The facts are pretty clear. In August 15, 1971, Nixon imposed a 10% tariff on goods. It had the desired results.
By December 15, 1971, Nixon dropped it because the Dollar had fallen 6% relative to Germany/Japan.
Germany had told Nixon its decision not to revalue the Mark was final.
Guess what it did after Nixon slapped the tariff on?
It revalued the Mark.
There is an academic paper from MIT people are talking about right now though.
It was published March, 2011.
http://econ-www.mit.edu/files/6613 and has created
quite a buzz.
It undermines the conventional wisdom of free-traders such as yourself.
The most startling finding of the survey is that transfer payments to jobless,
reduced incomes of families, reduced revenues of local government in total,
actually cost more than any economic benefit Americans receive from cheap, subsidized Chinese goods.
That's revolutionary.
It supports my argument that America's economy faces the greatest face it has ever confronted.
The threat comes from a predatory Mercantilist nation with a 1.4 billion population.
*****
Now in order:
You must be studying liberal revisionist history rather than the real thing. If you recall, we tried a 25% tariff on Japanese automobiles during the '70's too, ostensibly to protect all those union jobs in Detroit.......we know how well that worked out, don't we??
I can find no reference to a 25% tariff on Japanese automobiles in the 1970's. Please provide a cite.
I don't think it happened. Are you confusing a tariff with a quota?
The only time tariffs work is if we catch a country "dumping" their products on our markets for less than it costs to manufacture them, to force a larger market share.
Here, you've stated a conclusion about when tariffs work and when they don't. Basically you've made an unsupported statement.
What leads you to believe
the only time tariffs work are in dumping situation? What specific incidents support your statement? You don't cite any.
On my side, a tariff worked fine in 1971. It had the desired effect on the respective currencies.
You don't know much about Chinese history either, I see........90% of the population are peasants,
That 90% number is not correct. I don't know where you got that. Please give a source.
The numbers I can cite are 800-900 million 'peasants' out of 1.3 + billion people.
That's around 70% not 90%. But I think the number is higher than reported. I'd put it at 900 million or
1 billion out of the total. Even so, that's far below 90%.
and even if they are working in a PLA factory making cheap toys, clothes, or electronics for a nickle an hour, they can still go back to surviving in the rice paddies like they have for 4,000 years. Industrialization in China is brand new by their cultural and historical standards........they don't have an addiction to a "life style" like we Americans do
I think you're wrong about that. China can barely feed itself and it can't fuel itself. I think in the event of a new great depression, there would eventually be starvation in China. And that would lead to government instability.
What the hell rock did you crawl out from under economically?!? The Dollar has been sinking like a stone for nearly four years.......do you even watch the market??
I agree with Trump on tariffs. America became a huge world power when US goods sold cheaply on world markets.
QE 1 & 2 ring a bell?? I've been making a killing shorting the Dollar (and the Euro) for over two years......haven't had a margin call yet, nor do I expect one in the near future. China maintains tight control on the value of their currency rather than let it float with the market.........if China can be accused of anything it is artificially devaluing their OWN currency......if China allowed their currency to react to market forces, their goods would be far more expensive than they are.......you aren't going to correct that situation with a tariff.
Congratulations on that. I hope you can continue to short the Dollar. The cheaper US goods are on the world market,
the more Americans can go to work manufacturing them & selling them.
Rebuilding from what exactly?? Did they have a mass war or catastrophe that I missed??
Read the MIT Report I cited (above).
I guess that pretty much solidifies my opinion of your opinion........as well as your depth of knowledge about economic history.
Trump may be really good at reality TV, building upscale apartment buildings in Manhattan, or casinos in Atlantic City......running a country........I cringe at the thought.......
doc
