What does a TRUMP presidency look like?

[viper37]

He's been pretty consistent about using tariffs and deregulation to create Gilded Age levels of economic expansion and concentration of wealth. 

I am not seeing the consistency you are.  His stated reasons for applying tariffs vary depending on who he is talking to and the day of the week.

during his campaign, he talked about using tariffs to reduce income tax.

After that, his reasoning changed daily.

[viper37]

Trump fires commissioner of labor statistics after weaker-than-expected jobs figures slam markets

No the Onion.  Real headline.

[Baron von Schtinkenbutt]

[Savonarola]

Corporation for Public Broadcasting will shut down after Trump funding cuts

The Corporation for Public Broadcasting announced on Friday that it will wind down its operations due to the successful Republican effort to defund local PBS and NPR stations across the country.

The announcement came just over a week after President Donald Trump signed into law a rescissions bill clawing back congressionally approved federal funds for public media and foreign aid. Of the $9 billion in canceled funds, $1.1 billion was earmarked for the CPB.

"Despite the extraordinary efforts of millions of Americans who called, wrote, and petitioned Congress to preserve federal funding for CPB, we now face the difficult reality of closing our operations," CPB president and CEO Patricia Harrison said in a statement. "CPB remains committed to fulfilling its fiduciary responsibilities and supporting our partners through this transition with transparency and care."

Officials at the organization, which was founded more than 60 years ago, said they are focused on helping local stations figure out how to cope with sudden budget shortfalls. Harrison has warned that some stations, particularly in rural areas, will have to shut down without federal support.

Most larger stations have numerous other funding sources, including viewer and listener donations, to soften the blow dealt by Congress. Still, public media executives have warned that the interconnected system will be weakened in various ways without federal funding as a foundation.

Most of the corporation's roughly 100 staff positions will be eliminated when the money runs out on September 30. The CPB will maintain a small transition team through January to guarantee "a responsible and orderly closeout of operations," it said in a statement.

On Friday, the CPB also filed a voluntary dismissal of its lawsuit against President Trump for his attempts to remove three of five board members from the organization.

The Trump administration's cuts to the CPB were the culmination of the president's months-long effort to defund public broadcasters, which the president has alleged are "biased" against conservatives.

I'm disappointed, but not surprised.  National Public Radio will probably survive in one form or another as it's not that expensive to run a radio station; but PBS television stations, especially in smaller markets, are going to have a hard road ahead of them. 

[Zoupa]

I think it would be wise to be prepared for the possibility that tariffs would at least in part be accidental brilliancy.  I do think that a little bit of friction in trade may not be a bad thing, once you put a dollar figure on the costs of social upheaval and instability.  It would be counterproductive to set the narrative that tariffs would lead to unavoidable disaster, only for that to not pass.

I'm inclined to agree with you.  Tariffs are inefficient, but the cost-benefits we have from free trade have not been evenly shared. The gains from that efficiency mainly go to the top quintile and costs go to the bottom 50%.

Who pays for the tariffs, Raz?

[Zoupa]

But how does increasing consumer costs benefit that bottom 50%? If anything they'll be hit harder.

I think that's like asking how raising the minimum wage will benefit the poor, since they'll be paying higher prices for goods and services.  The answer may well be the same:  in the long run, they will gain more than they will lose.

Yeah, if you go from working 14/hour flipping burgers to 25/hour in a factory but have to pay 40% more for everything then you come out ahead.  There is a also the element of prestige.  The work in the lower end of the service industry is demeaning and is held in low regard.  Someone here posted a thing about online dating stats a few years ago and the job a man held that woman found the least attractive was fast food service.  It's a low status job where you must take lots of abuse from the public for very little pay.

Surveys consistently show that americans do not want manufacturing jobs. They want office work.

[Tonitrus]

They should watch more Office Space. 

Seriously though...but if we're playing the survey question game, a better question than "manufacturing vs. office?" might be "manufacturing or McDonalds?".

[Richard Hakluyt]

It's going to be great next month when the jobs figures come out. 4 million new jobs and the chocolate ration to be increased for the 5th time since Trump became president. USA! USA!

[The Minsky Moment]

If hypothetically manufacturing/GDP were to rise in the US, the effect on manufacturing employment will still be negligible because manufacturing in the US and other highly developed nations is very capital intensive. The days of plentiful high-paying jobs in manufacturing are long over because of automation.  The rise of Chinese manufacturing and opening of trade to China did little to siphon manufacturing employment, rather on a global scale it extended the period in which it remained possible for labor-intensive production methods to survive.  But now those days are mostly over; Chinese labor costs have risen, the gains from automation continue to rise, and the Chinese factories are switching to more automated processes as well.

The crazy ups and downs of the Trump tariffs obscure that a key focus since his first term has been steel and aluminum.  This is consistent with Trump's obsession with state-of-art late 19th century technology and neo-McKinleyism among his entourage.

Trump enacted steel tariffs in 2018 so we now have some history as to impact.  In summary what happened was:
1) Employment in the steel industry increased by about 3000 workers, then collapsed in the pandemic, and then recovered to roughly pre-tariff levels.
2) Prices increased, fluctuated a lot during COVID, and have settled above pre-tariff levels.
3) Total output declined.
4) Productivity levels in the industry collapsed.

We can't know for sure what would have happened absent the tariffs, but it certainly doesn't look like the tariffs did anything helpful.

More broadly, the steel industry employs about 65,000 Americans nationwide, which is virtually nothing in an economy employing 160 million people.  However, quite a lot of Americans do work in firms - including manufacturing firms - that purchase steel as an input.  Those firms have had to pay higher input prices because the tariffs.

I do think Trump has something resembling economic policy principles, they are just really simplistic and badly misguided.  He is like a Gilded Age European statesman who ranks country based on iron, coal and steel raw output, and sees tariffs as useful way to raise revenue without taxing the capital of the rich, and a competitive tool for rising in the production tables and keeping the rivals down.  None of this makes any sense in the early 21st century.

[Tonitrus]

I have a slight bias towards tariffs, but that comes from more of a national security perspective than an employment one (and definitely not the way the current administration is doing it).

I don't think we can say "let other countries manufacture that stuff" when those countries are either potential adversaries or adversary-adjacent (e.g. Japanese steel production is great and all, but does likely will be of little use in a war with China).  But for this goal, it would likely need state intervention to get the ball rolling.

On the question of being "capital intensive"...doesn't that make the critique of a tariff policy...when looking at, for example, trying to "bring steel production back to 'Merica) over a relatively short time-span (even 5-10 years) pretty shaky?

[Razgovory]

I think it would be wise to be prepared for the possibility that tariffs would at least in part be accidental brilliancy.  I do think that a little bit of friction in trade may not be a bad thing, once you put a dollar figure on the costs of social upheaval and instability.  It would be counterproductive to set the narrative that tariffs would lead to unavoidable disaster, only for that to not pass.

I'm inclined to agree with you.  Tariffs are inefficient, but the cost-benefits we have from free trade have not been evenly shared. The gains from that efficiency mainly go to the top quintile and costs go to the bottom 50%.

Who pays for the tariffs, Raz?

The importer, why do you ask?  Also who suffers the most from offshoring?

[Tonitrus]

I think another flaw in the "bring back manufacturing" argument...from both sides, is our tendency nowadays to look at things from a gig-economy perspective.

For a long time the attractiveness in a manufacturing job was the appeal of the idea of working at a place for 25-30 years, having good benefits, and retiring with a solid pension.

When you present the idea in a survey of working in a steel mill with the general employment feelings of scanty benefits, low pay/job security and no pension...it looks very unattractive indeed.

[Zoupa]

I think it would be wise to be prepared for the possibility that tariffs would at least in part be accidental brilliancy.  I do think that a little bit of friction in trade may not be a bad thing, once you put a dollar figure on the costs of social upheaval and instability.  It would be counterproductive to set the narrative that tariffs would lead to unavoidable disaster, only for that to not pass.

I'm inclined to agree with you.  Tariffs are inefficient, but the cost-benefits we have from free trade have not been evenly shared. The gains from that efficiency mainly go to the top quintile and costs go to the bottom 50%.

Who pays for the tariffs, Raz?

The importer, why do you ask?  Also who suffers the most from offshoring?

I ask because you're being obtuse.

[The Minsky Moment]

Tariffs are basically useless for national security purposes.  They don't create any industry, they don't create anything; they don't stop technology from transferring.

Tariffs are also not a substitute for an industrial policy.  They don't stop offshoring; they can't change fundamental global macro realities.

The market and pricing effect of tariffs are extremely complicated because 21st century products are fabricated using many components and sub-components, so every time a price moves, there are second, third, fourth, etc. order effects.  The Trump Brain worldview is that you tariff steel, then US steel number go up.  But that's not how things work in reality. it did not work for the Trump tariff.  And few were really surprised about that.

For very poor countries with shitty institutions, tariffs can have some use as a revenue raising mechanism, because it's easier to build a somewhat functional customs service than an internal revenue bureaucracy.

For developed countries, pretty much the only real use for tariffs is as an anti-dumping sanction, because in theory you re-equalize the price.

Other than that, tariffs are just not very useful for anything other than creating price distortions and paperwork.

[The Minsky Moment]

The bigger class-based question for US is what kind of economic future is there for people without college educations?  Clearly there are some good jobs to be had for example in the trades, but the number is limited and those do require skills and qualifications that not all have or can easily get. 

Despite the burst of anti-intellectualism in 2025 USA and the bizarre assault on a US university system that is quite literally the envy of the world, it's very unlikely that future prospects will improve for workers with less educational qualifications.  That is likely to get worse not better.  And there is no trade policy in the universe that can fix that problem.