The announcement was a WOW. What made it so were these words from the South Korea spokesman: ” Kim pledged to refrain from further nuclear tests and move toward denuclearization”.
Now we know to proceed with caution, as we are aware three past presidents were taken in by the North. They all claimed “peace” in our time, and were taken. Will this be different?
Well if Kim agrees to truly “denuclearize” that would be a version of winning the cold war without a shot being fired. If they do this and allow unfettered inspections then the world is safer and Trump would have an incredible foreign policy achievement.
At first glance it seems to us like this is serious. That Kim realizes Trump is serious and world leaders have warned him of the consequences. We hope that is true.
What would Kim want in return? A guarantee that the U.S. and its allies will recognize North Korea as a sovereign country and not attack or over throw it. That we cease joint military operations with S. Korea and others in the area. The end of sanctions and world assistance to assist North Korea.
Should we accept that? I would say yes. As long as the weapons are eliminated and inspections allowed they can be part of the world family.
What’s Kim’s out if he is bluffing? I would guess he meets with Trump and comes out of the session calling him a bully and unreasonable to try and sway U.S. citizens and world opinion against Trump. (It wouldn’t take much for the MSM to sympathize with him against the bully President). After committing to S. Korea what he did, he cannot back off in any other manner.
So for now, the world takes a step back from conflict with a chance to make some real progress.
So are the tariffs good or bad? Below we will present two arguments from experts on either side you can read. Pat Buchanan on why they are right and Lawrence Kudlow on why they are wrong. Both are conservatives and have opposite views. Here is link to each, and below the ratings we printed them if you want quick access.
One thought in addition from us. We don’t think this causes a trade war. The reason is simple. Countries are running a huge trade surplus with us. If they decide to retaliate with the tariffs on steel and aluminum by adding tariffs against us, then we would add more tariffs on more goods from them. The rest of the world can’t afford the U.S. cutting them off, they have too much to lose. If we had a trade surplus then that would hurt us.
So we think the world will yell, threaten and talk tough, but in the end try and make a deal with Trump behind the scene to do no more.
However, the tariffs will add cost to any products using steel or aluminum.
Pat Buchanan thoughts:
Lawrence Kudlow thoughts:
Total Viewers WEDNESDAY. Fox regains the lead — barely. Maddow #1,
- Total day: FNC: 1.691 | CNN: 863 | MSNBC: 1.382 | HLN: 204
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PAT BUCHANAN ON TARIFFS:
Why Is the GOP Terrified of Tariffs?
A Commentary By Patrick J. Buchanan
Does Senator Flake think Japan rose to post-war preeminence through free trade, as Tokyo kept U.S. products out, while dumping cars, radios, TVs and motorcycles here to kill the industries of the nation that was defending them. Both Nixon and Reagan had to devalue the dollar to counter the predatory trade policies of Japan.
Since Bush I, we have run $12 trillion in trade deficits, and, in the first decade in this century, we lost 55,000 factories and 6,000,000 manufacturing jobs.
Does Flake see no correlation between America’s decline, China’s rise, and the $4 trillion in trade surpluses Beijing has run up at the expense of his own country?
The hysteria that greeted Trump’s idea of a 25 percent tariff on steel and 10 percent tariff on aluminum suggest that restoring this nation’s economic independence is going to be a rocky road.
In 2017, the U.S. ran a trade deficit in goods of almost $800 billion, $375 billion of that with China, a trade surplus that easily covered Xi Jinping’s entire defense budget.
If we are to turn our $800 billion trade deficit in goods into an $800 billion surplus, and stop the looting of America’s industrial base and the gutting of our cities and towns, sacrifices will have to be made.
But if we are not up to it, we will lose our independence, as the countries of the EU have lost theirs.
Specifically, we need to shift taxes off goods produced in the USA, and impose taxes on goods imported into the USA.
As we import nearly $2.5 trillion in goods, a tariff on imported goods, rising gradually to 20 percent, would initially produce $500 billion in revenue.
All that tariff revenue could be used to eliminate and replace all taxes on production inside the USA.
As the price of foreign goods rose, U.S. products would replace foreign-made products. There’s nothing in the world that we cannot produce here. And if it can be made in America, it should be made in America.
Consider. Assume a Lexus cost $50,000 in the U.S., and a 20 percent tariff were imposed, raising the price to $60,000.
What would the Japanese producers of Lexus do?
They could accept the loss in sales in the world’s greatest market, the USA. They could cut their prices to hold their U.S. market share. Or they could shift production to the United States, building their cars here and keeping their market.
How have EU nations run up endless trade surpluses with America? By imposing a value-added tax, or VAT, on imports from the U.S., while rebating the VAT on exports to the USA. Works just like a tariff.
The principles behind a policy of economic nationalism, to turn our trade deficits, which subtract from GDP, into trade surpluses, which add to GDP, are these:
Production comes before consumption. Who consumes the apples is less important than who owns the orchard. We should depend more upon each other and less upon foreign lands.
We should tax foreign-made goods and use the revenue, dollar for dollar, to cut taxes on domestic production.
The idea is not to keep foreign goods out, but to induce foreign companies to move production here.
We have a strategic asset no one else can match. We control access to the largest richest market on earth, the USA.
And just as states charge higher tuition on out-of state students at their top universities, we should charge a price of admission for foreign producers to get into America’s markets.
And — someone get a hold of Sen. Graham — it’s called a tariff.
Patrick J. Buchanan is the author of a new book, “Nixon’s White House Wars: The Battles That Made and Broke a President and Divided America Forever.” To find out more about Patrick Buchanan and read features by other Creators writers and cartoonists, visit the Creators website at www.creators.com.
LAWRENCE KUDLOW ON TARIFFS
Tariffs Are Taxes
Commentary By Lawrence Kudlow
Tuesday, March 06, 2018
One of the ironies of trade protectionism is that, with tariffs and import quotas, we do to ourselves in times of peace what foreign nations do to us with blockades to keep imports from entering our country in times of war.
Or consider that we impose sanctions on U.S. enemies such as North Korea, Russia and Iran because we want them to feel the economic pain of being deprived of imports. But now, we are imposing sanctions on our own country by punishing with tariffs in order to make Americans more prosperous. If ever there were a crisis of logic, this is it.
President Donald Trump genuinely believes that his steel and aluminum tariffs will save thousands of blue-collar jobs. And we know from our interactions with him that he truly cares about these workers in Pennsylvania, Ohio and other Rust Belt states. We do, too, and we don’t want factories to shut down. But even if tariffs save every one of the 140,000 or so steel jobs in America, it puts at risk 5 million manufacturing jobs and related jobs in industries that use steel. These producers now have to compete in hypercompetitive international markets using steel that is 20 percent above the world price and aluminum that is 7 to 10 percent above the price paid by our foreign rivals.
In other words, steel and aluminum may win in the short term, but the steel and aluminum users and consumers lose. In fact, tariff hikes are really tax hikes.
Some of those 5 million jobs will be put in harm’s way. And if they sell less to foreigners, the trade deficit goes up, not down. Since so many of the things Americans consumers buy today are made of steel or aluminum, a 25 percent steel tariff and 10 percent aluminum tariff may get passed on to consumers at the cash register. This is a regressive tax on low-income families.
Trump should also examine the historical record on tariffs, because they have almost never worked as intended and almost always delivered an unhappy ending.
The Smoot-Hawley tariff of 1929 signed into law by Republican then-President Herbert Hoover gave us the Great Depression and worsened it.
Former President Richard Nixon’s 10 percent import surcharge contributed to the stagflation of the 1970s.
Former President George W. Bush tried to save the steel industry by imposing tariffs on steel, and if those tariffs had worked, we wouldn’t be having this discussion today. We tried to save the color TV industry with protectionist measures, and instead they wiped out the domestic production.
We aren’t persuaded by the Trump administration’s claim that we need to impose these tariffs for national security reasons. Despite stiff competition from imports, many specialty steel producers are doing just fine and actually exporting steel to Mexico and Canada.
Meanwhile, Canada is the No. 1 exporter of steel and aluminum to the United States. Does anyone really believe Canada is a national security threat to the U.S.?
What does worry us is that Canada and Mexico are now both threatening retaliatory tariffs against America. This tit-for-tat trade breakdown could put NAFTA in serious jeopardy. That could inflict severe economic damage to all three nations, and a stock market meltdown.
Trump should continue to make American producers more competitive in global markets through tax, regulatory, energy and other pro-America policy changes that bring jobs and capital back to the United States. That is happening at a furious pace right now, as Trump has made America the best and most reliable place in the world to invest almost overnight. Steel and aluminum import tariffs work decisively against this goal.
In the early 1980s, Reagan invoked anti-dumping provisions against Japanese steel. It was one of his few decisions he later confessed he wished he hadn’t made. Trump will come to learn the same thing, and we hope he does sooner, not later.
Kudlow, Laffer and Moore are cofounders of the Committee to Unleash Prosperity. They served as economic advisers to the Trump campaign. To find out more about Lawrence Kudlow and Stephen Moore and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate webpage at www.creators.com.