Tag: Donald James Trump

Many Politicians Are Two-Faced When It Comes To Tariffs

Many Politicians Are Two-Faced When It Comes To Tariffs

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As I write this, POTUS Donald Trump is pledging to begin tariffs on Mexico for its accused lack of assistance in the immigration crisis on the southern border of the US. Here is a quick news account from Politico:

The White House pledged on Thursday to charge ahead on tariffs on Mexico, saying the U.S. position “has not changed” after officials met for a second day to address the steady flow of Central American migrants trying to enter the United States.

Talks between Mexican and U.S. officials at the White House wrapped up without resolution. Several key officials in the administration were unavailable for negotiations. President Donald Trump was in France for the 75th anniversary of the D-Day invasion, and both Vice President Mike Pence and Secretary of State Mike Pompeo were on the road.

Just about every politician is talking out of both sides of their mouth on this issue. This includes a good portion of the Republicans (especially Mr. Trump) and nearly ever Democrat that I can think of.

To be crystal clear, I despise the use of tariffs against another country. I don’t like taxes in general and using taxes as weapon (i.e. tariffs) is simply a bad practice.

Tariffs are taxes. Plain and simple. They are taxes on corporations that import from the punished country, which in this case is Mexico.

The problem with tariffs and corporate taxes is that corporations never pay taxes. They incur costs. They pass those taxes as costs on to their customers in the form of higher prices for the product. They think of taxes as the same as wages, costs of materials, rent on their buildings, etc. It is a separate line item on their financial sheet, but it is deducted from their income the same way when calculating earnings.

It isn’t the corporation that pays the taxes, it is the consumer. Worse, the tax is regressive in that it is applied to all consumers of the product regardless of their ability to afford to pay or their income. Nearly everyone agrees that regressive taxes that take a larger percentage of poor people’s income than the percentage of wealthy people is unfair. But corporate taxes and tariffs are exactly that – a regressive tax on poor people.

Trump and most Republicans want lower corporate taxes. This, in general, is a good thing because as I said above, corporations don’t pay taxes – they only incur costs that are passed to their consumers. Corporate taxes are an evil and regressive tax against consumers.

So it is illegitimate for Trump and these anti-corporate tax Republicans to support the tariff on Mexico (and probably on China, but China is a different problem).

Democrat readers shouldn’t get too excited about the above paragraph, as they are actually worse.

Most of the leaders of the Democrat party are in favor of raising corporate taxes. This is a terrible stance since, as I stated above, corporate taxes are simply a regressive tax against the poor. The Democrats are supposed to be the party of the poor worker and yet they support regressively taxing those people. That is incredibly evil and insincere. They only do it because it plays well in political speeches. Democrats don’t really want to help poor people, they just want to be re-elected (which is also the goal of Republicans). They are willing to be for a tax that hurts their constituents rather than be truthful and lead those constituents. This is unbelievably cruel and ruthless.

But then Democrats become even more two-faced. Because they hate Trump so much they oppose the Mexican tariff. This is ridiculous if they were ideologically pure since tariffs (while very bad IMO) are simply what most Democrats espouse – higher corporate taxes.

So what does all of that mean?

Unfortunately, it is simple. Both parties are mostly evil and don’t want to help Americans. They are willing to lie and mislead their constituents simply to retain their individual jobs. The only valid option as voters is to THROW THE BUMS OUT! EVERY LAST SITTING FEDERAL POLITICIAN NEEDS TO LOSE THEIR JOB IN THEIR NEXT ELECTION!

High Interest Rates Are Hobbling Growth – WSJ

High Interest Rates Are Hobbling Growth – WSJ

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The problem with growth in the US economy will be immediately be solved the day that we stop the trade war with China. We don’t need the Fed to counter-balance a political battle between China and the US. Mark my words, when this trade war is over, the economy will almost immediately overheat.

Also, you can guarantee that POTUS will turn off the trade war by the first quarter of 2020 so that the economy is running at top speed for the November election. The Chinese know this and they know they just have to hold on 6 more months and our political will for the trade war will vanish.

Source: High Interest Rates Are Hobbling Growth – WSJ

There’s an increasingly strong case that the Federal Reserve should cut interest rates to weaken the U.S. dollar and encourage greater exports—and that it should do it soon.

A strong dollar makes it cheaper for Americans to purchase foreign goods and more expensive for those using a foreign currency to purchase American goods. The dollar has strengthened relative to foreign currencies since the second quarter of 2018, and U.S. exports have essentially stagnated. While the U.S. economy surged in 2018 thanks to tax cuts, deregulation and a declining oil price, gross domestic product could have grown faster. Preliminary GDP growth over the past three quarters has been a strong 2.9%, but had real exports grown at a 3% annualized rate—which they did from 2009 to 2018—GDP would have grown by 3.2%.

The Fed’s tightening of the money supply contributed to this decline in export growth by making the U.S. dollar more valuable. The Fed has increased the federal-funds rate nine times since beginning the rate increases at the end of 2015, which boosted the demand for greenbacks. The greater the federal-funds rate, the greater the return on investments made in dollars. The Fed also ended its expansive monetary policy as the economy improved, constraining the money supply and further enhancing the dollar’s value.
Democrats want lower corporate taxes just not under Trump

Democrats want lower corporate taxes just not under Trump

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Don’t let the current partisan bickering on corporate taxes make it seem like both sides of the aisle don’t want this. It is good for America and everyone that understands economics understands this. The issue is that when the Democrats held power, they couldn’t effectively do this because their liberal wing (i.e. the people that do not understand economics) would crucify them in the election booth.

Suddenly, an idea that has been accepted by economists and by policymakers on both sides of the political aisle—that high taxes on business hurt investment, workers, and the economy—is considered “absurd.”

In 2012, President Obama and his advisers proposed lowering the corporate tax rate because it “creates good jobs with good wages for the middle-class folks who work at those businesses.” In 2013, Lawrence Summers, President Clinton’s Treasury secretary and chairman of Mr. Obama’s Economic Council, argued that the tax on corporate profits creates a burden without commensurate revenues for the government and that changing it “is as close to a free lunch as tax reformers will ever get.”

In 2015, Democrat Chuck Schumer and Republican Rob Portman co-sponsored a Senate bill to reduce the top corporate tax rate, which is the highest of any of the 35 countries in the Organization for Economic Cooperation and Development. “Our international tax system,” Mr. Schumer argued back then, “creates incentives to send jobs and stash profits overseas, rather than creating jobs and economic growth here in the United States.” Bill Clinton in 2016 said he regretted raising the corporate rate to its current level.

Yet President Trump’s Council of Economic Advisers is now being accused of partisanship and unscientific analysis.

This is politics for the sake of politics. Not for making America stronger or helping our citizens.

Source: A Turnabout on Corporate Taxes

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