Sway the Undecided

[John]

I think everyone situation is different. One thing that tariffs can do is make American companies lazy. The ship building industry had a bunch of tariffs and American shipbuilders decided to continue being stupid by using the Standard system instead of metric and now they've been decimated by global competition.

I will admit that I am not a big fan of statistics since empirical evidence can be contorted towards a certain bias. However, I do find a few numbers to blatantly show an effictive trend that tariffs cause to the American consumer. For example, James Bovard cited in the mid-90s in his book The Fair Trade Fraud that the steel tariffs of the early 90s cost the American consumer market $700K for each $50K steel worker job. MFA caused the textile industry to force a similar disparity on the American consumer market. (Disclaimer: While I don't believe these numbers are 100% accurate, I do believe there is validity to the severity of them). What this tells me is that it would be cheaper (and more beneficial) to offer educational grants to displaced manufacturing / industrial jobs. Hell, it'd be cheaper to have them sit home and watch Opray Winfrey than go to work. But unfortunately, Americans are embodied in "feel good" political mentality, so this won't happen since people resist change.

I'm not quite sure how you would structure a tariff or tax to reward companies that stay in the US but I know it'd have to be very well thought out to prevent having the opposite than intended effect. Either way US education is key in long term competitiveness.

Hopefully some of the greedy IT companies won't sell themselves and us up the creek by outsourcing their core competencies to other countries so they can come back and do battle with us in 10 to 15 years. Giving your outsourcees capital and intellectual capital is guaranteeing that they are going to cut the middle man out one of these days.

Two words: flat tax.

Throw out all the current tax code. It's 50,000+ pages of garbage is so convaluted that it creates loopholes. So many loopholes that corporations spends billions of dollars of a year to pay for efforts to search these loopholes out and exploit them. I firmly believe that the complexity of our tax code actually manifests malignant corporate governance behaviors in our country. In fact, it's not a new phenonemon, but occurs in many other countries, and especially happened following the privatization of many institutions in Eastern Europe.

Edit: Just wanted to say "good discussion (y0)!"