As Chrystia Freeland tries to hammer out a new NAFTA deal, Paul Krugman writes about Donald Trump's tariffs:
Trump’s tariffs really are a big, bad deal. Their direct economic impact will be modest, although hardly trivial. But the numbers aren’t the whole story. Trumpian trade policy has, almost casually, torn up rules America itself created more than 80 years ago — rules intended to ensure that tariffs reflected national priorities, not the power of special interests.
So far, Trump has imposed tariffs on about $300 billion worth of U.S. imports, with tariff rates set to rise as high as 25 percent. Although Trump and his officials keep claiming that this is a tax on foreigners, it’s actually a tax hike on America. And since most of the tariffs are on raw materials and other inputs into business, the policy will probably have a chilling effect on investment and innovation.
But the pure economic impact is only part of the story. The other part is the perversion of the process. There are rules about when a president may impose tariffs; Trump has obeyed the letter of these rules, barely, but made a mockery of their spirit. Blocking imports from Canada in the name of national security? Really?
As the fight over Supreme Court nominee Brett Kavanaugh confirms, Trump corrupts everything he touches:
As with so many other things, Trump has basically abrogated the rule of law and replaced it with his personal whims. And this will have a couple of nasty consequences.
First, it opens the door for old-fashioned corruption. As I said, most of the tariffs are on inputs into business — and some businesses are getting special treatment. Thus, there are now substantial tariffs on imported steel, but some steel users — including the U.S. subsidiary of a sanctioned Russian company — were granted the right to import steel tariff-free. (The Russian subsidiary’s exemption was reversed after it became public knowledge, with officials claiming that it was a “clerical error.”)
Beyond that, America has thrown away its negotiating credibility. In the past, countries signing trade agreements with the United States believed that a deal was a deal. Now they know that whatever documents the U.S. may sign supposedly guaranteeing access to its market, the president will still feel free to block their exports, on specious grounds, whenever he feels like it.
And that, in a nutshell, is the problem Canada faces. Even if we sign a new NAFTA deal, there is no guarantee that Trump will live by its rules.
Image: Me.me
9 comments:
The United States of America has so little self-respect.
That's because they elected a president who is all ego and no brain, Deacon.
It is Trump's deeply-rooted pathology to dominate everyone and everything that must deal with him. His land development history demonstrates that his word means little to Donald Trump. He freely betrayed his lenders, investors, even tradespeople. What drew him into Russia's influence but the refusal of American bankers to lend him a dime after he repeatedly screwed them? What property developer alienates every creditor?
How then can Canada deal with this psychopath?
That's exactly the right question, Mound. And that's why we should be in no rush to make a deal.
The most annoying thing about the ignorance on display in Trump's use of the "national security" fallback in imposing tariffs at will or on whim or, as another example, in Ford's use of the notwithstanding clause to trash the guys who thwarted his dictatorial ambitions in Toronto, is that these buffoons, together with many of their admirers, actually believe that they're demonstrating a measure of bold and distinctively inventive brilliance. Just look at that moronic grin Ford has been sporting so often since he took that "tool" out of his toy box, or watch for the next time Trump comes out with some ridiculous pronouncement and either throws his head back like Mussolini or puts on that idiotically serious facial expression that he mastered while lecturing the backstabbers that were kissing his ass on "The Apprentice".
Another tool in the box: Rules? We don't need no stinking rules. Rules are for chumps.
I get the idea that Trump is fully aware of his dishonesty and regards it rather as an ability to lie somewhat convincingly, as a personal trait that contributes to his perceived success as a negotiator of deals. But he's either dishonest past the point of any possible utility or just too stupid to realize it when his lies and deception have ceased to be of any value to the achievement of his aims and may even be counter productive to that purpose as well as destructive to the parties he's engaging. The perpetuation of that destructiveness is what matters. It takes on a life of its own; success in that endeavour can become confused with success in achieving the original goals. Naturally, he has no respect for any deal that he makes. I'm surprised that he could ever have acquired a repeat customer in his business dealings. But the world is full of rubes with little or no sales resistance.
Yes, we don't know if he will live up to any agreement he signs, so why would Canada sign any agreement which didn't at a min. give us a dispute resolution system which word work for us.
Wal Mar is already notifying customers their prices will be going up. If those prices go up and Wal Mart is already saying "its not our fault",
Trump needs those tariffs because he defunded his country when he cut a trillion dollar tax break for his 1%er friends
No deal is better than a bad deal.
That's precisely the point, John. The world is full of rubes. And Trump thinks Canadians are rubes.
Trudeau keeps repeating that line, e.a.f. But Trump doesn't think he's serious. We will soon get to see if Trump is right.
I'd like to publish your comment, Anon, but it neeeds to be initialled.
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