Tariff Threats as a Tool

[Ernie]

There is a lot of chatter going on in the political world as to whether tariff threats are a good tool or not to get people to bargain and deal. We might as well discuss that here as well.

[Ernie]

I personally don't think that threats are a good way to deal with neighbors or friends in any situation. It never results in better bonding or better trust or better understanding in the end. I think it always results in more harm than good in relationships. Now whether this can be fully mapped on to relationships between countries, I'm not sure, but it would seem that some of the same principles would be at play.

[barnhart]

Historically, they have been more destructive than constructive. According to my knowledge.

For example I have read the argument that tariffs and embargos were a large factor pushing Japan (and then US) into WW2 by clarifying that developing nations must have colonial control to ensure access to raw materials.

Narrowly targeted tariffs are likely less damaging, the US has long protected heavy truck industry through tariff, or maybe that is an outright import ban.

[R7ehr]

The Bostonians weren’t to cheery about paying a tariff on tea either at the end of 1773

[Ken]

There is a lot of chatter going on in the political world as to whether tariff threats are a good tool or not to get people to bargain and deal. We might as well discuss that here as well.

We can look at the two real world examples of Mexico and Canada this week.

After all the sound and fury coming out of the Trump Administration it turns out that both of the "deals" agreed to by Mexico and Canada in the past two days were the same deals that they had already agreed to during the Biden Administration. In other words, nothing new.

The most generous conclusion we can draw from all this is that this is all just performative on Trump's part. The less generous observation is that he doesn't, in fact, know what he is doing.

[Robert]

After all the sound and fury coming out of the Trump Administration it turns out that both of the "deals" agreed to by Mexico and Canada in the past two days were the same deals that they had already agreed to during the Biden Administration.

Countries can agree, then do nothing. Seems they are being held accountable. I see that as a good thing.

Trump talked about that in yesterdays press conference. He said tariffs are a very good bargaining tool since everyone wants to trade with the US. He said if the US was not so in demand, they would not be a very good tool to use.

I don't see why everyone is so worked up about it. Almost every country has tariffs on some things. Adjusting and using them to better trade with other countries is a smart and practical thing to do.

[Ken]

After all the sound and fury coming out of the Trump Administration it turns out that both of the "deals" agreed to by Mexico and Canada in the past two days were the same deals that they had already agreed to during the Biden Administration.

Countries can agree, then do nothing. Seems they are being held accountable. I see that as a good thing.

Trump talked about that in yesterdays press conference. He said tariffs are a very good bargaining tool since everyone wants to trade with the US. He said if the US was not so in demand, they would not be a very good tool to use.

I don't see why everyone is so worked up about it. Almost every country has tariffs on some things. Adjusting and using them to better trade with other countries is a smart and practical thing to do.

So you are saying that Trump is the boy who cried wolf? Or that no one should pay attention because he is all bark and no bite?

I mean that's a take. But I'm not sure it is how we want our government to behave. The tariffs he was threatening to impose would have had severe economic consequences for many Americans. People aren't supposed to pay attention?

[Robert]

So you are saying that Trump is the boy who cried wolf? Or that no one should pay attention because he is all bark and no bite?

I said neither.

I said a country can promise anything, but do nothing. Accountability is key to trade deals. How was that statement construed to anything you posted?

[Bootstrap]

There is a lot of chatter going on in the political world as to whether tariff threats are a good tool or not to get people to bargain and deal. We might as well discuss that here as well.

We can look at the two real world examples of Mexico and Canada this week.

After all the sound and fury coming out of the Trump Administration it turns out that both of the "deals" agreed to by Mexico and Canada in the past two days were the same deals that they had already agreed to during the Biden Administration. In other words, nothing new.

The most generous conclusion we can draw from all this is that this is all just performative on Trump's part. The less generous observation is that he doesn't, in fact, know what he is doing.

It lets Trump claim a great victory, even if they simply agreed to what they had already agreed to under Biden. Reality TV. It's effective.

My sense is that Mexico really could go a long way to improve what they are doing on Fentanyl and human trafficking. But I think Canada has been doing what they can for a long time. I doubt that there will be much substantive change with Canada unless someone can figure out what they should be doing beyond what they are already doing now.

Regardless, using tariffs for this kind of goal is a new thing. And it does feel like bullying. That can affect our allies, who seem to be making a lot of trade agreements without us now. They don't trust us to lead. And that costs us influence - which makes China and Russia happy.

[ken_sylvania]

Regardless, using tariffs for this kind of goal is a new thing. And it does feel like bullying. That can affect our allies, who seem to be making a lot of trade agreements without us now. They don't trust us to lead. And that costs us influence - which makes China and Russia happy.

Has the rate at which allies of the USA are signing trade agreements without the USA changed significantly since Trump's inauguration?