given the price difference and the largest piece of the pie would've went to the American company that came up with the idea in the first place.

Great explanation. Similar to Leonard Read's I, Pencil (http://www.econlib.org/library/Essays/rdPncl1.html). You can't design an economy.



I posted this Pete because it's how I justified buying the cheaper yet still pricey Rangers made in China jersey last year at the Garden...fast forward a year and I'm still fine with my reasoning - and my Rangers jersey...
Exactly what I mean about consumers making their own subjective valuations.

[Chris]

Chris you are arguing with yourself.

Leaving already?

[Chris]

From Adam Smith And "The Wealth Of Nations" (http://www.investopedia.com/articles/economics/09/adam-smith-wealth-of-nations.asp#axzz1t63RJuf1)
Smith, a Scottish philosopher by trade, wrote the book to upend the mercantilist system. Mercantilism held that wealth was fixed and finite, and that the only way to prosper was to hoard gold and tariff products from abroad. This meant that nations should sell their goods to other countries while buying nothing in return. Predictably, nations fell into rounds of retaliatory tariffs that choked off international trade.
The invisible hand would be brought about by Enlightened Self-Interest, Limited Government, and Solid Currency and Free-Market Economy:
Smith wanted the government to follow free-market principles by keeping taxes low and allowing free trade across borders by eliminating tariffs. He pointed out that tariffs and other taxes only succeeded in making life more expensive for the people while also stifling industry and trade abroad.
Smith's famous example,
To drive home the damaging nature of tariffs, Smith used the example of making wine in Scotland. He pointed out that good grapes could be grown in Scotland in hothouses, but the extra costs of heating would make Scottish wine 30 times more expensive than French wines. Far better, he reasoned, would be to trade something Scotland had an abundance of, such as wool, in return for the wine. In other words, because France has a competitive advantage in producing wine, tariffs aimed to create and protect a domestic wine industry would just waste resources and cost the public money.
Ironically
Adam Smith, the champion of the free market, spent the last years of his life as the Commissioner of Customs, meaning he was responsible for enforcing all the tariffs. He took the work to heart, and burned many of his clothes when he discovered they had been smuggled into shops from abroad.

[Chris]

Friedman, 1978, on steel tariffs. He mentions Adam Smith, says virtually no economist has argued for tariffs since. He mentions Bastiat, as I did, on the seen and unseen. He addresses jobs.


http://www.youtube.com/watch?v=j0pl_FXt0eM&feature=player_embedded

[Chris]

More...


http://www.youtube.com/watch?v=BlkQRGZEycI

[dadakarma]

Read "The Shock Doctrine".

[Vilifier of Zombies]

And you'll be able to wear it for G7 tomorrow... :grin:

I know, I haven't washed it since the first game...I hope it'll last through the playoffs if they win.

note: I only wear it for the games, it's not like I roll around in the mud (I would if it guaranteed a victory though) or anything, I just don't wanna jinx it.

[Vilifier of Zombies]

Great explanation. Similar to Leonard Read's I, Pencil (http://www.econlib.org/library/Essays/rdPncl1.html). You can't design an economy.

I disagree[not that it was or wasn't a great explanation but your point about designing an economy], there are plenty of economic schools of thought with plenty of controls - the trick is too find out what works for any given period of time.



Exactly what I mean about consumers making their own subjective valuations.

Some of which fall under the umbrella of our various protectionisms.

[Vilifier of Zombies]

From Adam Smith And "The Wealth Of Nations" (http://www.investopedia.com/articles/economics/09/adam-smith-wealth-of-nations.asp#axzz1t63RJuf1)
The invisible hand would be brought about by Enlightened Self-Interest, Limited Government, and Solid Currency and Free-Market Economy:
Smith's famous example,
Ironically

Smith was a proponent of anti-mercantilism, putting less value on production (workers) in favor of more consumption (consumers), disregarding domestic and foreign investment in the process.

"With employment less than full and Net National Product suboptimal, all the debunked mercantilist arguments turn out to be valid." ~ Paul Samuelson

[Chris]

I disagree[not that it was or wasn't a great explanation but your point about designing an economy], there are plenty of economic schools of thought with plenty of controls - the trick is too find out what works for any given period of time.


QUOTE=Chris;66483]Exactly what I mean about consumers making their own subjective valuations.

Some of which fall under the umbrella of our various protectionisms.[/QUOTE]

I don't disagree that we can make small, local, incremental, experimental interventions, perhaps at the state level.

Seems to me though, listening to Friedman, economists have generally decided tariffs are not beneficial except to special interests.

[Vilifier of Zombies]

Friedman, 1978, on steel tariffs. He mentions Adam Smith, says virtually no economist has argued for tariffs since. He mentions Bastiat, as I did, on the seen and unseen. He addresses jobs.

Paul Samuelson was in favor of tariffs on some exports and he'd wrote a weekly column along side Milton Friedman where they represented opposing sides, of course there are economists that'll argue for tariffs - shortly after Smith's time John Stuart Mill was in favor of exports and in this day and age, aside from Samuelson, Joseph Stiglitz also has also suggested tariffs on exports.

"Virtually" probably means any economist that didn't share his point of view...

[Chris]

Smith was a proponent of anti-mercantilism, putting less value on production (workers) in favor of more consumption (consumers), disregarding domestic and foreign investment in the process.

"With employment less than full and Net National Product suboptimal, all the debunked mercantilist arguments turn out to be valid." ~ Paul Samuelson

Actually, one of my arguments with Smith is he followed a labor theory of value, a source, along with Ricardo, iirc, of Marx's theories.

Is Samuelson another generalist and macro economist? Yep, http://www.econlib.org/library/Enc/bios/Samuelson.html: "...unlike Friedman, he did not and does not have a passionate belief in free markets—or for that matter in government intervention in markets. His pleasure seemed to come from providing new proofs, demonstrating technical finesse, and turning a clever phrase."

[Chris]

Paul Samuelson was in favor of tariffs on some exports and he'd wrote a weekly column along side Milton Friedman where they represented opposing sides, of course there are economists that'll argue for tariffs - shortly after Smith's time John Stuart Mill was in favor of exports and in this day and age, aside from Samuelson, Joseph Stiglitz also has also suggested tariffs on exports.

"Virtually" probably means any economist that didn't share his point of view...

Virtually was my paraphrase, what he actually says is since Adam Smith "hardly any economists" have backed tariffs.


On Samuelson , others disagree with you on his favoring tariffs.

[Vilifier of Zombies]

Some of which fall under the umbrella of our various protectionisms.

I don't disagree that we can make small, local, incremental, experimental interventions, perhaps at the state level.

Seems to me though, listening to Friedman, economists have generally decided tariffs are not beneficial except to special interests.

I'm not gonna down Friedman, even he understood that there were limits to some of his ideas , for example his thoughts on the gold standard from when he was younger and how they differed when he'd gotten older, that showed me that somewhere somehow he was at times a realist.

I'd like to keep in mind though that there are several trains of thought regarding protectionisms from other economists, some of whom also have earned a Nobel Memorial Prize in Economics and are held in just as a high regard as Friedman is. It doesn't mean they're all right or never wrong, just different sides of the same coin - it's good that you've taken an interest in Friedman, it wouldn't hurt to branch out, see what some of the others have to say then decide for yourself what might or might not work.

[Chris]

There was one write up I came across, A Brief History of Free Trade (http://www.stopftaa.org/tag/adam-smith). It summarizes Adam Smith's views, mercantilism, colonial American, and of today says
Free trade in the United States is a very highly contested debate, with strong emotions on both sides, and it has been one of the most debated economic theories since the 19th century. Arguments for and against free trade are not only economic, but are political and social as well. Those for free trade say it promotes prosperity for the country as well as the poor and lower economic classes. Those against say the opposite.
Insofar as this thread has not strayed into illogical tangents, it has done a fairly good job of arguing both sides. That's good, I think.

[Chris]

I don't disagree that we can make small, local, incremental, experimental interventions, perhaps at the state level.

Seems to me though, listening to Friedman, economists have generally decided tariffs are not beneficial except to special interests.

I'm not gonna down Friedman, even he understood that there were limits to some of his ideas , for example his thoughts on the gold standard from when he was younger and how they differed when he'd gotten older, that showed me that somewhere somehow he was at times a realist.

I'd like to keep in mind though that there are several trains of thought regarding protectionisms from other economists, some of whom also have earned a Nobel Memorial Prize in Economics and are held in just as a high regard as Friedman is. It doesn't mean they're all right or never wrong, just different sides of the same coin - it's good that you've taken an interest in Friedman, it wouldn't hurt to branch out, see what some of the others have to say then decide for yourself what might or might not work.[/QUOTE]

I'll listen. I agree, no one's all right and never wrong, we all look at different data from different perspectives.

[Vilifier of Zombies]

Virtually was my paraphrase, what he actually says is since Adam Smith "hardly any economists" have backed tariffs.

Yet there are some that do.


On Samuelson , others disagree with you on his favoring tariffs.

Maybe so, although Samuelson Fifty Major (both a biography and an autobiography) says different, at least with what's beneficial for America with regards to tariffs.

[Vilifier of Zombies]

Yet there are some that do.



Maybe so, although Samuelson Fifty Major (both a biography and an autobiography) says different, at least with what's beneficial for America with regards to tariffs.

^^I think that what Samuelson disagreed with - with regards to tariffs was if and when they're used as a political tool and not an economic tool, I've read papers where he's knocking what they've become not whether or not a tariff is a worthy endeavor - that that's the difference.

[Chris]

Adam Smith wasn't entirely against tariffs either, in some cases he advocated retaliatory tariffs against foreign tariffs: "The recovery of a great foreign market will generally more than compensate the transitory inconvenience of paying dearer during a short time for some sorts of goods."

No hard and fast rules.

To me raising tariffs against China is political and makes little economic sense.