Trump's Nationalism and Protectionism: Economic Suicide?

[IsaacGage860]

Throughout the Trump campaign and leading up the the election I have spoken with many people online and some in person about Trump's Nationalist platform and his ideas for economic protectionist oriented policy. I certainly do empathize with where most if not all of the people who supported Trump in the US and in Europe are coming from in terms of cultural deterioration and wanting jobs to come back to the US but there are some flaws with protectionism as economic policy. Allow me to explain:

 

The problem with protectionism remains the same as it has always been. If we decide to impose high tariffs onto all of the imports from China or Korea or Mexico or wherever those foreigners will just stop sending their much less expensive products to the US or decide to impose tariffs on our exports thus canceling out the effect and intention of the policy. This would be fine I suppose if you are able to afford the premium that would be charged for "Made in America" products. The reason prices will go up is because Americans will not accept "slave wages" that are often associated with sweat shops and factories over seas. However, the problem is millions of people will not be able to afford it or just will not buy the products or services for the sake of keeping costs down if it is possible to find these things elsewhere for cheaper. You cannot have high wages and low costs at the same time. You have to pick one or the other. Personally, I would much rather have my cheap Chinese products because it is employing people there and in other countries thus allowing them to get out of poverty.The lifting off people out of poverty is a result of globalization and not Nationalism.

 

Also if you want to stop the migrant crises in the future, one good first step would probably be to stop blowing shit up in those countries and attempting to nation build. After all if YOU had your home blown to bits you would be pretty pissed off at whomever had done it and would then need somewhere to live. The foreign policy of the United States has to be dramatically changed so that we stop having all of these crises and so that Globalization can finally stop being so vilified. The free movement of people and ideas is the reason we even have the Internet. If people will not accept curtailing of freedom in this regard then how can you reject it when it comes to borders? I get that you have to keep troublesome people who are not looking to improve their lives or contribute to society out of your countries, but you can do that without punishing the people who want genuinely want to contribute.  

 

The big issue is that a whole bunch of Statists are not interested in peace. The US always has to go in and invade some random country because of an evil dictatorship. Instead of allowing the country to settle its own disputes and perhaps intervene in a diplomatic way, we have to start 15 year wars that cost trillions of dollars and leave us with wounded veterans who will never be the same. I find it  very difficult to see any reason or benefit to continuing on into the future with this type of foreign policy. 

 

Libertarian philosophy and economic models never work because people in this country worship at the altar of a proactive, aggressive military and Crony Statism is most other areas. I am not condemning the military or anything our service men and women do per se. I would just like for the Department of Defense to maybe actually focus on defense. Invading sovereign nations may satiate your bloodlust in the short term but it's the economic prosperity of future generations that suffers as they are the ones who have to deal with the consequences financial or otherwise.

 

I think a lot of Nationalists have never been to those foreign countries to see the working conditions and how they have improved. Granted at first they were bad, but we do not live in a vacuum. Working conditions can always change and do. So when people describe sweat shops as "slave labor" I have to ask them "As compared to what?" Working in fields without, as of yet, the benefit of modern agricultural technology? Prostituting themselves in order to put food on the table? You have to consider what will happen in these other countries as a result of companies like Apple or Nike or whomever coming back to the US. Now all of those Vietnamese, Chinese, African, and South Americans of all walks of life have nothing and have to resort to perhaps in less dignifying means of survival.

 

Again, I see where most of you are coming from with the Nationalism and the cultural aspect in both the US and in Europe, but it is still economic suicide. Unless the wages of every single person in the country go up and up significantly how are we going to pay for the "Made in America" premium price? Feedback as always is greatly appreciated. 

[Thus_Spake_the_Nightspirit]

Some things are more important than the economy. Speaking only for myself, I'll take a shit economy over demographic and cultural suicide any day. Besides, people buy way too much crap they don't need anyway, so maybe they'll start being more responsible with their purchases and demanding better quality products if they are more expensive and harder to get. I'm sick of living in a consumer-driven, throw-away society.

[Rventurelli]

The problem with protectionism remains the same as it has always been. If we decide to impose high tariffs onto all of the imports from China or Korea or Mexico or wherever those foreigners will just stop sending their much less expensive products to the US or decide to impose tariffs on our exports thus canceling out the effect and intention of the policy. This would be fine I suppose if you are able to afford the premium that would be charged for "Made in America" products. The reason prices will go up is because Americans will not accept "slave wages" that are often associated with sweat shops and factories over seas. However, the problem is millions of people will not be able to afford it or just will not buy the products or services for the sake of keeping costs down if it is possible to find these things elsewhere for cheaper. You cannot have high wages and low costs at the same time. You have to pick one or the other. Personally, I would much rather have my cheap Chinese products because it is employing people there and in other countries thus lifting allowing them to get out of poverty.The lifting off people out of poverty is a result of globalization and not Nationalism.

 

The free movement of people and ideas is the reason we even have the Internet. If people will not accept curtailing of freedom in this regard then how can you reject it when it comes to borders? I get that you have to keep troublesome people who are not looking to improve their lives or contribute to society out of your countries, but you can do that without punishing the people who want genuinely want to contribute.  

 

Libertarian philosophy and economic models never work because people in this country worship at the altar of a proactive, aggressive military and Crony Statism is most other areas. I am not condemning the military or anything our service men and women do per se. I would just like for the Department of Defense to maybe actually focus on defense. Invading sovereign nations may satiate your bloodlust in the short term but it's the economic prosperity of future generations that suffers as they are the ones who have to deal with the consequences financial or otherwise.

 

I think a lot of Nationalists have never been to those foreign countries to see the working conditions and how they have improved. Granted at first they were bad, but we do not live in a vacuum. Working conditions can always change and do. So when people describe sweat shops as "slave labor" I have to ask them "As compared to what?" Working in fields without, as of yet, the benefit of modern agricultural technology? Prostituting themselves in order to put food on the table? You have to consider what will happen in these other countries as a result of companies like Apple or Nike or whomever coming back to the US. Now all of those Vietnamese, Chinese, African, and South Americans of all walks of life have nothing and have to resort to perhaps in less dignifying means of survival.

 

Again, I see where most of you are coming from with the Nationalism and the cultural aspect in both the US and in Europe, but it is still economic suicide. Unless the wages of every single person in the country go up and up significantly how are we going to pay for the "Made in America" premium price? Feedback as always is greatly appreciated. 

 

I am afraid that you are making too many assumptions here and also a false dichotomy. Please be sure that I am not accusing the honourable gentleman of doing the false dichotomy on purpose. Also I totally agree with stop invading other countries to impose Democracies on them.

 

It is not because we have protectionist policies, in the sense of imposing tariffs, that those need to be "high tariffs" in "all of the imports". When the United States and Britain were heavily industrializing, they had the highest tariffs in the world, it was only when they already had a sizable industry and were at or near the technological frontier of the day that they cut down on tariffs[1]. Those tariffs averaged 45 percent.

 

What would be the tariffs like? They do not need to be that high to start having a positive effect and they do not need to be imposed in all countries and all products in an uniformed manner, unless you are playing Victoria 2. It would be absurd to tariff raw materials or agricultural products that the United States does not produce, or absolutely cannot produce in sufficient quantities (like coffee). Tariffs could be directed only at manufactured goods, they could be directed to all of them, to specific countries or to particular companies.

 

Let us say a more realistic scenario, probably like what Donald Trump could actually try to do: Mr. Trump is aiming to reduce the corporate tax from 35 percent to 15 percent, that is a 20 percent of tax revenue that the government is not taking anymore and is already helping to boost the productivity of our industry. That, however, increases the hole in the budget. So how about a 25 percent tariff in manufactured goods that we still produce in America, including, but not limited to cars? That is a historically moderate to low tariff and is not high enough that would make it impossible to sell products here. If the companies wanted to avoid those taxes, they could just open factories here and would not need to pay the tariffs!

 

Oh, that would increase the overall price of goods by a significant margin! True. But the American worker would also have more money to spend due to the job preservation and creation here, cancelling that effect and, there is no better social program than a job: people would feel less alienated and would have more proud in themselves, being able to have good paying jobs without the need to go to college and get a huge student loan with no guarantee of a decent paying job afterwards.

 

About preferring to have cheap Chinese goods so those people at least have jobs, again the 25 percent tariff would still have the Chinese products on the lower end of prices. If a country economy can only survive by child porn or by selling opium (Afghanistan before Taliban) would you purchase drugs or child pornography to support the country? Not only it would not be moral, it would give incentives for those countries to keep doing it. My opinion is that we should look to our own group first, as everyone else does.

 

The reason we have the internet is the Cold War, nothing to do with the freedom of movement of people.

 

In my opinion Libertarianism does not work because it takes for granted the idea that people are rational, when most people are not rational and cannot understand, even if we explain to them, why the Welfare State does more harm than good by rewarding vice and punishing success and virtue.

 

[1] Kicking Away the Ladder - Ha-Joon Chang