Thank you, Rod. I argued this position over twenty years ago. Economic warfare is warfare. Defensive barriers can go down when a parties establish a truce. Reconstructionist friends opposed.
As I have often and long said, U.S. policy (domestic and foreign) is typically three decades behind. In the case of international trade, make that going on four decades. Perhaps now, with AI and the implosion of the Democrat/RINO party, the cycle of policy catching up to real world conditions will reduce to one or two decades.
We also have strategic products/technology that we've become dependent on frenemies to provide to us. The supply chain can be immediately disrupted causing sometimes deadly outcomes (see masks and protective equipment during Covid) that need to be produced locally to aviod these situations. This is not only a tariff issue, but a poor strategic globalist strategy that was based on a wrong thinking theory that we should leverage 'slave' labor in third world countries and avoid paying Americans to do these jobs to save a few pennies. It's refreshing to have a president that appears to want to reorient our policies to take advantage of our strengths and potential to promote bettering the lives of our citizens for a change. Time to put the cold war in the rear view mirror.
On a different note, we need to try to find ways to end our enmity with the other large powers (China and Russia) and leverage that power to encourage worldwide peace and prosperity. Always trust but verify, but look for those issues on which we can cooperate and make the world safer and more peaceful. I'm whatever you'd call an anti-Malthusian optimist, and believe we have more in common with our 'enemies' than differences. Peace.
Interesting take. But very much not a quick fix as there are some quite large obstacles that hinders a marked increase in US energy exports to the EU (outlined below)
Challenges & Inefficiencies of Importing US Energy to the EU
High Transportation Costs
LNG transport is expensive:
US liquefied natural gas (LNG) must be cooled to -162°C, shipped across the Atlantic, and re-gasified in European terminals. This adds 20-30% extra costs compared to pipeline gas. (Where Norway at present delivers 40%.)
Crude oil & refined products:
While crude oil and fuel exports from the US to the EU are common, shipping oil from the Middle East or North Africa is cheaper due to shorter distances.
Energy Losses in Transport & Conversion
LNG has a 10-25% energy loss due to cooling, transport, and re-gasification.
Shipping oil adds carbon emissions and fuel costs, making Middle Eastern and North African oil imports more efficient.
Renewable energy technologies (such as US-made solar panels or wind turbines) travel more efficiently than fossil fuels, but Europe could produce much of this itself.
Infrastructure Constraints
LNG import terminals in Europe are limited, though new ones have been built in Germany, the Netherlands, and elsewhere.
Shipping capacity for energy exports is finite, requiring long-term investments in LNG tankers and oil transport infrastructure.
On defense: the US likes to be on top with military expenses because it helps the military industrial complex and therefore the US economy. It also creates dependencies that funnel even more money into America’s pockets. Case in point the future expectations for US arms manufacturers have gone down after Trump started his stupid trade war while the European companies have seen surges. It’s not going to help the US when Europe arms up but doesn’t use US military equipment or weapons.
On dairy: The US overproduces milk which is heavily subsidized by our government. Canada does not. Therefore there is a lot of cheap (and lower quality mind you) dairy available from the US. To protect its own dairy industry there is a tariff. However, Trump negotiated a tariff free quantity that allows US milk to be imported without tariffs (last time he was around - he must have forgotten). Not even half of that quantity has even been reached for most categories in a given year. So no one is actually paying any dairy tariffs in Canada.
1. Your first statement implies strongly that the U.S. buys more weapons than it needs. Ursula von der Leyen and Volodymar Zelensky clearly disagrees with you. So does Taiwan.
2. I am not here to support the Military-Industrial Complex. I'm here to support the United States of America. If Boeing takes a hit, so be it. They'll be busy with the F-47.
3. Your dairy point just completely misses the point.
1. It doesn’t but nice try. Please refrain from distorting my point so it favors your fantasy argument.
2. I’m the last one to support the US military industrial complex. I’m quite happy about Europe waking up and starting to rely less economically and militarily on the USA. Unlike you I do see the real strain this will put on the US economy. I just don’t give a shit. That’s what you voted for so good luck with the repercussions ☺️
3. It doesn’t. Again nice try to argue without arguments. And it took you a while to reply which shows that it was hard to come up with something logical to refute my point. Which continues to stand as written.
Thanks for laying out this important information about tariffs and free trade. It makes perfect sense. It’s time our partners in trade became, “ real partners, and not haughty children living in our basement “. I loved that line. Keep telling it like it is.
It's not that you're wrong but you're ignoring the domestic side of it. Our sugar and corn lobby will never allow us to have a zero-zero with Brazil and undercut expensive American sugar and thin-tasting corn syrup, the trucking industry won't let us by ships from Korea and Japan, etc.
Is Trump going to just bull through this sort of opposition? If not, the whole thing won't work.
These are certainly difficult problems. But does Trump look like any politician you've ever seen before? If there's ever been a chance to do these things, it's now.
I can't see the future, but I think you're projecting your own beliefs onto Trump:
1) He's never shown the slightest interest in Free Trade as a principle. He's putting these tariffs up because he wants them to stay up. One of the objectives seems to be creating a revenue source outside of the income tax. However, he's going to run into the issue that a tariffs that is high enough to help domestic industry won't raise much revenue.
2) When has he really stood up to a traditional GOP economic lobby, which sugar, corn and trucking certainly are. These are his people, he's not going to throw them overboard for zero-zero treaties, which we don't know if he even wants.
Great argument. I have this general feeling that Trump is right. Your piece, and others, help with facts and sound arguments.
Brilliant analysis. Hope someone around DJT is reading your work.
We have a lot of friends in the Administration.
Thanks Rod. Proving that Donald J Trump is ahead of the game. Who knew? 🤣👍🇺🇸
Thank you, Rod. I argued this position over twenty years ago. Economic warfare is warfare. Defensive barriers can go down when a parties establish a truce. Reconstructionist friends opposed.
As I have often and long said, U.S. policy (domestic and foreign) is typically three decades behind. In the case of international trade, make that going on four decades. Perhaps now, with AI and the implosion of the Democrat/RINO party, the cycle of policy catching up to real world conditions will reduce to one or two decades.
Great analysis!
We also have strategic products/technology that we've become dependent on frenemies to provide to us. The supply chain can be immediately disrupted causing sometimes deadly outcomes (see masks and protective equipment during Covid) that need to be produced locally to aviod these situations. This is not only a tariff issue, but a poor strategic globalist strategy that was based on a wrong thinking theory that we should leverage 'slave' labor in third world countries and avoid paying Americans to do these jobs to save a few pennies. It's refreshing to have a president that appears to want to reorient our policies to take advantage of our strengths and potential to promote bettering the lives of our citizens for a change. Time to put the cold war in the rear view mirror.
On a different note, we need to try to find ways to end our enmity with the other large powers (China and Russia) and leverage that power to encourage worldwide peace and prosperity. Always trust but verify, but look for those issues on which we can cooperate and make the world safer and more peaceful. I'm whatever you'd call an anti-Malthusian optimist, and believe we have more in common with our 'enemies' than differences. Peace.
Absolutely.
Free trade via reverse psychology.
Pretty much.
Interesting take. But very much not a quick fix as there are some quite large obstacles that hinders a marked increase in US energy exports to the EU (outlined below)
Challenges & Inefficiencies of Importing US Energy to the EU
High Transportation Costs
LNG transport is expensive:
US liquefied natural gas (LNG) must be cooled to -162°C, shipped across the Atlantic, and re-gasified in European terminals. This adds 20-30% extra costs compared to pipeline gas. (Where Norway at present delivers 40%.)
Crude oil & refined products:
While crude oil and fuel exports from the US to the EU are common, shipping oil from the Middle East or North Africa is cheaper due to shorter distances.
Energy Losses in Transport & Conversion
LNG has a 10-25% energy loss due to cooling, transport, and re-gasification.
Shipping oil adds carbon emissions and fuel costs, making Middle Eastern and North African oil imports more efficient.
Renewable energy technologies (such as US-made solar panels or wind turbines) travel more efficiently than fossil fuels, but Europe could produce much of this itself.
Infrastructure Constraints
LNG import terminals in Europe are limited, though new ones have been built in Germany, the Netherlands, and elsewhere.
Shipping capacity for energy exports is finite, requiring long-term investments in LNG tankers and oil transport infrastructure.
No real fix is quick.
The world order as it currently exists didn't happen instantly with a stroke of a pen at Breton Woods, and it won't change overnight either.
That's no reason not to change.
Such a bad take. Examples:
On defense: the US likes to be on top with military expenses because it helps the military industrial complex and therefore the US economy. It also creates dependencies that funnel even more money into America’s pockets. Case in point the future expectations for US arms manufacturers have gone down after Trump started his stupid trade war while the European companies have seen surges. It’s not going to help the US when Europe arms up but doesn’t use US military equipment or weapons.
On dairy: The US overproduces milk which is heavily subsidized by our government. Canada does not. Therefore there is a lot of cheap (and lower quality mind you) dairy available from the US. To protect its own dairy industry there is a tariff. However, Trump negotiated a tariff free quantity that allows US milk to be imported without tariffs (last time he was around - he must have forgotten). Not even half of that quantity has even been reached for most categories in a given year. So no one is actually paying any dairy tariffs in Canada.
1. Your first statement implies strongly that the U.S. buys more weapons than it needs. Ursula von der Leyen and Volodymar Zelensky clearly disagrees with you. So does Taiwan.
2. I am not here to support the Military-Industrial Complex. I'm here to support the United States of America. If Boeing takes a hit, so be it. They'll be busy with the F-47.
3. Your dairy point just completely misses the point.
1. It doesn’t but nice try. Please refrain from distorting my point so it favors your fantasy argument.
2. I’m the last one to support the US military industrial complex. I’m quite happy about Europe waking up and starting to rely less economically and militarily on the USA. Unlike you I do see the real strain this will put on the US economy. I just don’t give a shit. That’s what you voted for so good luck with the repercussions ☺️
3. It doesn’t. Again nice try to argue without arguments. And it took you a while to reply which shows that it was hard to come up with something logical to refute my point. Which continues to stand as written.
Excellent!!! Best insight I’ve seen! Thanks.
Thanks for laying out this important information about tariffs and free trade. It makes perfect sense. It’s time our partners in trade became, “ real partners, and not haughty children living in our basement “. I loved that line. Keep telling it like it is.
It's not that you're wrong but you're ignoring the domestic side of it. Our sugar and corn lobby will never allow us to have a zero-zero with Brazil and undercut expensive American sugar and thin-tasting corn syrup, the trucking industry won't let us by ships from Korea and Japan, etc.
Is Trump going to just bull through this sort of opposition? If not, the whole thing won't work.
These are certainly difficult problems. But does Trump look like any politician you've ever seen before? If there's ever been a chance to do these things, it's now.
I can't see the future, but I think you're projecting your own beliefs onto Trump:
1) He's never shown the slightest interest in Free Trade as a principle. He's putting these tariffs up because he wants them to stay up. One of the objectives seems to be creating a revenue source outside of the income tax. However, he's going to run into the issue that a tariffs that is high enough to help domestic industry won't raise much revenue.
2) When has he really stood up to a traditional GOP economic lobby, which sugar, corn and trucking certainly are. These are his people, he's not going to throw them overboard for zero-zero treaties, which we don't know if he even wants.