dagblog - Comments for "Finance and Society-New Economic Thinking"

Yes.

Flavius — Thu, 21 May 2015 05:05:06 +0000

In reply to Flavius - your position on

Yes.

Of course in theory it would exacerbate the reaction to what you correctly label as my extreme position on tariffs if there were any serious prospect of implementing it jointly with my equally extreme position on our nonprogressive tax code.

Clearly there's a lot of discussion right now about inequality. It concerns me too.Less because it it is creating poisonous class enmity than because we just can't afford it. Just staying with the trade and tariff issue,the billions of tax dollars we forego because the maximum incremental tax rate is 50 points lower than in 1960 renders it purely academic to consider the -worth considering- proposals for '"foreign aid through trade" because we can't afford to heal the wounds- on the working class- of the last trade agreement ...

The collective mental health- if you can say that- of the working class stems directly from getting paid for having done a days work . And there's no shortage of jobs that need to be done..And no shortage of dollars to pay them for doing those jobs.

But we don't. Because there is a shortage of politicians willing to collect those dollars and use them to put the workers to work.'

Back to inequality. If the maximum incremental tax rate were 90%-again-in theory the IRS would collect a lot more dollars.

In practice , wouldn't happen.

Corporate boards wouldn't approve compensation packages which resulted in main lining vast sums to the Government, briefly passing through various executives bank accounts.So those funds would be used otherwise: workers comp,research,price cuts. And reach the IRS that way.

And the CEO's could go back to flying to Whistler, first class instead of in a rented jet.

Flavius - your position on

HSG — Wed, 20 May 2015 22:56:00 +0000

In reply to Yes. She knows the subject .

Flavius - your position on tariffs is extreme but also I believe mostly correct. Still, there may be good reasons to have reduced or even no tariffs on certain goods imported from high wage developed countries that have a competitive advantage that we cannot overcome - e.g., French Champagne. Besides keeping the price of such products within reason, we may also negotiate for equally favorable treatment for products that we can produce better than other countries - e.g., bourbon.

Yes. She knows the subject .

Flavius — Wed, 20 May 2015 03:14:22 +0000

In reply to This was just posted 3 hours

Yes. She knows the subject . Most of us became aware of her when she had a regular column on early TPM .Thanks for this illustration of what she's currently up to.

My problem with all trade discussions is that I start from a position so extreme no serious economist shares it.: that we should start with ,say, a 100% tariff across the board on all imports from all sources i.e. a tariff equal to the US price of the equivalent product.. ( "The thing about tariffs is, they do the trick" Keynes) And then negotiate reductions as necessary to gain access to things like minerals we absolutely must import.

As an exception clearly we'd have free trade with Canada if it agreed to match our tariffs against all third countries. And I recall Friedman, in 1992 on Washington Week in Review arguing that congress would insist on whatever level of Mexican imports was required to hold down immigration.

But that's it. No tariff reductions to build Democracy in Botswana .

With a different tax system- say the one JFK inherited from Ike- the Government would have sufficient resources so we could consider such ' foreign aid via trade'. We'd have the necessary national income to somehow re employ our resulting employed.(Building better train tracks?)

But that ship has sailed. At this point however desirable the result of any particular scheme to allow increased imports, we can't afford the the cost in increased domestic unemployment .

Theoretically we could reinstall a progressive tax code and then............forget about it.Ain't gonna happen.

So if we are going to continue as ,a non-progressive tax code country ,as we are,, then a corollary is we can't afford to import anything that we could make for ourselves.(Keynes: "Let all goods be homespun").

Sure there's a "cost". On an assignment in Brazil , I asked to sharpen a pencil and was offered a jack knife. "Doesn't anyone have a proper pencil sharpener?" I asked. Silence .Then ,whispered: "there's one in the President's office." And there was . Probably 30 years old ,called the Boston Bull Dog, or something like that. After hours I sneaked in an used it., So , yeah, of course there can be costs to a no trade economy. .

Better to pay them than to continue as a country that can't employ its workers. Or keep its bridges from falling into the Mississippi.

This was just posted 3 hours

trkingmomoe — Tue, 19 May 2015 23:55:47 +0000

In reply to Sen. Warren published a paper

This was just posted 3 hours ago. She is a real power house and her staff with a full court press. Copy of the bill. http://www.warren.senate.gov/files/documents/2015-5-18_ISDS_Amendment.pdf

Sen. Warren published a paper

trkingmomoe — Tue, 19 May 2015 11:06:34 +0000

In reply to Finance and Society-New Economic Thinking

Sen. Warren published a paper yesterday "Broken Promises." It is about the US not enforcing labor standard in Trade deals. I haven't read it yet. I will post the link to it here.

http://big.assets.huffingtonpost.com/WarrenReport.pdf