Armstrong Economics Blog/World Trade
Re-Posted Jul 2, 2018 by Martin Armstrong
QUESTION: What is your “opinion” on the Trump tariffs dispute with China?
ANSWER: Years ago, an old friend from high school was in the Philadelphia Steam Fitters Union. They went on strike for a very long time. He finally came to me and asked for a job. I gave him one and all I ever heard was how if he stayed 15 minutes longer, he would be paid double time. I sent him to New York and everyone always came back by the end of the day besides him. When I asked what happened, he said it was 3 o’clock and there was no point to come back to the office for just a couple of hours. This was the 70s. He drove a Toyota. When I asked why he was driving a foreign car he said it was cheap and reliable. I asked what about the union jobs he was bypassing. He did not answer. Needless to say, I had to fire him.
It’s always comical to me how people always want the cheapest price they can buy, and then they want the highest possible wages to work. I believe in free trade. Tariffs are only forcing consumer subsidized high wages. If someone can produce the same product at a better price, that is the benefit of the consumer. Those people should move on and retrain to an industry that is higher paid rather than demanding excessive wages for jobs other can do for a lot less.
The United States really has a trade surplus of about $1.4 trillion when trade is allocated to the flag a company flies. The USA is moving more into the high-tech areas. Lawyers are a dying profession and medical is slowing by overpricing itself and there too we will see real price shocks. Let the free markets decide the future. That is what they are good at