President Obama wants US exports to double within five years. Indeed, “raising exports is a national priority.” Sounds like a Soviet Five Year Plan.
More exports are good, of course, but don’t think for a minute that Obama believes in free trade. He has created an Export Council to centrally plan his trade goal, increased tariffs on Chinese tires, doubled loans to support exports, and fought for “fair trade” at the WTO.
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The first mass execution will be in 2011. Any takers?
Yes, but not in the US. Somehow the bombs always fall elsewhere.
I meant in the US: Obama’s already performed plenty of mass executions abroad.
Nah, just severely reduced quality of life
Loaning money to foreigners to create an artificial demand for buying US goods. [Facepalm]
Good lord, what a racket.
But, unfortunately, it won’t work. Even an economic moron such as myself can figure out that raising import tariffs will lead to retributive import tariff increases on our goods by other countries. That’s no way to stimulate exports.
“raising exports is a national priority.” translation – “selling more military hardware and weapon systems abroad is a national priority”. What the hell else are we going to sell that anyone would want?
We could try politicians at a very low price.
Great idea palmer. I’m sure France will take our pseudo-communists off our hands.
hasnt this been tried before? (sigh)
i mean for an “educated” guy, he sure didnt seem to open a history book in his classes.
Oh he knows his history. He just believes that THIS time will be different, because HE is in charge.
educated?
I have never been less impressed by a so called intellectual.
Most of my friends simply sound more intelligent than he does, however none seem to me to possess his natural “used car salesman” charm and style.
If you believe what they say in public schools, you would do what Obama’s doing – so he is “educated”, alright.
As if words uttered makes things occur!
Two observations: Ego and Economic Ignorance.
Well, it’s official then. In 5 years our exports will be half of what they are at the time this plan is implemented.
i have not idea about it!
double exports? heh heh… does that mean usd depreciate by half?
someone’s on the right track
Crap:
http://en.wikipedia.org/wiki/Causes_of_the_Holodomor#Extensive_export_of_grain_and_other_food
Crap.
I wonder how they plan to implement this… pick among among the possible ideas they could implement:
1)devaluation of the dollar (after mercilessly blasting the Chinese for doing so)
2)force “allies” to buy US products at a gunpoint
3)convince Europe, Japan, South Korea etc to step military spending and buy US equipment
4)destroy some poor Third World country and then hand them billions for reconstruction on the condition that money is to be spent in the US (hey, haven’t they tried that already?)
5)slap such silly import duties on Chinese goods as to make them too expensive AND force “allies” to do the same
And that’s pretty much all I can think of.
I can add a footnote to all this export-import insanity. A couple of months ago I sold some motorcycle parts to a US customer. I walked into the post office with my package and the employee handed me a huge wand of custom papers I had to fill in six copies (yes, I had to fill the same form 6 bloody times). Luckily the office director oversaw the scene and told me if I could resize the package to slightly smaller dimension I could send it as an “express letter” which doesn’t need any custom form. So I did but I was left wondering if, after making traveling to US a nightmare the government in Washington doesn’t also want to stop trade between itself and the rest of the world. Then I remembered Bastiat (“when trade goods don’t cross borders, armies do”) and just walked away shaking my head.
The Europeans exclude exporters from a VAT — maybe Obama converts corporate taxes to a VAT, then exempts politically-connected exporters. That would appear par for the course.
This sounds like one of those programs that’s a winner politically, no matter how it comes out. If exports increase by any significant amount, Obama takes the credit and declares that, see, central planning does work. If exports don’t increase (or if they fall) Obama blames it on “market failure” and declares that, see, we need more central planning.
So in other words, it’s like everything the left has ever tried?
They can’t even use their own incorrect logic correctly. Higher tariffs on Chinese tires will make Chinese tires more expensive and increase demand for US tires here. So US tires will become more expensive both in the US and abroad. Chinese tire prices will go down so there will be less demand for US tires abroad. So ‘we’ will be importing and exporting fewer tires. So the net result will be higher tire prices in the US. Well done, Il Duce.
The Export-Import Bank
Don’t forget this favorite wholly owned government corporation, founded in 1934 to facilitate the trade of U.S. goods to importers unwilling to accept payment and credit risk. Many of those same importers seem particularly interested in buying (a) armaments, and (b) dirty energy like oil.
“Change.” Ha.
Isn’t this kind of thinking what got us into the Un-Civil War/Second War for Independence and really made the Great Depression even greater? I hate this Mercantilist thinking. The problem is that the mercantilist economies of the past had colonies and conquered places to absorb their extra output. England had the 13 Colonies, India, Australia-New Zeland and Canada for example. Now the output of the USA is so vast that it would have to have political control over 2/3rds of the world to absorb its output. So citizens of the USA must trade that output with other countries without monopoly privileges that mercantilists could shove down the throats of their colonies.
My opinion is that any imports a country has only make it wealthier as the the domestic economy can devote those resources that made the import into something that has a higher return on the labor and capital invested. The television set industry is the best example of this where very few televisions are made in the physical limits of the USA but if you open the thing up you will find lots of pieces and parts designed and maybe manufactured in the USA. The problem comes completely from government as it imposes trade restrictions and tariffs to make these foreign products more expensive thus attracting labor and capital to those industries (Think sweeteners) thus penalizing consumers twice in higher prices and the higher penalty in the products that never get created. The workers interestingly get penalized once in that they lose future opportunities.
The biggest problem with free trade is insuring all of your partners are following the same rules and many times they do not. Subsidies (agricultural for example), import tariffs, are all part of our system of government since the beginning. Those who promise ‘perks’ get elected.
I can only imagine what our world would be like if we lifted all the agricultural/energy subsidies, and import tarrifs (Ex, Ethanol, Sugar). Anyone have an idea?
I doubt that I can explain it as well as people like Hazlitt or Rothbard, but let’s think about it. I’m sure that the people benefitting from the perks would be hurt, but it’s a mistake to look just at them. For example, can you not think of some domestic producers who would benefit from being able to purchase cheaper sugar?
If a product requires a subsidy to get people to buy it, is it possible that too much of that product is being produced? Perhaps a free economy could make better use of the resources used in that wasteful production?
The whole point is that trying to manipulate economic outcomes is a fool’s game. It’s too big and too complicated. I don’t care how smart people think Obama is; it is beyond his power. I’m not saying that to hate on him. That’s just how it is.
“My opinion is that any imports a country has only make it wealthier as the the domestic economy can devote those resources that made the import into something that has a higher return on the labor and capital invested.”
That’s not merely an opinion, it’s the truth.
Statists’ anti-trade deficit campaign is ignorant and downright idiotic.
Exports are a real cost, imports are a real benefit. Obama should stop listening to the deficit terrorists and implement a real stimulus, a job guarantee: federally guaranteed employment, for anyone who wants it, at the minimum wage.
Billy,
Really? So, if Chrysler was to sell an automobile to a Mexican consumer (an export), Chrysler would not benefit? I.e. Chrysler doesn’t value the money (representing capital) paid for more than the car?
The idea that exports are a real cost is flawed. Exports represent a net gain in real terms, as the exporter ends up with more than what he had originally (according to his subjective preferences, of course). If we were to make every house a country, would you still believe that you exchanging your money for groceries (this would be an export for you, since you are exporting your money and the capital which that money represents) is a net cost?
Yes, temporary jobs for everyone, while disarming the private sector, which is the only part of the sector which can sustainably provide jobs.
A Federal Job?!?!?! at minimum wage ?!?!? what like floating in the Gulf of Mexico in a cotton dashiki and life preserver, soaking up oil?
Not like that. Look at The Job Guarantee: http://e1.newcastle.edu.au/coffee/job_guarantee/JobGuarantee.cfm
oh i see “green” jobs in Spain?
Demand for US bonds (to pay for all these “jobs” you want) is slowing, and running the printing presses to make money out of nothing will make us all poor via inflation. So, raising taxes (like the wealth tax being proposed) will only cause more rich people and job-creating companies to leave the US. In short, your plan is disastrous.
The Chinese do not lend money to the US. Bonds are bought with dollars that were exchanged for real goods. It’s just a book exchange at the fed. The government does not need to borrow to spend.
“Modern monetary theory and inflation – Part 1″ http://bilbo.economicoutlook.net/blog/?p=10554
MMT fanatic,
Of course the government is borrowing from the Chinese. Those t-bills have to be paid, with interest, at a future date. So, the U.S. Treasury is borrowing X amount of dollars today in return for X + Y, where Y is the price in dollars of accumulated interest on X.
Those dollars that were used to buy Chinese goods are owned by their Chinese holders, until they’re used to buy U.S. assets and goods.
So typical. Blinded by accounting tricks. You can print all the money you want, and play all the accounting tricks you can think of, but remember this foundational truth: something must be produced before it can be consumed.
Money from nothing is worth just that.
I got a kick out of hearing that the big “O” has vowed to double exports — in 5 years no less.
Could he be less ignorant than I think? After all, a collapsing dollar might just make it all come true.
You’d think that the White House press people would at least be intelligent enough to not say the words “five years” and “plan” in one sentence. Even to the non-conspiratorially minded out there, that just sounds spooky. They should have gone with “60 month plan” or something like that.
They probably don’t even realize it. I think it shows just how steeped in Marxism they really are.
Unless you just don’t like the idea of any government doing anything, ever, creating a plan to repair the USA’s chronic trade imbalance would seem to be a very good thing for a government to be doing. It would slow or stop the hemorrhage of money overseas, provide both jobs and profits, and be useful to business and labor alike. What’s not to like?
I’m looking over it now, and don’t see much yet about erecting trade barriers… in fact explicitly, Obama’s telling us we ought to remove trade barriers. But I guess we ought to read the fine print. Google “national export initiative” and see what’s actually in the plan. Or read this synopsis:
http://www.whitehouse.gov/sites/default/files/exports_progress_report.pdf
Aren’t we supposed to plan? If you live an unplanned life, are you better off just being surprised every day? If you want to invest in a business, do you look for one with no business plan? What makes the USA any different?
After living in Japan for 4 years and seeing Japan’s economy deteriorating more I realized how important it is for Japan and Asia to buy American goods. If they do this it keeps Americans in Jobs and then Americans can buy Japanese or Asian goods…perfect world but there is such an imbalance.
Above all the bad governmental decisions, there are ways to make good money online.
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