American Politics Discussion Thread

[Mjmd]

Its a good thing a strong dollar and it being the world reserve currency doesn't give us any advantages. We should definitely tank that.

There are advantages. The advantages are primarily aimed as US consumers. Foreign imported goods are cheaper. Foreign vacations are cheaper. That's all nice and dandy for consumers.

The USA also has producers. Capital owners who export, and people dependent on working such jobs. Since we live in a democracy, those people can vote to kick consumers in the nuts to benefit producers. Is that the best way to govern a country? Probably not, and Winston Churchill can burn in hell for all I care. But it is what we're stuck with for now.

Producers get cheaper imported inputs as well; it isn't just consumers. There are also geopolitical advantages. But the biggest one is we get comparatively cheap government debt. It doesn't seem wise to tank the dollar until that issue is solved.

[Zed-F]

Once again, all I am seeing here in response to the biggest self-inflicted financial and geopolitical wound in the last century of US history is some ideological culture war nonsense. You can’t make any cogent defense of the results of your vote, so time to deflect, huh?

Reshoring is a long process, and tariffs are a very logical component of reshoring. China has a lot of tariffs and localisation requirements, and the result has been successful. 

I don't have a strong opinion as to whether Trump's tariffs will succeed (and I hope they fail because I am a patriotic Australian and my country is occupied and infiltrated by the US). But why are you so sure they will fail? 

I am not very interested in your Russian State TV view of geopolitics as it's obviously biased (and just plain wrong) on many levels. However, there are several reasons the Trump tariffs can't work.

1. They don't have a clear and consistent objective or a policy that is clearly aimed at said objective; there are several theories as to how these tariffs might be used, but these theories work against one another, and it's clear that while there may at one point have been a plan, Trump has gone badly off-script, as he is wont to do. The tariffs are not based on any economic policy or viable objective; they are based entirely on Trunp's misunderstanding of economics, grievance, and vibes. They can't succeed because they are self-inconsistent and not targeted in any meaningful sense.

2. As said before, trade relies on trust and stability. Trump himself is famously mercurial, inconsistent, and easily manipulated. If nobody can trust that Trump's tariff policies are consistently pointed at a sensible and communicable objective, nobody can effectively plan for the future years down the road, which is what is required for businesses to adapt to them. If the tariffs aren't consistently pointed at a sensible goal and thus can't be successfully adapted to, they don't work.

3. Internally to the US, this will be fought against. Pressure on Republicans to end this nonsense will ramp up over the next weeks and months as Republican voters feel the pain. It looks increasingly likely that trade between China and the USA will break down entirely, with disastrous consequences for both nations, but China is a hugely important market for US farmers, who will suffer heavily. Most Republicans voted for Trump under the theory that his administration would improve the economy, not destroy it. While the midterms are likely to be a bloodbath in favour of the Democrats on the basis of this performance, I don't think these policies will last even that far. At some point, Congress will be forced to take back their tariff powers. Never forget that Trump's goals often don't align with the political motivations of the members of his own party -- about which Trump doesn't really care.

4. Internationally, as mentioned, the governments of historical US allies will not stand for extortion by the Trump administration; their own voters will not stand for it. If these tariffs are not swiftly removed or reduced to minimal levels in such a way as those international governments can credibly claim success to their voters, they will adopt collective action to exclude the US from the global alliance structure as an unreliable actor.

[greenline]

Do you think Democrats are going to win an election with a free trade agenda? I haven't yet considered this possibility.

They could do this. But if they could do this, they wouldn't be Democrats.

Bloomberg tried to run on this platform in 2020. He was castigated for his stop and frisk policies, which were effective at reduce crime and making the city streets safer.

If you believe in free trade and abundance to the point where you do stuff like that, then progressive liberal nannies and superdelegates don't vote for you in the primary. There's no doubt that the neoliberal merchant tycoons have a big say in the party. But the buck does not stop with them. The buck stops with the party men and women and creatures. Hillary got to run in 2016 because It Was Her Turn. In 2020, It Was Biden's Turn. In 2024, It Was Kamala's Turn. Strong bet that whoever's Turn it will be in 2028, it will not be someone friendly to the Abundance agenda.

[greenline]

Producers get cheaper imported inputs as well; it isn't just consumers. There are also geopolitical advantages. But the biggest one is we get comparatively cheap government debt. It doesn't seem wise to tank the dollar until that issue is solved.

Trump thus far has not found a creative loophole for the executive branch alone to resolve the debt issue. The president has historically had the power to not spend money, but even if Trump decided that he's going to fix the debt problem by not sending out any more entitlement checks, then whoever his successor is might just stop doing that. There would be a lot of pressure to stop.

Why not compromise with Congress to fix the debt problem? Because Congress sucks and doesn't want to fix it. People think Trump is sinking because his approval rate is dropping below 50%. Guess what approval rate Congress has? And most of the senior guys there are practically elected for life. Lol. The Republican margin is thin and I don't think Trump can corral them into making tough choices on spending. We'll see until the midterms, I guess.

I thought using tariffs to potentially force a crash, or a market reevaluation, or deflation, might do something that would force Congress to address the debt issue. But the market is a big, tough beast. Even a repeat of Smoot Harley tariffs, it eats for breakfast. Line must go up, it says. Buy the dip. So that ain't happenin'

[Zed-F]

Those buying the dip right now are the ones betting Trump will reverse course, ‘Art of the Deal’, declare victory and not go through with it. Markets will drop again tomorrow if he does in fact go through with it. But the rubber hits the road (driving into oncoming traffic) when this starts to show on Main Street, not Wall Street.

[darrelljs]

They could do this. But if they could do this, they wouldn't be Democrats.

Republicans becoming !Republicans seems to have worked out pretty okay.

Darrell

[greenline]

Those buying the dip right now are the ones betting Trump will reverse course, ‘Art of the Deal’, declare victory and not go through with it. Markets will drop again tomorrow if he does in fact go through with it. But the rubber hits the road (driving into oncoming traffic) when this starts to show on Main Street, not Wall Street.

He's already gone through with it, to the point that foreign exporters are already adjusting their prices. The time for him to back out was a few weeks ago when he was just floating the idea around. But here we are and the tariffs are now reality. Wall St ultimately isn't affected very much. Now, regular people will be pissed if their car payments get 20% more expensive and they get nothing in return, but there isn't much they can do besides waiting for the next election cycle.

Republicans becoming !Republicans seems to have worked out pretty okay.
Darrell

It worked for the Republicans because they had way less institutional kruft in the way of a populist candidate just appealing directly to voters. No superdelegates, for one thing. Way less institutional money to buy out potential challengers. Only one big network to boo candidates instead of several working in concert. Very little support from government workers and defense contractors in a tiny slice of Delaware. The modern GOP is far more insecure about its existence than the Democrats, and insecure parties lack institutional control. So I don't see the Democrats reversing course easily.

[Zed-F]

Now, regular people will be pissed if their car payments get 20% more expensive and they get nothing in return, but there isn't much they can do besides waiting for the next election cycle.

They can and will lobby their Republican Senators and Congressmen, as will business people and the wealthy Republican elites that didn't think this is what they were signing up for. Pressure will build on them to do something, and there is only so much of that they'll be able to take before they pull Trump's tariff authority. Especially when special elections continue to show them the cost of not doing *something*.

[greenline]

Welp.

Technically, that was not missing the whale. That was shooting the whale dead center, and the whale shrugging it off, flicking its tail, and continuing to chase down some divers unabated.

But if you're trying to revolutionize the country and the economy, you at a bare minimum have to have faith in your own plan. If you don't have that, what do you have? Not much at all.

I guess we've yet to see who the American Yeltsin is. Time to sit on the porch, crack out a nice beer, and start to feel really glum about the future.

[T-hawk]

Yup. I knew Trump was smart enough to not let that go on. I put my money on it, literally, had a few paychecks worth of uninvested cash and bought the dip and caught the bottom just about perfectly on Monday and so up handsomely today.