Increase Tariffs, More Savings or Hollow Out Industrial Base

[West Dundee Hawkeye]

The US has 3 choices on trade.

1. Increase tariffs to protect US manufacturing and accept higher prices

2. Increase savings by ending borrowing (read: end budget deficits) by raising taxes & cutting spending since Savings-Investment=Exports-Imports

3. Let the industrial base hollow out

What do you prefer?

 

[West Dundee Hawkeye]

I am an old school Ike Republican and like Ike, Truman and Bill Clinton who each balanced the budget 3 times, I prefer increasing savings by raising taxes & cutting spending to balance the budget.

Increasing savings means people have less money and so therefore spend less and prices go down. This then lowers long term interest rates and then the dollar drops in value. This results in lower priced widgets and a lower priced currency that they are priced in. As a result, exports go up.

The tax rate under Truman and Ike was over 90% and the country boomed from 1946-1960.

 

[hawkeyetraveler]

My .02

We need to significantly reduce government spending while increasing revenue. I am an advocate to take the extra revenue needed from the dead vs. taxing those that are productive. But I’m on an island on that. Republicans don’t want increased taxes of any kind (which is asinine…we are going bankrupt we need revenue) and Dems don’t want to eliminate programs (which is asinine - even if the programs do good things it will all be for naught if we default).

In terms of manufacturing, I am 100% against tariffs, they hamper free trade and are a regressive tax on lower income folks. Instead, while I recognize this is incongruous with cutting spending, I would continue to provide government support in the form of extremely low interest loans for companies reshoring critical manufacturing capabilities (Pharma, chips, etc).

As a result I voted for the middle choice which most closely represents my views.