Trump Orders US Businesses To Find Alternative To China (wsj.com) 473
President Trump said Friday U.S. companies were "hereby ordered" to start looking for alternatives to doing business in China after Beijing said it would impose tariffs on $75 billion worth of additional U.S. products. From a report: "Our Country has lost, stupidly, Trillions of Dollars with China over many years," Mr. Trump wrote in a series of tweets [Editor's note: the link may be paywalled; alternative source]. "They have stolen our Intellectual Property at a rate of Hundreds of Billions of Dollars a year, & they want to continue. I won't let that happen! We don't need China and, frankly, would be far better off without them." Mr. Trump's comments came in response to China's plan, laid out Friday, to impose tariffs of 5% and 10% on almost all the remaining U.S. imports on which it has yet to impose punitive taxes, including vehicles and car parts, in retaliation against U.S. moves to slap punitive tariffs on an additional $300 billion of Chinese goods.
The president demanded that U.S. companies "immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA." The sharp escalation in the prolonged trade conflict between the two countries comes weeks after Mr. Trump said he would impose the fresh tariffs on Chinese goods and Beijing had vowed to retaliate. China's new levies on U.S. goods are set to go into effect on Sept. 1 and Dec. 15, timed with the next two rounds of U.S. tariffs on Chinese goods. Chinese tariffs on U.S. automotive goods are set to begin Dec. 15.
The president demanded that U.S. companies "immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA." The sharp escalation in the prolonged trade conflict between the two countries comes weeks after Mr. Trump said he would impose the fresh tariffs on Chinese goods and Beijing had vowed to retaliate. China's new levies on U.S. goods are set to go into effect on Sept. 1 and Dec. 15, timed with the next two rounds of U.S. tariffs on Chinese goods. Chinese tariffs on U.S. automotive goods are set to begin Dec. 15.
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Re:Export Ratio (Score:5, Insightful)
Depends on the industry. US soybean farmers are definitely feeling the pinch.
Only the smaller ones (Score:5, Interesting)
Like Gore Vidal used to say: Socialism for the Rich and Dog eat dog capitalism for the working class.
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I wonder how long until the US has a class of ex-farmer nobility, just sitting around and receiving government money for being of noble farmer blood.
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Unfortunately, what actually happens is that small family farms fail because they can't get all the same big fat government checks. They are then bought up by large agribusiness. Looking at the actual effects of this trade war, one might even think this was all part of the plan, because it sure works out well for the very wealthy.
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Just google the worst aspects of the Common Agricultural Policy.
You can tell its good, anytime anyone even thinks of changing it, the French farmers are out on the streets burning lorries and causing a fuss.
https://www.theguardian.com/en... [theguardian.com]
Hannah Martin, of Greenpeace UK's Brexit response team, said: "It is untenable for the government to justify keeping a farming policy which allows a billionaire to breed racehorses on land subsidised by taxpayers.
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That's an oddball case of the UK application of CAP rather than EU work in general. The remainder is more like the GP said: insurance blanket to allow farms to continue if crops fail. But then it's no surprise that countries will prop up their farming businesses. The last thing you want is the Australian model: Let the farms fail and sell to the highest bidder during bankrupts proceedings. That high bidder typically being some Chinese investor who has zero interest in providing food for the local country.
Th
Re: Only the smaller ones (Score:5, Interesting)
Also all other sorts of protections. Argentina (where I'm from) has been trying to sell to the US for decades now. The US has tried to bully "free trade agreements" with us that will give us preference in low tariffs.
Except OTHER barriers, like FDA or whatever, still hold up. So basically our products would have no TARIFFS to go to the US, but any low level officer with a rubber stamp can return a shipment, for whatever reason.
We've been denied entry of everything we produce. Our beef is banned "potential foot and mouth disease", even though there hasn't been a case in over a decade.
We sold ONE shipment of lemons to the US and that was it.
OTOH, the US constantly sues Argentina for "protectionism".
Re: Only the smaller ones (Score:5, Interesting)
I don't know of any other industry where if you don't sell your product, the government will pay you.
I don't know of any other domestic business that, if it collapses, means that the population must decide between either widespread malnutrition/starvation or being at the mercy of food-exporting nations.
It's almost as if having a secure & stable domestic agricultural base was a matter of national security, public health, and societal well-being, but that's just crazy-talk.
Right?
Strat
More sources (Score:3)
Politico [politico.com]
USA Today [usatoday.com]
The Guardian [theguardian.com]
Re: Export Ratio (Score:2)
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Depends on the industry. US soybean farmers are definitely feeling the pinch.
Other big imports are high end semiconductors, including CPUs. China will move away from US made chips such as Intel, and toward companies like AMD which manufacture in Taiwan. In the long run, they will learn to make their own high end semiconductors, which they will then export to the entire world. If Intel wants to keep the Chinese market (the world's biggest), they will have to move more of their manufacturing overseas.
Another big Chinese import is aircraft, but they mostly abandoned Boeing long ago,
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Intel does the vast majority and all its high-end wafer fabrication in the US. The packaging operations (putting the silicon dies into plastic or ceramic packages) is done overseas.
How China will interpret that is up to them.
Re:Export Ratio (Score:4, Informative)
That's not really due to tariffs, but African swine flu that swept through China causing millions of pigs to be slaughtered, and the farmers no longer needing soy beans for feed.
Re:Export Ratio (Score:5, Interesting)
US soybean farmers are definitely feeling the pinch
Can confirm, two farms not far from where I live went belly up while trying to cut through the red tape on that farmer's bailout. About three weeks ago they held an auction for the land for one of the farms. Bank broke up the lots into 12 acre sections. Every single one was bought by a developer for housing that'll more than likely go for $350k starting out for zero lot line housing, which more than likely will be bought by investors for rentals or airbnbs to be priced in the $1k/month area.
The city I live in is quickly turning into a suburbia dumpster fire. Our county board just had to approve a 0.4% tax hike because the majority of the officers that work at the County Sheriff's office can't afford to live in the county with rents going up at insane rates and new housing being outside of reach by anyone who didn't get in during the housing crash.
Re:Export Ratio (Score:5, Informative)
Actually not quite, because lots of Chinese exports are the final assembly of parts they imported from Japan, South Korea, Taiwan, Europe, and the US too. So the Chinese export figure combine the trade deficits from around the world and pass over under the Made in China label. Such labeling is completely misleading.
Conversely, lots of US exports to China are not seen obviously because they are either internal valuable components or raw materials like corn and soybeans that goes to their agriculture production. Before the trade war, few Americans were even aware that China has been a major market for American agriculture products because the mainstream media tend not to mention it.
The US trade war is launched based on falsified, exaggerated, or hypocritical accusations and fueled by populism, like the Iraq War.
Re: Export Ratio (Score:4, Interesting)
The US trade war is launched based on falsified, exaggerated, or hypocritical accusations and fueled by populism, like the Iraq War.
So the right thing - if decades late - by the wrong people for the wrong reasons?
Regardless, the trade imbalance still needed to be addressed.. or most of us are going to end up even more fucked than we already are.
Re: Export Ratio (Score:4, Interesting)
The iraqi war was not the right thing to do EVER. Kuwait was slant drilling into Iraqs oil. We came to their aid only to keep oil prices low, not on some major morality thing.
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What I wonder is why Trump isn't working to have some new large scale, versatile, factories built in the US.
Because things like factories don't spring into existence overnight, they take years of planning. No one is going to take the risk to invest large dollars or start a large-scale business venture in this country with this erratic toddler of a president in office.
Businesses like stability, and this so-called president is an unpredictable idiot-clown who lies constantly- not exactly a recipe for stability or for being able to forecast events.
Why keep the money flowing overseas at such a large scale? Automate what can be automated here, not there.
Yeah, great idea, I'm sure Trump will get right on it and it'll be a
Re:Export Ratio (Score:5, Insightful)
The US trade war is launched based on falsified, exaggerated, or hypocritical accusations and fueled by populism, like the Iraq War.
Which part of China systematically manipulating currency, forced IP transfer, forced local partners, and general IP theft on an industrial scale is falsified or exaggerated? You can chalk it up to even a broken clock is correct twice a day but Trump is the first president in ever to seriously address the China elephant in the room. That needed to be addressed and honestly it should have happened much sooner. Still, better late than never.
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This has nothing to do with actual exports or imports but monetary policy. The stock market surge from October-November 2016 (before the election) was caused by investors waiting for months to see how the US Federal Reserve was going to plan out interest rates on government debt. When it was known that the interest rates would rise, the money being held for Treasuries was put into the stock market. Trump took credit for the stock market rise but it began before he was elected.
The major tax breaks for the we
Re:Export Ratio (Score:5, Insightful)
Follow the fucking money, that's how. In real life, the most damaging "conspiracies" are not arranged by shadowy figures in back rooms. They emerge from the individual actions of powerful people who share class interests. A rich man does not need to sit down with other rich men to figure out what things act in the interests of the rich.
Re:The History of Wars (Score:5, Funny)
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The US trade war is launched based on falsified, exaggerated, or hypocritical accusations and fueled by populism, like the Iraq War.
Well, in the 1980's we had a War On Drugs.
Then, in the 2000's, we had a War On Terror.
Now in the 2010's we have a War On Trade.
Did I miss any Wars On Something . . . ?
Does anyone want to speculate about what the next Something our next War will be on . . . ?
You missed the mother of all of them - the War on Poverty. It's cost the most, around 15 Trillion, so more than the rest of these combined. It was started by President Johnson (D) in 1964. As we still have plenty of poor people I guess that war was not won. Indeed we seem to want to lose it even more badly by importing millions of additional poor people. Citation: https://en.wikipedia.org/wiki/... [wikipedia.org]
Re: Export Ratio (Score:2)
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I doubt the US would even really notice China's import duties.
GM is bankrupt (again) without their China sales. *shrug*
Overall very the trade imbalance that sends so much US money net to China means we have all the negotiating power. They need us much more then we need them.
Ideally of course we'd have trade without any tariffs, but it's time to end the decades-long situation of China imposing huge tariffs on imports from the US while we welcome everything their factories can churn out.
Re:Export Ratio (Score:4, Insightful)
with short-term supply chain relocation increased expense
That's a cute way to say "hundreds of billions of dollars".
China can't just "find new buyers" outside the US.
Please stop giving us Americans a bad name by being so utterly uninformed about the rest of the planet.
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Doesn't China export far far more to the US than it imports from them?
I doubt the US would even really notice China's import duties.
Long term both China and US lose. Not just from the obvious cost to consumers and lost sales dues to pricier goods in overseas markets.
Big companies won't want to build in either country and get caught up in the tariff mess. Both countries lose jobs over this. Trump is hoping he can be the biggest asshole in the room and that Winnie the Pooh will just back down- problem is Poohbear can be an asshole too; both countries lose.
Re:Export Ratio (Score:5, Insightful)
A decade ago trade with the U.S. was more like 15% of China's GDP and over 30% of their international trade, so a trade war then would've hurt China a lot more than it would hurt the U.S. But today I don't think it'll make much difference to either country. The U.S. will have an easier time of it though. Not just because its a smaller fraction of our economy, but because we're predominantly the buyer (run a trade deficit with China). All that'll happen for us is that stuff that used to be made/assembled in China will now be made in Vietnam, Thailand, Malaysia, etc. It might cost a bit more at first as factories and suppliers there need to be built and developed. But long-term it'll probably end up even cheaper than China since Chinese labor prices have nearly tripled in the last decade [statista.com]. The only wild card is that China has developed an incredibly tight supply chain for building things like electronics. If you discover a batch of capacitors you were going to use are bad, you don't order a new batch and wait 2 days for them to arrive while your factory sits idle. You just drive a couple blocks to the supplier, pick up a new batch, and resume factory operations. How that advantage stacks against the disadvantage of higher labor prices, I don't know. I guess we're about to find out.
China OTOH can't just find new buyers. The only way they can replace the lost U.S. sales is if they sell to another country, which then turns around and sells to the U.S. In that case, the higher markup due to adding a middleman would result in reduced sales. Or if the U.S. buys from a manufacturer in a different country, which forces other countries who used to buy from that manufacturer to buy from China instead.
It's amusing/sad to see the media emphasizing only the negative aspects of this for the U.S. (like soybean exports) just because they don't like Trump. I don't like Trump either, and think trade wars are generally stupid. But objectively, the U.S. does have the upper hand in this. Just wish the media would stop editorializing mainstream stories like this, and report it objectively. A decade ago they were decrying all the jobs being outsourced to China. And now that a President is doing something about it, they're suddenly only able to report the negative aspects of it just because it's Trump doing it.
In the grand scheme of things, we're just going where we would've gone faster. Shifting manufacturing and production to places where it's cheaper is how the market equalizes incomes and standard of living. Jobs and production get shifted from areas with high labor costs and high standard of living, to areas with low labor costs and low standard of living. Resulting in those poorer areas becoming richer. Eventually they become so rich and expensive, that producing there is no longer an advantage. Which creates an incentive to move production to a different location with low costs. China's average wage (urban) has been increasing for a while now, so trade war or not, U.S. companies were eventually going to seek to move production out of China to other countries.
Plastic (Score:3)
Easier to mold and doesn't chip. Some types can be recycled.
This is what we should be doing already (Score:3, Interesting)
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Re: This is what we should be doing already (Score:2)
So, we are trusting a communist country with a horrifying human rights history with businesses that have been known to literally lock employees in the facility and not let them leave for extended periods of time until they go crazy and try to kill themselves...
Should've gone MacArthur [on their leadership] when they rolled into Tibet.
We saw this coming.
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Re:This is what we should be doing already (Score:5, Insightful)
Whataboutism is irrelevant.
The US made changes to the law and other regulations to outlaw those practices. We should only trade with companies who have similar worker protections.
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Comment removed (Score:3, Insightful)
The problem is that this _sounds_ like a good idea (Score:5, Insightful)
You can't just say "Go find an alternative" when there isn't one. It took 50 years to ship our manufacturing base overseas. You don't fix that overnight let alone without a ton of government intervention.
I keep saying this but these tariffs and trade wars are going to blow up the economy soon. Not because they raise prices, but because the economy is so fragil that consumer can't pay higher prices. Not won't, can't.
Right now companies are eating these costs. That won't last. Profits have to go up year over year. They'll do exactly what they did in 2008: Mass layoffs and mandatory unpaid overtime. If you're a tech worker reading this get ready to lose your job or get saddled with 60+ hour work weeks to make up for the 50% of your coworkers that get laid off.
It's going to make 2008 look like good times...
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"If you're a tech worker reading this get ready to lose your job or get saddled with 60+ hour work weeks to make up for the 50% of your coworkers that get laid off. " ...and this is lost on a lot of people, especially new entrants who have had 10 years of economic expansion. I'm an FTE but have lots of contractor friends who work in finance. Work dried up overnight for them the second things got bad...those that kept their contracts were forced to take multiple rate cuts. Once they're done burning through t
Re:I need to go to the hospital. (Score:4, Interesting)
Like Elizabeth Warren, a former economics professor, said: There are lots of problems with US-China trade, and we should be trading more with countries that have shared values.
The problem isn't standing up to China, or trying to get US businesses to make different choices, the problem is with a ham-handed approach that doesn't have clear, achievable policy goals, and doesn't give business any predictability. If you want business to make different decisions, you have to provide them a clear picture of future policy that will drive them to make different decisions.
The big problem for Trump is that he wants the trade war to end in a big "deal" where he gets to smile and take pictures with Xi and be the big winner and everything is good now. That goal requires not actually changing anything long-term. If he really reduced the trade deficit, there would be no deal to be had because that just means we trade less with China, so what is there for them to "agree" to? An actual improvement for the US would have to be something that we can achieve without China agreeing. Like moving a lot of that production to other countries that are willing to negotiate with the US based on labor and civil rights.
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That would be U-6 unemployment minus U-3.
If you look at 1950-1970, you'll see per-capita incomes like $3,000 in years where the minimum wage paid $2,000--the wage was 2/3 the per-capita income. In these years, minimum wage was 67%-78% GNI/C. The median household income ranged 150%-180% GNI/C, making it 2.25x to 3x the minimum wage.
If you adjust the 1960 minimum wage for inflation up to 2016, it's $7.75/hr. A full-time job paying 2/3 the per-capita income in 2016 is roughly $19.25 (today it's $20.32/h
starting with? (Score:5, Interesting)
I assume this means his companies will be the leader in this, right? Their products are made in China, and since we "don't need them" I expect within a month or 2 all of his products will be made "right here". Of course we all know there is no chance in hell of that happening since the reason they are made in China is to maximize profits, which is more important than anything, including the country, to Trump/
Re: starting with? (Score:2)
That this makes him a rancid hypocrite in no way changes the issues at hand, unless you've got metal poisoning.
What a deal-maker! (Score:3, Interesting)
The man who claimed to be the ultimate deal-maker has not only dragged us into a trade war but now he's really just declaring he can't make any deal at all. Things might not have been favorable with China but he's doing everything in his power to tank the economy by injecting uncertainty via drama.
If you voted for this man, know that you are now responsible for this self-inflicted recession.
Trade wars are easy to win (Score:2)
Stunning editing! (Score:3)
/. editors remaining top notch as always!
Mr. Trump wrote in a series of tweets [Editor's note: the link may be paywalled; alternative source].
Thank god msmash found CNBC so we can see those tweets. In any discussion about tweets, CNBC is always my first choice for reading them.
There is no alternative (Score:2, Interesting)
This is why we need Bernie Sander's Green New Deal. Everybody keeps talking about the Green part and ignoring the 20 million jobs of the "New Deal" part. Those 20 million jobs aren't sitting with your thumb up your ass.
Why? They'll just increase cost to consumers (Score:2)
And if the market can't bear the increase, they will simply close down entirely.
Because it's not like the cost of trying to move production out of China in the first place and building the domestic infrastructure would be something they could afford without at least having to increase their prices just as much.
Or does Trump think that building factories is free?
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Of course it's free. You just get China to come in and build it [forbes.com]... Oh wait...
troubling autocratic noises change nothing (Score:4, Interesting)
Has someone briefed him on the limits of power? (Score:5, Insightful)
I'm not a fan nor a hater...just constantly in shock about what's on display these days. I work in the US for a multinational with a heavy UK presence as well -- and between this and Brexit most normals we interact with are totally confused.
The only way the president has any control over the economy would be if he switched all domestic manufacturing to war production overnight like they did in World War II. I see why he's doing this because it makes him appear like a strong, autocratic CEO type to his followers. But, I'm surprised a couple of years being President hasn't opened his eyes to the fact that it's not his way or the highway. Even Obama was very idealistic in the beginning of his term and figured out that he wouldn't be able to get anywhere without making some concessions.
Someone needs to take him aside and remind him he's not dealing with some shady real estate developers or union bosses on one of his construction projects. For good or ill, the US and China have linked economies now...and Chairman Xi is in a much better position to dictate where companies direct resources than Trump is.
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I'm surprised a couple of years being President hasn't opened his eyes to the fact that it's not his way or the highway.
I almost choked on my coffee from the laughter when I read that part. Nah, friend, that's just not a thing that will ever happen.
Someone needs to take him aside and remind him he's not dealing with some shady real estate developers or union bosses on one of his construction projects.
Hate to tell you those people already left. The only people surrounding him at this point in the game are "yes men". So no one is going to inform him of that. The only thing they will do is fan his ego with how eloquent his tweets were today.
Cheers dude (Score:2)
As an environmentalist I thank Trump for this move, less goods getting shipped across the world = less pollution an more goods being produced in areas with better regulatory control over workers rights and pollution. Well that's the hope anyway, in reality most production will simply be moved to another sweatshop area with poor environmental laws.
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Often we're talking about issues like this very generally forgetting for instance that a car weighs ~8000x what a phone weighs so it doesn't matter so much where phones and little items are made, it matters more where fridges, washing machines and cars are made.
The real way to encourage people to not ship big things across the world is a carbon tax but the elite (WTO etc) wouldn't like that.
Oh goody, this is just a distraction (Score:5, Interesting)
If nothing else Trump's a great showman, but my God he's playing with the entire US economy risking a massive recession for a few cheap political points. Trump supporters, I know you're out there. Whatever he's selling you it can't be worth it, can it?
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Trump supporters are not capable to follow your chain of reasoning and are unaware of the facts you base it on. Otherwise they would not support Trump.
Trump orders history to be reversed! (Score:2)
Well, to get re-elected, he has to keep the con up for a bit longer. That he apparently does not care at all how much damage he does makes this pretty easy for him. Failed state USA...
So... (Score:3)
Does this mean Trump will start making Trump brand ties and eyeglass frames somewhere else now?
Third Country (Score:4, Interesting)
Pay a living wage. (Score:4, Insightful)
Re:Pay a living wage. (Score:5, Informative)
This off-shoring started when companies (and consumers) felt that paying a living wage for labor is not important.
Don't forget the complete lack of environmental regulations, too.
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Good (Score:3)
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Plus the president can’t really unilaterally “order” US companies to stop dealing with private companies in another country just because of a trade dispute. He’d need congressional cooperation, which isn’t as likely now that Democrats control the House.
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Is this what winning the trade war looks like? They're supposed to be very easy to win after all.
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Um ... yea they can. Look at Cuba, North Korea, ITAR regulations. The US government, including the executive branch, can and do limit which countries US companies can work with.
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And unless he had an actual constitutionally-defensible reason to do so, the closure wouldn’t happen - one of the affected companies’ lawyers would get in front of a judge and stop it before it even took effect.
One doesn’t have to look too far back to find other presidential emergency orders that’ve been blocked and have needed to be significantly rewritten before the courts would allow them to proceed.
You know you could RTFS (Score:3)
The media has softballed Trump since he announced his campaign. They love the guy. Good for ratings and they benefited from his tax cuts, deregulation and softening of overtime rules (which many
He's already talking about another round of tax cuts to stop the coming recession because the $1 trillion we just gave out did such a good job.
Remember t
Re: Watch how many misreport this (Score:2)
All of which are a lot different than "start looking for an alternative"
And all of which is propaganda, bought and paid for.
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Amusingly, he says we'd be "better off without them", because of everything we lost to them through them not buying our stuff. Buying even less of our stuff is better. Wow.
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Does it matter? Regardless of what Trump may think, he does not have that sort of power. It is upon him to find a way to make companies *want* to find an alternative to China. More to the point, most of us are just waiting for him not to be president again, so life can continue on. So not only does he have to make them *want* to find an alternative to China, he has to make us believe that whatever motivation he provides will outlast him. Maybe he should try to buy Taiwan or Hong Kong from China, or incite a
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Our great American companies are hereby ordered to immediately start looking for an alternative to China, [twitter.com]
The thing that really grinds my gears here is the word ordered! Who the fucking-fuck does he think he is to go around ordering companies to do anything? He truly does believe he is a US dictator!
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Trump has absolutely no right to tell companies who to do business with.
He did not do that. That was my point.
Re:Watch how many misreport this (Score:4, Informative)
Re:Watch how many misreport this (Score:4, Funny)
But he has also proclaimed himself to be 'the chosen one' so I suppose he is totally within his rights to order anyone to do anything?
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No it's not. Stop pretending. He might as well have said "I hereby order American businesses to have a nice day".
You think the auditors will be out checking whether businesses "start looking"? No. Of course you don't. How would you even pretend to try to measure that?
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So just because no one is checking that somehow makes the "I hereby order you to do X" not an order? That defies common sense and the meanings of the words.
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Trump has absolutely no right to tell companies who to do business with.
He has a right to say what he pleases. First amendment applies to him, just like to the rest of us.
He has no POWER to use the government's law enforcement resources to penalize those who don't do what he says.
On the other hand, a savvy buisnessman will recognize what such statements mean: He's going to do stuff with the power he DOES have that will happen to end up with those who DIDN'T take his SUGGESTION (phrased as an order he can'
Re:Wow, more shortsightedness from His Orangeness (Score:5, Informative)
> China owns the US debt
China owns about 5.5% of our debt last I checked. That's still well over a Trillion dollars, but to say China "holds the Uncle Sam's balls in their hand" is supremely fucking dumb.
Yes, it would be a problem if they stopped buying our debt. However, they might not be able to (at least, not easily) because buying our debt is how they manage all the US dollars coming into their economy. They are also not able to call in that debt arbitrarily; It's in the form of bonds, and those can only be redeemed on an agreed-upon schedule.
=Smidge=
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Re:Wow, more shortsightedness from His Orangeness (Score:4, Informative)
The leading *foreign* holder of US debt. 61% of debt is held domestically.
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And how exactly do you think the chinese came to own the US debt?
(hint: it's from the trade deficit)
But for what it's worth: at a certain level of indebtedness the roles become reversed.
Re: Wow, more shortsightedness from His Orangeness (Score:2)
No. It is because they buy US treasuries because it is a good investment and it stabilizes both economies.
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If you owe the bank $100 that's your problem. If you owe the bank $100 million, that's the bank's problem. - J. Paul Getty
When you are a huge creditor to another, then their fiscal health is MUCH more important to you, and can be a significant driver (or even the majority) of your own fiscal health. Own a few trillion dollars of US debt? Anything that causes the US economy to contract, or the value of the US dollar to sink, immediately attacks a major portion of your own wealth.
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China owns the US debt - therefore holds the Uncle Sam's balls in their hand, they supply virtually all the products Americans are used to buy for cheap... Piss them off enough and they'll ruin the country in no time flat.
You forget to mention that anything China does to either stop exporting to the US or selling US treasury bonds hurt China just as much if not more than they hurt the US. They could lose hundreds of billions if the US dollar crashes in a sell-off, and their own exports to the US would increase significantly in price. And US exports are a huge slice of their economy (around 5%), so they have little to gain from stopping exports to the US.
US Treasuries are still one of the best stable investments in the world,
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China owns the US debt - therefore holds the Uncle Sam's balls in their hand
No, China holds lots of US Treasury Bonds. That doesn't give them any power over anybody.
Try to imagine a way it gives them power. They can hold them until they mature, or they can sell them. Neither option affects the US Treasury at all, they still pay them out the same when they mature. And selling them at a loss is just a free handout to any large player who has confidence in the future of the US, which is basically everybody.
This is just a tired lie that idiots repeat because it is broad enough for smal
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If they flood the market with US Treasury Bonds, they reduce the ability of the Treasury to sell new ones.
If you manufacture pencils, and I have a vast warehouse of pencils and I start dumping them into the market, that hurts you.
They own more than a trillion dollars in treasury bonds. If the US wants to borrow more money, and tries to issue new bonds, but it's cheaper to just buy those bonds from China than to buy them from the US, the US can't borrow the money that it needs.
Yes, China would be "losing mo
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Can't anybody in the White House brief the prez before he goes out and talk reckless BS?
I fear that he _has_ been briefed on all this and more, but simply chose to regard these briefings as "fake news" and has created his own "alternate facts" instead. You know, like anybody so full of themselves that they are unable to learn.
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On losing that Republican primary that's coming up. He probably thinks that will keep him out of jail. Or that it is somehow a prerequisite for becoming the king of Greenland.
Hold the phone. Can he be the King of Greenland *and* the King of Israel [washingtonpost.com] at the same time?
(Asking for a delusional President.)
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Can he be the King of Greenland *and* the King of Israel at the same time?
The Queen of England is also the Queen of Scotland, Wales, Northern Ireland, Canada and Australia.
. . . and I'm probably missing a few others.
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It's either that or some kind of fairly normal level-headed politician who won't fight for the "economically anxious" in the stupid-ass culture wars, and that would be the greatest disaster imaginable! FLIGHT 93 ELECTION FOREEVEEEERRRR!!!1
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B. What are you going to do about it?
Impose tariffs that make you say "hmm, so what about moving my manufacturing to Malaysia, or maybe Thailand."
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All of that is a small part of the problem. Many companies in the U.S. would sincerely love for you to believe that's the entirety of the issue, but in truth, paying those workers $20/hr wouldn't make a huge difference in retail price here in the U.S.
If you want to find the bulk of the problem, look to outrageous executive compensation, rent seeking property owners, "value pricing" (and by extension, the broken markets that make it possible at all) and a whole host of related financial and economic sins.
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The US uses a lot of slave labor, too. It's true the media don't usually call it that, but that's what "prison labor" is. And the profitability of that slave labor is a reason for a lot of our laws and corrupt legal practices. The strongest union in California is the prison guards union, and you should know that couldn't happen without (unofficial) official sanction.
Re:Mr. Trump (Score:5, Insightful)
"As far as tariffs and the "trade war" go, the US is self-reliant (we have our own food, water, military, etc.) and does not need China for anything"
The one thing we no longer have is the ability to domestically manufacture anything beyond cars, airplanes and farm equipment. It would take a complete restructuring of the economy on an epic scale to bring back the manufacture of consumer goods. The MBA "outsource everything but your core competency" and "chase the lowest labor cost possible at all costs" moves have left us with an economy that can't build lower-margin items. I don't think it's possible even if companies were banned from importing goods from other countries...that infrastructure is toast now.
I get it, I'm a Rust Belt kid and would love to go back to the days of full manufacturing employment. We really do need something for all the middle-skilled people who aren't suited for knowledge work to do. Manufacturing used to be that something and I can see why Trump won in 2016. I just don't think it's possible, however good it would be. People forget how good things were when manufacturing was big...someone could go right from high school and get a well-paying job that they could keep for an entire lifetime even if they didn't have a ton of skills. That's the ideal they played on...factory workers were well-compensated and lived decent lives instead of being locked in a race to the bottom.
re: Good ::: ??? (Score:3)
How does the businesses being moved to India or Indonesia reduce the carbon footprint?