Milton Friedman on Free Trade/Tariffs

[txradioguy]

! No longer available

[txradioguy]

From the video:

I urge on those people who think there's some sense to the steel industry argument to consider it in a more absurd setting. You very often bring out the logic of an argument by carrying it to an extreme. You know, you can have a great employment in the city of Logan, Utah, of people growing bananas in hothouses. If we had a high enough tariff on the import of bananas, it could become profitable to build hothouses and grow bananas and those hothouses. That would give employment. Would that be a sensible thing to do? If that isn't sensible, neither is it sensible to artificially restrict the import of steel.

[kevindavis007]

I prefer we listen to people like Milton Friedman not people like Pat Buchanan.

[txradioguy]

I prefer we listen to people like Milton Friedman not people like Pat Buchanan.

Same here.  A lot of what he said in the 80's in his speeches and the times Phil Donahue had him on his show is still very relevant today.

[IsailedawayfromFR]

From the video:I urge on those people who think there's some sense to the steel industry argument to consider it in a more absurd setting. You very often bring out the logic of an argument by carrying it to an extreme. You know, you can have a great employment in the city of Logan, Utah, of people growing bananas in hothouses. If we had a high enough tariff on the import of bananas, it could become profitable to build hothouses and grow bananas and those hothouses. That would give employment. Would that be a sensible thing to do? If that isn't sensible, neither is it sensible to artificially restrict the import of steel.

Except steel is a commodity which we must continue to produce in this country in order to preserve our defense capabilities when the next war comes.

We do not need bananas for our defense.

[Weird Tolkienish Figure]

Except steel is a commodity which we must continue to produce in this country in order to preserve our defense capabilities when the next war comes.

We do not need bananas for our defense.

The US probably has enough scrap steel lying around to last for centuries. Talking out of my ass here, but you get the point.

[Axeslinger]

In general, I like Friedman too...but here’s where i think his theory breaks down: he said “they will spend their dollars elsewhere until ultimately those dollars will be spent here on American goods.”  The problem here is that the trade imbalance has gotten so ridiculously out of whack that many (most?) of the companies making highly tradeable goods have gone offshore and there just aren’t that many goods in sufficient quantity made in this country anymore.

I have no problem with tariffs being used as a weapon to force some equilibrium..especially when other countries are using tariffs against us already. 

[txradioguy]

Except steel is a commodity which we must continue to produce in this country in order to preserve our defense capabilities when the next war comes.

We do not need bananas for our defense.

And if our defense industries car makers or construction companies find steel cheaper at factories not in the U.S. it’s a win for U.S. consumers and other businesses tha use the steel or products containing it.

It’s a win for everyone.

[IsailedawayfromFR]

And if our defense industries car makers or construction companies find steel cheaper at factories not in the U.S. it’s a win for U.S. consumers and other businesses tha use the steel or products containing it.

It’s a win for everyone.

So, it is in the US interest to attempt to buy steel from China if we go to war with them?

Do you believe they will sell to us?

Is that the way we won the last world war?

[dfwgator]

So, it is in the US interest to attempt to buy steel from China if we go to war with them?

Do you believe they will sell to us?

Is that the way we won the last world war?

I always point out we were friends with Japan up to the late 1920s, imagine if then we got our steel from them, and didn't build our own steel factories as a result.

[IsailedawayfromFR]

I always point out we were friends with Japan up to the late 1920s, imagine if then we got our steel from them, and didn't build our own steel factories as a result.

And that is the whole point.

Some apparently believe we can deploy mercenaries or ask foreigners to fight our wars for us.

I am for keeping our own country strong and fighting our way out independent of others.

[truth_seeker]

I prefer we listen to people like Milton Friedman not people like Pat Buchanan.

I would recommend, both.

The former can be viewed on Youtube as part of the 1970s series titled "Free to Chose", aired on PBS.

https://www.youtube.com/results?search_query=milton+friedman+free+to+choose



and

http://www.freetochoose.tv/

[txradioguy]

So, it is in the US interest to attempt to buy steel from China if we go to war with them?

There's other places than China if we need to import steel.

The Chinese need to realize this in a very blunt way...and that way is not with a meaningless tariff that hurts American's more than it will ever hurt the Chinese.

Do you believe they will sell to us?

Do you always ask questions you already know the answer to?

Is that the way we won the last world war?

The Chinese were actually on our side in the last World War and we could have avoided the Communist takeover by Mao had we not backed the Communists and stabbed Chiang Kai-shek in the back.

[txradioguy]

I always point out we were friends with Japan up to the late 1920s, imagine if then we got our steel from them, and didn't build our own steel factories as a result.

The U.S. was still a very isolationist nation in the 1920's...not near the global economic power we became as a result of WWII.

And I'd remind you we rebuilt Japan after we bombed them to ashes too.

[kevindavis007]

The U.S. was still a very isolationist nation in the 1920's...not near the global economic power we became as a result of WWII.

And I'd remind you we rebuilt Japan after we bombed them to ashes too.

Also, none of our factories was bombed during WWII..

[IsailedawayfromFR]

There's other places than China if we need to import steel.

The Chinese need to realize this in a very blunt way...and that way is not with a meaningless tariff that hurts American's more than it will ever hurt the Chinese.

Do you always ask questions you already know the answer to?

The Chinese were actually on our side in the last World War and we could have avoided the Communist takeover by Mao had we not backed the Communists and stabbed Chiang Kai-shek in the back.

Actually, I know you are a patriot - thanks once again for your service - and feel there is some real misguidance being thought through. 

I do believe it is not a strength for America to rely upon foreign entities to provide what America needs to defend itself in a war.  Your rationale to just buy it from someone who is not our enemy just does not add up as a coherent way to win a war.  What happens if those 'other places' pick the other guy to sell to?

Hoping you can buy steel from a foreign power when the shit hits the fan is not a very good strategy.  And it seems your answers have that as a solution.

Let me put it this way:  Do you believe it is ever correct for the defense of this nation to deploy tariffs?  If you say yes, then we are just talking about tactics, not tariffs.

[InHeavenThereIsNoBeer]

So, it is in the US interest to attempt to buy steel from China if we go to war with them?

Do you believe they will sell to us?

Is that the way we won the last world war?

Once upon a time, we built relatively simple planes/tanks/etc that we could roll off the line in weeks (or so, I don't know the numbers).

If we go to war today, and we don't already have the vehicle weapons we need, we're screwed, because it takes years to make modern weapons.

The next world war won't look like the last one.

[txradioguy]

Let me put it this way:  Do you believe it is ever correct for the defense of this nation to deploy tariffs?  If you say yes, then we are just talking about tactics, not tariffs.

No I do not...not in this day and age.  It makes absolutely no sense to apply a failed and ineffective tactic in the 21st century.

Found this on another thread and thought it would be useful to you.

It was written by the President's current economic advisor back in March:

But even if tariffs save every one of the 140,000 or so steel jobs in America, it puts at risk 5 million manufacturing and related jobs in industries that use steel. These producers now have to compete in hyper-competitive international markets using steel that is 20 percent above the world price and aluminum that is 7 to 10 percent above the price paid by our foreign rivals.

In other words, steel and aluminum may win in the short term, but steel and aluminum users and consumers will lose. In fact, tariff hikes are really tax hikes.

‎Some of those 5 million jobs will be put in harm's way. And if they sell less to foreigners, the trade deficit goes up, not down.

In the long run which is more important to the overall economic health of the country?

A relative handful of jobs in industries that will hike their prices right along with what the foreign tariffs on the same product will be?

Or 5 million more Americans out of work...depressing the job's participation rate that much more?

[LMAO]

I prefer we listen to people like Milton Friedman not people like Pat Buchanan.

Milton Friedman and Barry Goldwater are why I'm a conservative  today

[InHeavenThereIsNoBeer]

No I do not...not in this day and age.  It makes absolutely no sense to apply a failed and ineffective tactic in the 21st century.

Found this on another thread and thought it would be useful to you.

It was written by the President's current economic advisor back in March:

In the long run which is more important to the overall economic health of the country?

A relative handful of jobs in industries that will hike their prices right along with what the foreign tariffs on the same product will be?

Or 5 million more Americans out of work...depressing the job's participation rate that much more?

Yes, yes.

But don't forget the long and storied history of governments interfering in economies with outstanding benefits like

like

like

like the next time, because we just haven't had the right people in charge.

Or is that the Bernie platform?

[IsailedawayfromFR]

No I do not...not in this day and age.  It makes absolutely no sense to apply a failed and ineffective tactic in the 21st century.

Found this on another thread and thought it would be useful to you.

It was written by the President's current economic advisor back in March:

In the long run which is more important to the overall economic health of the country?

A relative handful of jobs in industries that will hike their prices right along with what the foreign tariffs on the same product will be?

Or 5 million more Americans out of work...depressing the job's participation rate that much more?

Well, I prefer security I guess in having the capabilities of creating our own weapons of war like ships, planes and the like rather than trying to procure them from others.

So I continue to vote for our domestic security and will accept some actions such as tariffs to prevent other countries rigging their economic schemes to bring down critical industries of this country.

[roamer_1]

The US probably has enough scrap steel lying around to last for centuries. Talking out of my ass here, but you get the point.

That really isn't as true as it used to be...
Back in the day, I could run around to all my buddies and dig in their #1 pile and find awesome steel to work with, The last car trailer I made cost me under 200 bucks in steel (less the axles, which were also cheap and used).
When steel was cheap, everyone had great #1 laying all over the place...

I recently acquired a pair of 3500 lb drop axles, and have set out to do the same thing in this day... Nobody has any #1. Nobody. I will have to buy all the steel new. And needless to say, that project has been shelved indefinitely.

[DB]

Actually, I know you are a patriot - thanks once again for your service - and feel there is some real misguidance being thought through. 

I do believe it is not a strength for America to rely upon foreign entities to provide what America needs to defend itself in a war.  Your rationale to just buy it from someone who is not our enemy just does not add up as a coherent way to win a war.  What happens if those 'other places' pick the other guy to sell to?

Hoping you can buy steel from a foreign power when the shit hits the fan is not a very good strategy.  And it seems your answers have that as a solution.

Let me put it this way:  Do you believe it is ever correct for the defense of this nation to deploy tariffs?  If you say yes, then we are just talking about tactics, not tariffs.

Do you really believe the availability of steel will determine who wins the next war?

[IsailedawayfromFR]

Do you really believe the availability of steel will determine who wins the next war?

Scarcity of resources has been a major reason why past wars were fought and won or lost.  Chief among them was access to raw materials like energy.

Yes, other than the will to fight, retaining the abilities to procure machinery will certainly enhance one's ability to win.

[kevindavis007]

Scarcity of resources has been a major reason why past wars were fought and won or lost.  Chief among them was access to raw materials like energy.

Yes, other than the will to fight, retaining the abilities to procure machinery will certainly enhance one's ability to win.

One of the main reasons why we won WWII is that none of our factories was bombed. If there is a WWIII, we are going to get hit.