Protectionism, does it work?

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Milo
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Protectionism, does it work?

Post by Milo » Thu Jul 12, 2018 4:08 pm

So, after seeing headline after headline going on about how disastrous Brexit and these "trade wars" will be, I see markets up, employment up and no evidence of inflation.

Is it time to declare protectionism works?

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Doc
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Re: Protectionism, does it work?

Post by Doc » Thu Jul 12, 2018 4:15 pm

Milo wrote:
Thu Jul 12, 2018 4:08 pm
So, after seeing headline after headline going on about how disastrous Brexit and these "trade wars" will be, I see markets up, employment up and no evidence of inflation.

Is it time to declare protectionism works?
Everyone is assuming that Trump doesn't want a real trade war So what we are seeing is a negotiation, not a trade war. If it drags on long enough then it will be a trade war. I expect that point would be when domestic sources are developed in the US to replace the goods not coming from overseas.
“"I fancied myself as some kind of god....It is a sort of disease when you consider yourself some kind of god, the creator of everything, but I feel comfortable about it now since I began to live it out.” -- George Soros

neverfail
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Re: Protectionism, does it work?

Post by neverfail » Thu Jul 12, 2018 6:08 pm

Milo wrote:
Thu Jul 12, 2018 4:08 pm
So, after seeing headline after headline going on about how disastrous Brexit and these "trade wars" will be, I see markets up, employment up and no evidence of inflation.

Is it time to declare protectionism works?
Oh, it works all right Milo. We had 80 years experience with it out here and it proved very efficient in slowing this country's rate of economic growth and maintaining living standards below what they might have been had we followed a far more free market policy approach.

In 1901 we enjoyed living standards that globally were second only to those of New Zealand. By 1980 we had sunk to about 13th or 14th place. Not because ours were worse in 1980 than they had been in 1901 but because in the interim other countries with more open economies had done better.

Which is why this country ditched it during the final two decades of the 20th century.

Be warned! Tariff protection is a chimera.

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Milo
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Re: Protectionism, does it work?

Post by Milo » Thu Jul 12, 2018 6:34 pm

Doc wrote:
Thu Jul 12, 2018 4:15 pm
Milo wrote:
Thu Jul 12, 2018 4:08 pm
So, after seeing headline after headline going on about how disastrous Brexit and these "trade wars" will be, I see markets up, employment up and no evidence of inflation.

Is it time to declare protectionism works?
Everyone is assuming that Trump doesn't want a real trade war So what we are seeing is a negotiation, not a trade war. If it drags on long enough then it will be a trade war. I expect that point would be when domestic sources are developed in the US to replace the goods not coming from overseas.
So you think protectionism works?

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Milo
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Re: Protectionism, does it work?

Post by Milo » Thu Jul 12, 2018 6:38 pm

neverfail wrote:
Thu Jul 12, 2018 6:08 pm
Milo wrote:
Thu Jul 12, 2018 4:08 pm
So, after seeing headline after headline going on about how disastrous Brexit and these "trade wars" will be, I see markets up, employment up and no evidence of inflation.

Is it time to declare protectionism works?
Oh, it works all right Milo. We had 80 years experience with it out here and it proved very efficient in slowing this country's rate of economic growth and maintaining living standards below what they might have been had we followed a far more free market policy approach.

In 1901 we enjoyed living standards that globally were second only to those of New Zealand. By 1980 we had sunk to about 13th or 14th place. Not because ours were worse in 1980 than they had been in 1901 but because in the interim other countries with more open economies had done better.

Which is why this country ditched it during the final two decades of the 20th century.

Be warned! Tariff protection is a chimera.
But perhaps the main driver is an open national economy, not overseas trade?

neverfail
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Re: one and indivisible?

Post by neverfail » Fri Jul 13, 2018 3:48 am

Milo wrote:
Thu Jul 12, 2018 6:38 pm
But perhaps the main driver is an open national economy, not overseas trade?
In our case you cannot separate the two.

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Sertorio
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Re: Protectionism, does it work?

Post by Sertorio » Fri Jul 13, 2018 4:01 am

neverfail wrote:
Thu Jul 12, 2018 6:08 pm
Milo wrote:
Thu Jul 12, 2018 4:08 pm
So, after seeing headline after headline going on about how disastrous Brexit and these "trade wars" will be, I see markets up, employment up and no evidence of inflation.

Is it time to declare protectionism works?
Oh, it works all right Milo. We had 80 years experience with it out here and it proved very efficient in slowing this country's rate of economic growth and maintaining living standards below what they might have been had we followed a far more free market policy approach.

In 1901 we enjoyed living standards that globally were second only to those of New Zealand. By 1980 we had sunk to about 13th or 14th place. Not because ours were worse in 1980 than they had been in 1901 but because in the interim other countries with more open economies had done better.

Which is why this country ditched it during the final two decades of the 20th century.

Be warned! Tariff protection is a chimera.
Like most medecines, protectionism should be taken in small doses. But when you are trying to grow and diversify your economy, small doses of protectionism can do wonders. But if you take too much of it it may make you very ill indeed...

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SteveFoerster
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Re: Protectionism, does it work?

Post by SteveFoerster » Fri Jul 13, 2018 7:51 am

Milo wrote:
Thu Jul 12, 2018 4:08 pm
So, after seeing headline after headline going on about how disastrous Brexit and these "trade wars" will be, I see markets up, employment up and no evidence of inflation.

Is it time to declare protectionism works?
https://www.fool.com/investing/2018/07/ ... as-tr.aspx

Now imagine what the cumulative effect will be of all the smaller decisions along this line that don't make the news.
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neverfail
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Re: Protectionism, does it work?

Post by neverfail » Fri Jul 13, 2018 3:05 pm

Sertorio wrote:
Fri Jul 13, 2018 4:01 am

Like most medecines, protectionism should be taken in small doses. But when you are trying to grow and diversify your economy, small doses of protectionism can do wonders. But if you take too much of it it may make you very ill indeed...
Good point as long as they are selective and phased out as soon as they have served their purpose. However, a global trade war like the one that Trump has inaugurated is not designed to nurture the domestic economy but to punish perceived rivals. By its nature destructive.

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Milo
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Re: Protectionism, does it work?

Post by Milo » Fri Jul 13, 2018 3:40 pm

neverfail wrote:
Fri Jul 13, 2018 3:05 pm
Sertorio wrote:
Fri Jul 13, 2018 4:01 am

Like most medecines, protectionism should be taken in small doses. But when you are trying to grow and diversify your economy, small doses of protectionism can do wonders. But if you take too much of it it may make you very ill indeed...
Good point as long as they are selective and phased out as soon as they have served their purpose. However, a global trade war like the one that Trump has inaugurated is not designed to nurture the domestic economy but to punish perceived rivals. By its nature destructive.
Well I await proof!

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