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The_Voice_of_Reason

(274 posts)
Fri Jan 27, 2017, 12:05 PM Jan 2017

Can we say INFLATION?

In a trade war with Mexico or China, any tariffs will be paid by WE THE CONSUMERS...can we say run-away-inflation returns to America. Suggest everyone go have a look at inflation under supposed great President Reagan when home mortgages were over 18 percent.

35 replies = new reply since forum marked as read
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Can we say INFLATION? (Original Post) The_Voice_of_Reason Jan 2017 OP
I could not buy a thing during the era 1970-1985 CountAllVotes Jan 2017 #1
My first home loan was at 9 % Yupster Jan 2017 #2
BINGO The_Voice_of_Reason Jan 2017 #6
Only Sort of Voice ProfessorGAC Jan 2017 #8
wander thru the produce aisle and just see how much comes from mexico dembotoz Jan 2017 #3
So now it's the progressive view that the key to a solid middle class is low prices at Wal-Mart? DefenseLawyer Jan 2017 #21
Affordable goods are always a key to a solid middle-class. Hayabusa Jan 2017 #22
Welcome to the Democratic Underground The_Voice_of_Reason CountAllVotes Jan 2017 #4
Thank YOU! The_Voice_of_Reason Jan 2017 #5
I am glad to see you here CountAllVotes Jan 2017 #10
The price of practically everything we buy will be affected by tariffs. An auto plant in doc03 Jan 2017 #7
Which is why The_Voice_of_Reason Jan 2017 #9
china's ecomony depends on our purchases Mosby Jan 2017 #19
I guess Trump is your man then nt doc03 Jan 2017 #23
Trump and the republicans are never going to enact tariffs on anyone Mosby Jan 2017 #31
Economic theory suggests that tariffs taught_me_patience Jan 2017 #11
true, but with a 20% tariff the consumer's share will be plenty painful enough no matter what. unblock Jan 2017 #26
It is better to buy things made by slaves & children in hazardous conditions! Omaha Steve Jan 2017 #12
It may sound like a good thing but you think we can slap on a 20% tariff overnight it won't cause doc03 Jan 2017 #13
Maybe tainted baby food from China is ok with you? Omaha Steve Jan 2017 #15
I don't think poisoning the babies and a 20% tariff are the only two choices, LanternWaste Jan 2017 #16
Have you goggled tainted products imported to the US? Omaha Steve Jan 2017 #17
As far as China I don't think we should ever have bought one damn thing from a doc03 Jan 2017 #24
i agree with the goal, but tarriffs are a very, very crude weapon. unblock Jan 2017 #27
It's funny that because idiot Trump rants incoherently against "free trade" DefenseLawyer Jan 2017 #14
no kidding Mosby Jan 2017 #18
you don't have to be a chicago school economist to know that a 20% tariff on mexico is stupid. unblock Jan 2017 #28
Hyperinflation sarcasmo Jan 2017 #20
Unless people simply do without those products or we produce them here at home. Motown_Johnny Jan 2017 #25
usa-grown alternatives would jack up prices as well. unblock Jan 2017 #30
But not sending that money out of the country is beneficial to our economy. Motown_Johnny Jan 2017 #32
the international economy is a complex beast, and you can't tinker one thing without unblock Jan 2017 #33
The same argument can be made in reverse. Motown_Johnny Jan 2017 #34
i support certain things that would be considered "protectionist" unblock Jan 2017 #35
Currency war, trade war... roamer65 Jan 2017 #29

CountAllVotes

(20,854 posts)
1. I could not buy a thing during the era 1970-1985
Fri Jan 27, 2017, 12:09 PM
Jan 2017

Nope. They'd loan me $40K for a house and that was in 1995!

A car loan was at 16.9% in 1981, so no new car either.

I was in my prime during these times and couldn't buy squat.

Typical for a working WOMAN during this time! Only to get worse now with Dump!



& recommend!!!

ProfessorGAC

(64,417 posts)
8. Only Sort of Voice
Fri Jan 27, 2017, 12:24 PM
Jan 2017

Since simple interest bank accounts were paying much higher interest (like 30 or 40x that of today), the average person did better. The problem with the last 20 years, is that taxes were lower, then the gains were taken and reinvested and net worths quintupled where the only taxation was 15% of the realized money. So those people netted 480% because they only paid 15% on a quarter of the money.

I remember having a passbook account in those days and was pleased with how much the number changed every month.

 

DefenseLawyer

(11,101 posts)
21. So now it's the progressive view that the key to a solid middle class is low prices at Wal-Mart?
Fri Jan 27, 2017, 04:57 PM
Jan 2017

Are we all supposed to be supply-siders now? Count me out.

CountAllVotes

(20,854 posts)
4. Welcome to the Democratic Underground The_Voice_of_Reason
Fri Jan 27, 2017, 12:12 PM
Jan 2017
and welcome to the Democratic Underground The_Voice_of_Reason!!



doc03

(35,148 posts)
7. The price of practically everything we buy will be affected by tariffs. An auto plant in
Fri Jan 27, 2017, 12:24 PM
Jan 2017

in Mexico can't just be loaded on truck and brought back to the US overnight and it would cost billions of dollars to
rebuild here. GM, Ford and Chrysler would lose sales in the short term and it would bankrupt them to relocate their factories
back here. China and Mexico just aren't going to sit back an take his bullshit either. First thing China would cancel that
multi-billion dollar order for airplanes with Boeing and stop buying all those Buicks we make for them. That nut will crash the economy worldwide.

9. Which is why
Fri Jan 27, 2017, 12:28 PM
Jan 2017

I pulled my money out of the stock market...what goes up will come down under Trump, and I look for a late spring early summer crash in the stock market when all his garbage starts hurting average Americans. I have even considered pulling my money out completely and sitting on the cash, but alas inflation worries me.

Mosby

(16,163 posts)
19. china's ecomony depends on our purchases
Fri Jan 27, 2017, 03:05 PM
Jan 2017

The margins are so high on Chinese crap that none of a small tariff would be passed on to the consumer, they can't afford to lose unit sales.

Mosby

(16,163 posts)
31. Trump and the republicans are never going to enact tariffs on anyone
Fri Jan 27, 2017, 08:05 PM
Jan 2017

But free trade is slowly destroying the American middle class. We are openly trading with countries that have no labor, environmental or building standards. A graduated use of tariffs is a way to encourage trading countries to make improvements in those areas, and those that choose to do nothing will pay the highest tariff.

Tariffs are not necessarily designed to move jobs back to the US, manufacturing for example involves a lot of sunk costs, so with or without a tariff tax the company still has to get it's money out of the investment, but with a tariff at least we can equalize trade somewhat and use the revenue for things America needs like infrastructure improvements and maybe a guaranteed minimum income for everyone.



 

taught_me_patience

(5,477 posts)
11. Economic theory suggests that tariffs
Fri Jan 27, 2017, 12:39 PM
Jan 2017

Are borne by both the consumer and the producing company. The entire cost does not flow completely to the consumer.

unblock

(51,974 posts)
26. true, but with a 20% tariff the consumer's share will be plenty painful enough no matter what.
Fri Jan 27, 2017, 06:59 PM
Jan 2017

few businesses can just hand over that much revenue to the government and still function, certainly not agriculture, where profit margins are well below that. even 10% would put drive most businesses under. so most of the cost of the tariff will be borne by consumers. do we really feel good about prices going up by "only", say, 14%?

moreover, there's a knock-on effect in that alternative sellers not affected by the tariff are now in a less competitive market, and so are free to raise their own prices. so consumers will pay more even for food and other products made in the usa.

the fun really starts when people then have to ask for raises in order to afford the extra costs....

Omaha Steve

(99,067 posts)
12. It is better to buy things made by slaves & children in hazardous conditions!
Fri Jan 27, 2017, 01:31 PM
Jan 2017

And keeping the door closed for good jobs here.

Thom Hartman: Tariffs are the Best Way to Keep Jobs in the U.S.: http://www.thomhartmann.com/bigpicture/tariffs-are-best-way-keep-jobs-us

BTW the #2 US import behind oil is coffee. I buy Hawaiian coffee for a reason!



http://wp.unionlabel.org/listings/usa-coffee-co/

USA Coffee Company offers superb Hawaiian coffees for sale on line. Their All-American Union Roast is 100% union from tree to cup: planted and harvested on the island of Kauai by members of the ILWU; roasted, packed and shipped by members of the UFCW. USA Coffee s fine selection includes: International Blend, 100% Kona, Island Paradise, Classic Dark, Decaffinated and Organic — all UFCW roasted, packed and shipped fresh to your door. | UFCW – 1444

doc03

(35,148 posts)
13. It may sound like a good thing but you think we can slap on a 20% tariff overnight it won't cause
Fri Jan 27, 2017, 02:44 PM
Jan 2017

inflation and other countries won't retaliate you are dreaming.

Omaha Steve

(99,067 posts)
15. Maybe tainted baby food from China is ok with you?
Fri Jan 27, 2017, 02:53 PM
Jan 2017

It will cause jobs like Carrier to come home. Watch the video by a leading progressive!
 

LanternWaste

(37,748 posts)
16. I don't think poisoning the babies and a 20% tariff are the only two choices,
Fri Jan 27, 2017, 02:56 PM
Jan 2017

I don't think poisoning the babies and a 20% tariff are the only two choices available to the rational mind, professor.

doc03

(35,148 posts)
24. As far as China I don't think we should ever have bought one damn thing from a
Fri Jan 27, 2017, 06:37 PM
Jan 2017

communist country with slave labor. But we do and it won't be easy to change without a possible economic
disaster. All they have to do is demand payment on their bonds.

unblock

(51,974 posts)
27. i agree with the goal, but tarriffs are a very, very crude weapon.
Fri Jan 27, 2017, 07:06 PM
Jan 2017

better is to require all imports to be produced under comparable conditions to what is required in america.

we have (and should have stronger) protections for worker safety, health, and the environment, as well as minimum pay, etc.

we should hold imports to comparable standards.

this promotes a level playing field for business as well as promoting better treatment of workers world-wide.

it gets us away from the argument that we have to continually hammer workers down in the name of competing with the worst treatment of workers we can find anywhere in the world.

 

DefenseLawyer

(11,101 posts)
14. It's funny that because idiot Trump rants incoherently against "free trade"
Fri Jan 27, 2017, 02:49 PM
Jan 2017

that suddenly many of you have become instant disciples of Milton Friedman.

Mosby

(16,163 posts)
18. no kidding
Fri Jan 27, 2017, 03:02 PM
Jan 2017

I had no idea so many progressives are free trade globalists.

And for the record a 20% tariff to build a wall is crazy, but we should have tariffs on imports, Howard Dean suggested a 5-7% tariff.

unblock

(51,974 posts)
28. you don't have to be a chicago school economist to know that a 20% tariff on mexico is stupid.
Fri Jan 27, 2017, 07:17 PM
Jan 2017

the discussion would be different if the proposal were about a 3% tariff.

i'm not opposed to tariffs in any and all circumstances. in particular, they may be appropriate to protect a limited domestic industry for national/economic security reasons (i.e., so we're not 100% dependent on imports); or to temporarily protect workers in a dying domestic industry so they have a reasonable amount of time to retrain and find other jobs.


in order words, it's a specific solution that may be appropriate for certain specific problems.

but just slapping a gigantic tariff for all imports from one particular nation? what the hell problem is that supposed to solve other than donnie getting joy joy out of being mean to a favorite hate target?

 

Motown_Johnny

(22,308 posts)
25. Unless people simply do without those products or we produce them here at home.
Fri Jan 27, 2017, 06:37 PM
Jan 2017

So lets assume a 20% tariff on strawberries from Mexico. Maybe you don't buy strawberries but instead buy some produce grown in the US. Or maybe you just do without.


How would that cause inflation?




unblock

(51,974 posts)
30. usa-grown alternatives would jack up prices as well.
Fri Jan 27, 2017, 07:22 PM
Jan 2017

if i'm a california strawberry grower and my main competition now has prices 20% higher, well, hey, i can jack my prices up 10%, sell more because i'm now comparatively cheaper, *and* that price hike per strawberry is pure profit!

just responding to market conditions. well, market conditions artificially jacked by a very ill-conceived, gigantic tariff.

 

Motown_Johnny

(22,308 posts)
32. But not sending that money out of the country is beneficial to our economy.
Fri Jan 27, 2017, 08:39 PM
Jan 2017

The more money we send out of the country the weaker our dollar is. By keeping that money in our economy our dollar is stronger which in turn creates more spending power for Americans.


I am not in favor of this arbitrary 20% tariff of Trump's, but I think it is being blown out of proportion. The Mexican economy is only about 1/15th the size of ours and reducing the amount of trade with that country isn't going to be a serious blow to us. I just don't see it as being that big a deal.


Just for the record, I am against multi-national trade deals. I am in favor of simpler bilateral trade deals and see no reason for NAFTA, CAFTA, TPP or any other of these free trade abominations.











unblock

(51,974 posts)
33. the international economy is a complex beast, and you can't tinker one thing without
Fri Jan 27, 2017, 09:03 PM
Jan 2017

affecting other. the beast shifts and rebalances itself.

so, for starters, if the price of mexican imports goes up, consumers of mexican imports (both end consumers and business buying raw materials) won't just cough up the extra money for american substitues. they'll do that in part, but also they'll just cut back. so a higher percentage of a smaller pie is staying in america, which may or may not be better on the whole.

then, the non-mexican alternatives might not be perfect substitutes. if so, machines made to process mexican products may be rendered useless or require wasteful retooling. this is trying to grow an ecomony by throwing a wrecking ball at it. hey, in a sense, hurricanes produce economic activity because of the demand for rebuilding, but no one would advocate it as way to grow the economy.

and of course, it only gets worse if mexico retaliates, which surely it would.

as this issue being blown out of proportion, just because trade with mexico is only about 2% of gdp doesn't mean that upsetting that apple cart can't have a major impact on our overall economy. mexico won't suddenly stop trading with us, but if they did, our gdp would drop by 2%, essentially killing our recovery.

moreover, there's no indication that donnie intends to stop at mexico.

 

Motown_Johnny

(22,308 posts)
34. The same argument can be made in reverse.
Fri Jan 27, 2017, 09:14 PM
Jan 2017

That by creating and expanding free trade "the beast shifted". Our trade deficit is around 50 billion dollars a month and after a while that tends to add up. This needs to be addressed. Acting like it isn't a problem isn't helping.

I am all for revisiting all our trade deals. I think free trade has gone way too far and needs to be reversed. I am fine with this not stopping at Mexico. I hope it doesn't.


This is what the vast majority of people on this site just don't understand. We lost PA, MI and WI this cycle and lost OH so badly that we couldn't even compete there. The Democratic party needs to grasp that people in these states will vote to try and save their jobs. If we let Trump set himself up as a hero for moving toward protectionist trade policies he could win these states again in 2020. That is not acceptable. We damn well better find a way to be competitive in OH, even if we don't win it, or we are screwed throughout the mid-west.

We should have killed the TPP 2 years ago and removed it from the debate in 2016. It is very likely we would have won PA, MI and WI and have a Democrat in the White House right now if we had.






unblock

(51,974 posts)
35. i support certain things that would be considered "protectionist"
Fri Jan 27, 2017, 09:26 PM
Jan 2017

i'm not a blind globalist. i agree that our zeal to expand globally should have been accompanied by thoughtful plans to protect shrinking domestic industries and provide for support and retraining for affected workers.

i would like to see trade deals that incorporate better protections for workers and the environment, and i'm not opposed to tariffs in certain specific circumstances.

the problem is that this stuff requires very careful, complex negotiations. it's a delicate process requiring careful engineering, deep knowledge, a surgeon's touch, and someone who's got their priorities straight.

instead we've got donnie trying to do it. this will not end well.

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