“U.S.” Chamber of Commerce Sides with China

March 16, 2018


There are few groups I despise as much as the “U.S.” Chamber of Commerce.  First of all, let’s be clear about who they are.  It’s not an American organization that promotes American interests.  Rather, the “U.S.” Chamber of Commerce is the U.S. branch of a global trade organization that was founded in France in 1599.  Its mission is the promotion of trade and they consider all trade, regardless of winners and losers, to be good.  If trade benefits China to the detriment of the U.S., then that’s fine with them and they want more of it.  They couldn’t care less that it results in an enormous, unsustainable trade deficit that drives unemployment and poverty in the U.S.

So it should come as no surprise that it opposes any efforts by the administration to restore a balance of trade.  After imposing tariffs on steel and aluminum, the Trump administration is now taking aim at certain imports from China that have thrived on the theft of American intellectual property.  Protecting national security from the theft of such property is a no-brainer, though past administrations haven’t had the guts to do it.  Naturally, the Chamber of Commerce doesn’t like it.  Siding with the Chinese, here’s what they have to say:

U.S. Chamber of Commerce President Thomas Donohue said in a statement on Thursday that such tariffs, associated with a probe of China’s intellectual property practices, would be “damaging taxes on American consumers.”

… Donohue said the Trump administration was right to focus on the negative economic impact of China’s industrial policies and unfair trade practices, but said tariffs were the wrong approach to dealing with these.

… “Tariffs of $30 billion a year would wipe out over a third of the savings American families received from the doubling of the standard deduction in tax reform,” Donohue said. “If the tariffs reach $60 billion, which has been rumored, the impact would be even more devastating.”

… “Tariffs could lead to a destructive trade war with serious consequences for U.S. economic growth and job creation,” hurting consumers, businesses, farmers and ranchers.

Of course, the Chinese wholeheartedly agree:

In Beijing, Chinese foreign ministry spokesman Lu Kang said Donohue’s comments were correct, adding that recently more and more American intellectuals had made their rational voices heard.

“In fact, U.S. trade with China in the past 40 years very objectively reduced American families’ per capita spending burden,” Lu told reporters. “We have said many times, there are no winners in a trade war.”

These statements are loaded with lies about trade that have been perpetrated for decades by globalists and their organizations like the World Trade Organization and the Chamber of Commerce.  Here’s the truth:

  1. Tariffs are not taxes on American consumers.  They’re taxes on the companies who export to the U.S.  They’re incentives to encourage corporations to produce domestically, driving a demand for workers.  They’re incentives to encourage consumers to buy the cheaper, domestically made alternatives.  If some consumers choose to continue buying the more expensive imports, then the revenue from the tariffs enables the federal government to keep individual tax rates low.  In the first half of America’s history, all federal revenue was generated by tariffs.
  2. Tariffs don’t cause trade wars.  All trade is a “war”  and those who run chronic trade surpluses are the winners and those with chronic trade deficits – the U.S. has the worst in the world by far – are the losers.  We’ve been in a trade war since the birth of our nation.  In 1947, with the signing of the Global Agreement on Tariffs and Trade (GATT), the U.S. gave up the fight in the hope that doing so would placate the aggressor nations who had initiated the past world wars.  It’s the global equivalent of local businesses paying “protection” money to local gangsters.  At some point – the point the U.S. has now reached – the extortion becomes too much to bear.
  3. When you have such an enormous trade deficit as the U.S. – the goods deficit now approaching a trillion dollars per year – it’s impossible to come out the loser by imposing tariffs and restoring a balance of trade.  Contrary to the claims of the globalists, costs for American consumers would actually go down when those costs are measured as a percentage of their incomes, which is the only rational way to measure it.  Who cares if prices rise when your wages rise even faster?  That’s exactly what would happen.

Don’t listen to the self-serving traitors like the U.S. Chamber of Commerce.  The tariffs that the U.S. used throughout its history to build itself into the world’s preeminent industrial powerhouse will work again just like they did in the past.  It’s time to force grossly overpopulated nations with bloated labor forces to deal with their own problems.  Americans are tired of footing the bill.  Bring on more tariffs!


No Weaknesses in February Employment Report

March 10, 2018


Ever since the “Great Recession,” as the economy very slowly recovered, there have always been some hidden weaknesses in even the best of reports.  If the economy added a lot of jobs as measured by the establishment survey, the employment level, as measured by the household survey, didn’t measure up.  If the unemployment rate dropped, it was often because some of the labor force had mysteriously vanished.  Or the average work week declined.  Or there were downward revisions to the previous two months.

But not this time.  The economy added 313,000 jobs – much more than expected.  And the growth in employment blew past that figure, rising by 785,000.  The only reason that the official unemployment rate didn’t drop is because the labor force grew by 806,000 – in a month when the total population grew by only 160,000.  So where did all of these workers come from if the economy was at “full employment” as so many “economists” would have you believe?  They came from the labor force backlog that was created by the “mysteriously vanishing labor force” trick employed by the Obama administration.  As a result, the labor force participation rate rose by 0.3%.

And there was more good news.  Manufacturing employment rose by 31,000 and is now up by 125,000 in just the last four months.  The average work week increased by 0.1 hours and wages rose by 0.1% – a modest increase, but one that keeps wage growth year-to-year at 2.6%, which is greater than inflation.  And the numbers of jobs added were revised upward for both December and January, adding another 54,000 jobs.

I’ll admit that the growth in manufacturing employment puzzles me.  Exports haven’t grown at all, while imports have been soaring.  That leaves domestic consumption as the only possible explanation, but GDP (gross domestic product) grew at only a 2.5% rate in the fourth quarter.  Perhaps growth is accelerating in the 1st quarter?  Perhaps manufacturers are beginning to sense that, while the tariffs we’ve seen so far under Trump have been modest, Trump means business with his “America First” approach and they are changing their strategy away from off-shoring and back toward more domestic production.  If that’s what’s happening, and if Trump continues to levy more tariffs to help domestic manufacturers, then the job gains we saw in February may be only a small taste of what’s to come.

Trade Deficit Soars in January

March 8, 2018


The above-linked report, released by the Bureau of Economic Analysis (BEA) this morning, reports that the trade deficit soared in January to $56.6 billion, the worst reading since October 2008.  Here’s a chart of the data, dating back to January of 2010 when President Obama boasted that the U.S. would double its exports within five years:  Balance of Trade.

Exports of manufactured goods fell in January and remain at the same level as March of 2012.  During that time, imports of manufactured goods have risen by $36 billion.  The goods deficit rose to $76.4 billion in January, an annual rate of $917 billion.  The deficit in manufactured goods alone was $68.3 billion, and is rapidly getting worse.  Check this chart:  Manf’d Goods Balance of Trade.  Since Trump took office, the trade deficit has jumped by 16%.

The trade deficit is killing economic growth.  It cut 4th quarter GDP (gross domestic product) growth by 31%.  Without the effects of trade, 4th quarter GDP would have come in at 3.63% instead of the actual figure of 2.5%.  GDP hasn’t grown by 3% since 2005.

This isn’t what Trump promised us.  While tariffs on steel and aluminum would be a good start, what’s needed badly are tariffs that cover the entire spectrum of manufactured products until a balance of trade is restored.  Perhaps with the departure of globalist Gary Cohn from Trump’s economic team, some real progress on trade may finally be possible.

Tariff Hysteria

March 3, 2018


Unless you’ve been living under a rock somewhere, you already know about the tariffs on steel and aluminum imports that Trump announced on Wednesday.  The reaction has bordered on mass hysteria, especially among “economists.”  I put that word in quotation marks because those who present themselves as experts in the field, but either lack the curiosity required to examine the effects of population growth, the biggest factor driving the global economy today or purposely avoid it because the findings would destroy their credibility, aren’t worthy of being dignified with the label.  One such “economist,” representing a “think tank” whose purpose it is to advance the cause of globalization (that is, the fleecing of Americans to prop up the economies of grossly overpopulated nations), described Trump’s tariff plan as a “return to 18th century trade policy.”  Apparently he doesn’t understand that the use of tariffs dominated U.S. trade policy through the first half of the 20th century, transforming the U.S. into the world’s preeminent industrial power and the world’s only “super-power.”

The reaction on Wall Street was swift, with market indexes falling several percent.  But not the stocks of U.S. steel producers.  Those actually rose several percent.  So what does that tell you?  Unlike “economists,” investors are people who put their money where their mouth is.  Investors fear what this move could mean for inflation and the broader economy, but they know very well it’ll be a big boost to steel and aluminum producers.  If tariffs are good for that industry, doesn’t it stand to reason that they’d be good for others if applied to those products as well?  How about autos?  Electronics?  Appliances?  The fact is that every U.S. producer of every category of product where the U.S. has a trade deficit would benefit from tariffs.

Virtually every media outlet since Trump “tweeted” about the tariffs soon after announcing them has quoted him as saying “… trade wars are good and easy to win …” in an effort to make him sound like a buffoon.  At least the above-linked Reuters article does provide the full quote further down in the article:

“When a country (USA) is losing many billions of dollars on trade with virtually every country it does business with, trade wars are good, and easy to win,” Trump said on Twitter on Friday.

Put in the context of our massive trade deficit which, in terms of manufactured goods, isn’t just billions but is now approaching a trillion dollars a year, he is exactly right – a trade war would be a good thing and not only would it be “easy to win,” it’d be impossible to do anything but win and win big.  “Economists” and other countries don’t want you to know that.  They want to scare you with warnings of retailiation by other countries:

Europe has drawn up a list of U.S. products on which to apply tariffs if Trump follows through on his plan.

“We will put tariffs on Harley-Davidson, on bourbon and on blue jeans – Levi’s,” European Commission President Jean-Claude Juncker told German television.

Wow, that shows you how far down the list of products they had to go to find some that they actually import from the U.S.  And “blue jeans?”  Seriously?  Don’t they know that even Levis aren’t made in the U.S. any more?  Regardless, do you really want to go there, Europe?  Go ahead.  Slap tariffs on Harleys and bourbon.  We’ll retaliate with tariffs on cars.  See how you like that!  How long would Mercedes, BMW, Volkswagen, Porsche and all the others survive without access to the U.S. market?

Another popular warning among the globalist fear mongers is that higher prices will be passed along to U.S. consumers.  The cost of every product that uses steel and aluminum will soar.  That’s utter nonsense.  When foreign steel producers have to raise their prices by 25% to cover the tariffs, will their customers continue buying their steel or will they simply turn to American suppliers that weren’t that much more expensive in the first place?  That’s the whole purpose of a tariff – not to collect revenue and make American consumers pay more, but to force the buyers of those products to switch to American suppliers.

There is a legitimate fear among manufacturers that forcing them to pay more for steel and aluminum, even if it’s only slighly more when they switch to American suppliers, will make them less competitive with foreign imports.  Here’s one example quoted in the article:

But home appliance maker Electrolux (ELUXb.ST) said it was delaying a $250 million expansion of its plant in Tennessee as it was worried U.S. steel prices would rise and make manufacturing there less competitive.

OK, Electrolux, would you change your mind if Trump also levied a tariff on imported appliances?  Not only would you go forward with your planned expansion, you’d probably rush to develop plans for more and bigger expansions.  My point is that these tariffs on steel and aluminum are a good start, but to have a real impact on the economy, they need to be levied on virtually every imported product so that, in every case, American consumers will choose the less expensive U.S.-made products.  Will that stoke inflation?  Sure, but not as fast as the demand for labor would send wages up.

Other fear mongers have raised the spectre of another scary scenario, where heavy buyers of U.S. debt, like China, would retaliate by dumping their bond holdings, driving up interest rates and inflation along with it.  Could they do that?  Sure, if they wanted to shoot themselves in the foot.  They’d be driving down the value of their biggest investments.  And let’s not forget that, as the U.S. trade deficit shrinks in response to the tariffs, the U.S. will be issuing less debt.  So the U.S. will be pulling bond issues off the table as fast as China and others try to sell theirs.  The end result is a wash and their “retaliation” will end up only hurting themselves.

The tariffs on steel and aluminum, on top of a few other small, targeted tariffs (like the recent tariffs on washers) are good, small steps.  But they’re nothing compared to what really needs to be done – the application of tariffs across the entire spectrum of manufactured goods.  To do that, the U.S. needs to withdraw from the World Trade Organization.  Or perhaps it doesn’t matter.  The only power the WTO has is to authorize other nations to retaliate – nothing more than they would do anyway, even if the WTO never existed.

A trade war?  We’ve been in a trade war ever since our country was founded.  The problem is that, with the signing of the Global Agreement on Tariffs and Trade in 1947 – the forerunner of the World Trade Organization – the U.S. gave up the fight.  The U.S. laid down and let others begin feeding on it like a swarm of parasites.  It’s high time we put up a fight again.

The Trade Deficit is Bankrupting the U.S.

February 13, 2018

Earlier this past week, the Commerce Department released the trade figures for the month of December.  The news wasn’t good.  The overall deficit jumped to $53.1 billion, the highest since the Great Recession in 2009.  Worse yet, the deficit in manufactured goods soared to a new record of $69.0 billion as a $2.7 billion increase in exports was swamped by a $6.7 billion increase in imports, which rose to $183.2 billion.  Check this chart:  Manf’d Goods Balance of Trade.  This is the 3rd month in a row that the deficit in manufactured goods has set a new record.  This is quite the opposite of what Trump promised during the campaign.  To be fair, the increase in the deficit is due to the improved economy, leaving Americans more willing to open their wallets and buy, and is not due to any trade policy blunders by Trump.  But Trump’s dithering on trade is directly responsible for the lack of improvement.  All we’ve gotten is talk, threats and endless (and pointless, I might add) negotiations (primarily on NAFTA) – nothing more than we’ve gotten from previous administrations for decades.

In another story last week, Congress approved (and Trump signed) a spending bill that ended the brief government shutdown – a bill that grows the national debt by an estimated $1.5 trillion over ten years.  This is on top of the $1.5 trillion added by the Republicans’ tax cut legislation.  And all of that is on top of the $1.5 trillion cost of the American Recovery Act implemented under Obama.  Yesterday, Trump introduced a budget plan that would grow the national debt by $7.5 trillion over the next ten years.

So what’s the relationship?  Why do I bring up the trade deficit and the national debt in the same post?  As I explained in Five Short Blasts, the trade deficit is the root cause of our federal budget deficit.  To understand, draw a line around the United States on a map.  Now, draw arrows that represent cash outflows from that circle and cash flowing in.  The money spent on imports – currently running at about $3 trillion per year – is an outflow.  The money we collect from exports that we sell – currently running at about $2.4 trillion per year – is an inflow.  That leaves a deficit of about $600 billion per year.  If that money didn’t come back in some fashion, every penny of U.S. wealth would eventually be gone.  Every American would be flat broke.  It’s exactly the same as your check book.  Keep taking money out without putting any back in and – well- you know what happens.

So the trade deficit puts us in a huge bind.  Fortunately, though, it presents those countries who sold us those imports with an equal but opposite problem.  They’re now collecting a big pile of U.S. dollars that ultimately have value in only one place.  The U.S. is the only place on earth where U.S. dollars are legal tender.  This means that those countries who sold us those imports now have to reinvest those dollars back in the U.S. in some fashion.  For one, they can use them to buy exports from the U.S. – which they do – but obviously not in equal measure.  What to do with the rest?  Invest in American companies?  That makes no sense.  Those are the same companies that their exports are trying to drive out of business.  So they use the money to buy American debt obligations, or “treasuries.”

The federal government then uses the money collected by selling treasuries to finance deficit spending, thus plowing back into the economy the dollars that the trade deficit took out.  In this way, the federal government is able to keep the economy on a positive footing, maintaining an illusion of prosperity in the U.S.  And the biggest way they do this is by collecting less tax revenue from you than it takes to finance their programs.  Essentially, the federal government subsidizes your income.

Check out this chart.  It graphically shows the relationship between the growth in the national debt and the cumulative effect of the trade deficit:  Cumulative Trade Deficit vs Growth in National Debt.  Notice how closely the two parameters track each other.  Also, you’ll notice that any time the growth in the national debt lags the cumulative trade deficit, a recession is the result – the most recent being the “Great Recession” of 2008.  In the run-up to that recession, Congress focused on reining in the deficit and the result was George Bush’s famous “jobless recovery” from the recession that occurred at the turn of the century.  Home ownership was declining and the housing/mortgage industry turned to sham loans to put people into homes – bad loans that nearly collapsed the entire banking industry.  When Obama took office, he correctly blamed global trade imbalances, and world leaders agreed.  What did they do about it?  Not a damn thing.  Like parasites, they could all agree that they were killing the host, but all continued to hungrily feed on it.

So how bad is the national debt?  Let’s begin with a little historical perspective.  In 1929, the national debt was $16.9 billion dollars, which was about 16% of GDP (gross domestic product).  By the end of World War II, it had understandably ballooned to $269.4 billion, or 121% of GDP – unacceptably high.  By 1973, it was whittled back down to only 33% of GDP.  Then it began to grow again.  Not coincidentally, in 1975 the U.S. ran its last trade surplus and became a “debtor nation.”  Soon after, the national debt began to explode.

Some economists have used the benchmark of the GDP to gauge the seriousness of the debt.  As long as it doesn’t exceed 100% of GDP, they would claim, the national debt is manageable.  Where do we stand now?  Take a look at this chart of national debt, measured as a percentage of GDP:  National Debt as Percentage of Chained GDP(2).  We’re back over 100%.  It actually declined slightly last year as the budget deficit shrank a little and as the GDP grew more than it has in years.  We’re not likely to see it decline again any time soon as the national debt is now expected to grow by $7 trillion in the next ten years.  Although it took 32 years to climb from 32% of GDP to 100% in 2013, it will hit 200% in much less time if nothing is done about the trade deficit.

However, the situation is actually worse than that.  The “GDP” isn’t the one who is on the hook for the national debt.  It’s taxpayers – you and me.  So let’s take a look at the national debt in per capita terms – that is, how much of it each one of us owes.  Take a look at this chart:  National Debt Per Capita, 1929-2017.  This should scare the hell out of anyone.  Each of us is now on the hook for $50,000 of the national debt, which is 2-1/2 times the burden of each American at the end of World War II!  And look at this chart:  National Debt as Percentage of Total Household Net Worth.  In 1962, the national debt was only 3% of the total household net worth of all Americans.  Today, it’s hovering near 30%.

“Total household net worth” includes some very wealthy households, like those of Bill Gates, Warren Buffet and other billionaires.  Where does your household’s net worth fit in?  Take a look at this chart of household net worth, as measured by the Federal Reserve in its tri-annual survey of household finances:  Household Net Worth.  While the “mean” (or average) household net worth has grown nicely  from $163,000 in 1962 to $692,000 in 2016, the “median” value remains stuck at about $100,000 where it’s been for two decades.

You need to understand the difference between “mean” and “median.”  If nine people have $1 in their pockets and a tenth person has $100 in his pocket, then the “mean” value of what these ten people have in their pockets is the total divided by the number of people which, in this case, is $10.90.  The “median” represents the value at which half of the people have more and half have less.  In this case, the “median” value of how much these people have in their pockets is only $1.  Half of these ten people have $1 or less, and half have $1 or more.  (One of them has a lot more!)

This means that the household net worth of at least half of all Americans is $100,000 or less.  And, in all likelihood, most of the other half don’t have a whole lot more than $100,000.  The median value is skewed by only a small percentage of households.

On average, a household has 3.2 people.  Remember that each American “owes” $50,000 of the national debt.  That means that each household owes about $160,000 on the national debt.  Compare that to the median household net worth of $100,000.  In all likelihood, if the amount you owe on the national debt were subtracted from your net worth, you’d be completely broke.  You’d actually be “in the hole” by about $60,000!

To be honest, I’ve been hearing warnings about the national debt for all of my nearly seven-decade life.  So far, nothing really bad has happened.  At some point, you have to begin to wonder if those who claim that the national debt doesn’t matter are right.  Who knows how this might actually turn out?  Nobody knows.  Will Americans ever have to pony up the money to pay the debt?  I doubt it.  It’s in no one’s interest to bankrupt Americans.  After all, the rest of the world depends on us continuing to buy their products.  What is likely to happen, in my opinion, is the same thing that has happened in other cases where nations have been unable to repay their debts.  There will be a “debt-forgiveness” program of some sort, perhaps overseen by the World Bank, that will let us off the hook, but will come with some extremely harsh concessions – a Greek-style austerity program as a minimum.  The U.S. will become a slave-state for the rest of the world, never again able to exert any influence over world events or even our own destiny.

Is that what we want?  There’s only one escape from this dilemma – the restoration of a balance of trade.  The only way to make that happen is through the use of tariffs.  It’s exactly what Trump proposed during his campaign but now seems unwilling or unable to implement.  Where is the media outrage over this situation?  Instead of the news being dominated by stories of our looming economic demise – which it should be, all we get is stuff that more properly belongs in tabloids or on page 20 of The Times, at best.  It seems that our journalists are either too ill-informed on the subject of economics to probe the issue, or are too lazy to bother looking into it.  The salacious “she said, he said” stuff is easier and sells better.  It’s not exactly “fake news” but, in the grand scheme of things, it’s certainly trivial news.  There are much more important things, like the trade deficit and the national debt, that needs our focus.

An example of how dumb we’ve gotten about trade

February 1, 2018


I came across the above-linked article a couple of days ago.  It reports on reaction by officials in Clarksville, TN to Trump’s newly-announced tariffs on washers and parts.  It seems that Clarksville is the site of a new washer manufacturing plant planned by LG Electronics.  It’s a good example of just how dumb Americans have become about trade and tariffs.  It seems that the mayor and others reacted with hand-wringing, fearful that LG would now cancel their plans to build the plant to retaliate against the Trump move.  Here’s what the mayor had to say:

“It’s like déjà vu for Clarksville, to say ‘how can this be happening twice to us,’” the city’s mayor, Kim McMillan, told Reuters.

She said that the city government was scrambling to help the South Korean manufacturer accelerate its production launch by ensuring that utilities and infrastructure are quickly put in place at the factory site and expediting approvals.

“We’ve got to do whatever we can to make sure that LG is able to still open their facility and hire people,” McMillan added.

What’s to stop LG from opening their plant?  The whole purpose of tariffs is to encourage foreign manufacturers to locate their production in the U.S.

Trump’s decision to impose 20 percent to 50 percent tariffs on washer imports and parts has local officials asking what his “America First” stands for: supporting all U.S. manufacturing jobs or just favoring traditional American brands over foreign rivals.

How dumb.  Tariffs favor domestic manufacturing over imports, and have nothing to do with favoring any one brand over another.

LG told U.S. retailers on Wednesday it would raise prices in response to the tariffs. That could dent its market share, reducing initial output and employment, said company spokesman John Taylor.

Of course they’d have to raise prices on imported washers!  That’s the whole point!  If they want to hang onto their market share, they have no choice but to move their manufacturing to the U.S.

It’s probably unfair of me to label the Clarksville mayor as “dumb.”  It’s not a matter of being dumb.  Rather, it’s an example of how effectively the globalists have brain-washed Americans about the supposed benefits of free trade and the supposed dangers of protectionist trade policies like tariffs.  Does no one ever wonder why protectionist policies work so well for the rest of the world but can’t be used just as effectively by the U.S.?

The effect of these tariffs will be to accelerate LG’s plans to move to the U.S., along with Samsung and any other foreign manufacturer.

Before I was able to finish writing this, a follow-up article appeared on Reuters the next day, and it drives home the point I’m trying to make.  Here’s the article:  https://www.reuters.com/article/us-usa-trade-samsung/u-s-washer-tariffs-put-samsung-lg-supply-chains-through-the-wringer-idUSKBN1FJ0LZ.  This time, the reporters interviewed officials from LG and Samsung about how they plan to react to these tariffs.  Not only do they plan to accelerate the construction of their washer assembly plants, but the fact that the tariffs also apply to parts has forced them into their “worst case scenario” for their supply chain – they’ll have to manufacture the parts here too.

After committing hundreds of millions of dollars to build the plants and bring jobs to South Carolina and Tennessee, the ruling caught the companies by surprise and was a “worst case” scenario, according to one executive.

Samsung says it will use imported parts until its factory runs at full capacity and becomes ready to produce key parts, expected to be by the end of the year.

…  LG was set to start production at its new plant in the third quarter at the earliest and is now working to accelerate its launch with officials in Clarksville, Tennessee who are eager for the jobs the new factory will bring.

“We had several scenarios… this safeguard measure turned out to be the worst case one,” Kim Gun-tai, head of LG’s home appliance division told a conference call last week.

LG, which announced a plan to raise prices on its washing machines sold in the United States last week, said in a separate statement to Reuters it was absorbing a significant portion of the tariff on parts. Once its U.S. plant’s operation began it would produce key parts on site, it added.

So there you have it.  Both LG Electronics and Samsung are now working feverishly to not only finish their assembly plants but to also ramp up production of the washer components in the U.S., something they hadn’t planned to do until they learned that the tariffs would apply to parts as well as assembled washers.

Tariffs work.  They force companies – both domestic and foreign – to manufacture in the U.S. in order to remain profitable.  Just imagine if similar tariffs were applied to every product.  Our economy would absolutely explode in a way that few ever dreamed possible.


Trump’s “Shithole Countries” Remark

January 17, 2018

I’ve been torn about whether or not to comment on this controversy since, by its nature, the topic violates my own site rules about the use of profanity.  Since it has now become so central to the debate over immigration, however, it’s impossible for me to ignore, since immigration is one of a few topics that lies at the core of my campaign against destructive population growth.

Let’s back up a bit and examine what it was that elicited such an angry response from Trump.  In exchange for generously offering to not just change the temporary status of DACA immigrants (“deferred action childhood arrivals” – kids brought here by illegal aliens) to permanent status, but to even grant them a path to citizenship, Trump insisted on three additional things:

  • an end to “chain migration,” the visa program that allows immigrants to apply for visas for family members, who then are eligible to bring in more family members – creating an endless and exponentially expanding flow of immigration,
  • an end to the “diversity visa lottery” program, which brings in another 50,000 immigrants per year from countries who are “under-represented” in the general U.S. population,
  • funding for the border wall, currently estimated at $18 billion.

These are reasonable immigration reforms that most Americans agree with.  He had said that he was willing to sign any bill that met these criteria.

So here’s the bill that senators Dick Durbin (D) and Lindsey Graham (R) brought to him:

  • DACA immigrants would be barred from the chain migration process.  The 690,000 DACA “kids” would not be able to apply for re-entry for their parents.  Otherwise, chain migration continues as usual for other immigrants, probably numbering somewhere around 25-30 million.
  • The “diversity visa lottery” program would end, but the 50,000 immigrants would be reallocated to other visa programs.
  • Only about 10% of the border wall funding was included, plus a little more funding for other “non-wall” border security.
  • Extending “temporary protected status” to 437,000 immigrants from El Salvador, Honduras, Haiti, Nicaragua, Sudan, Somalia and Yemen.

In other words, Durbin and Graham tried to play Trump for a fool, offering him a bill that did absolutely nothing to rein in our out-of-control immigration, if anything making it worse.  It’s no wonder that he was incensed enough to lapse into the use of a vulgarity in a “behind the doors” meeting.  Most people would in that situation.

Durbin saw an opportunity to stir up hysteria, characterizing Trump’s remark as “racist.”  It was nothing of the sort.  While there is no formal definition of the word “shithole,” it’s clearly a vulgar term used to describe a foul place, not a person or people.  In terms of poverty, political corruption, violence, extremism, a failure to meet basic human needs and a denial of human rights, these are foul places.  Places like El Salvador, Honduras, Nicaragua, Sudan, Somalia, Yemen and others (unfortunately disproportionately represented by Africa) are, in fact, “shitholes.”  That’s not meant to demean the people of those countries, but their unfortunate circumstances.  If a country is so bad that no one – not even its own citizens – wants to live there, then it is a shithole.

Trump then reportedly went on to ask, “why don’t we bring in more people from places like Norway?”  (Trump had just visited with the prime minister of Norway and, reportedly, was highly impressed.)  It’s this contrasting of Norway with the aforementioned places that may have hinted at racism, a suspicion that has dogged Trump beginning with this comments about Mexican immigrants early in his campaign.  Is Trump a racist?  I don’t know.  What I do know for sure is that Trump is a “money-ist.”  He’s been all about money his whole life.  So while African countries are black and Norway is snow-white, it’s also true that African countries generally rank right at the bottom in terms of GDP (gross domestic product) per capita while Norway ranks at the very top – well above the U.S.  So was he really expressing a preference for wealthy, merit-based based immigrants or a preference for white immigrants over black immigrants?  He has said all along that he wants a more merit-based immigration system.  (By the way, just as an aside, Norway is one of many countries that does not have birthright citizenship, unlike the U.S.  Just being born there doesn’t make you a citizen.  Birthright citizenship is something else I’d like to see Trump address.)

Since the hysteria erupted over the “shithole” epithet, Lindsey Graham has characterized it as a “shithole show,” and has blamed Trump and his staff.  Baloney.  Graham and Durbin are to blame for pushing him over the edge when they tried to sucker him and play him for a fool.  They tried to play the American people for fools, like they always do.  They believe that if you polish a turd shiny enough to make it look like an apple, the American people will swallow anything.  The American people elected Trump to put an end to this crap.

Now they’re trying to back Trump into a corner, threatening a government shutdown if he doesn’t agree to this immigration sham.  I hope he doesn’t.  It’s time to stand firm and force a real change in our out-of-control immigration policy.  Let the government shut down.  If Congress doesn’t want to reform immigration in exchange for Trump’s generous offer to give the DACA kids a path to citizenship, then they don’t really care about the DACA kids.