Saturday, July 07, 2018

Making America Unemployed Again

Red denotes counties to be hardest hit.  The darker the red, the greater the harm. 
The last time the United States got itself embroiled in a worldwide trade war was in 1930.  It did not end well for the American economy or for the world economy.  It's one of the lessons of history that the mental midget occupying the White House likely knows nothing about. Ditto for most of his staff and cabinet members who are little more than boot licking sycophants. The irony of the trade war Der Trumpenführer has ignited will fall disproportionately on his base.  China and other countries responding with retaliatory tariffs are targeting Trump supporting counties and states with laser precision. As the Wall Street Journal (read the entire piece) reports:
The [Chinese] retaliatory tariffs will fall especially hard—affecting more than 25% of a county’s economy—in nearly 20% of the counties that voted for Trump, affecting eight million people. Only 3% of the counties that voted for Democrat Hillary Clinton, with a total population of 1.1 million, would be so heavily hit.
The piece has an interactive map where one can check the impact on every county in the United States. In Virginia, Southwest Virginia - Trump country - will be hit the hardest. Do I have any sympathy for the victims of Trump's idiocy?  For the adults, none whatsoever.  But I do feel sadness for children and youths who be harmed by the consequences of those who answered Trump's calls to racism and bigotry. One can only hope that they will come to realize their misfortune tracks to their parents and Trump.  

Among the industries likely brutalized as a result of Trump's peevish, narcissistic desire to "win" are the auto industry and Midwest agriculture concerns.  Many farmers in Iowa who sold their souls to Trump's racist appeals may find themselves losing their farms or at minimum in dire financial straights. Again, I feel little sympathy inasmuch as the harm was self-induced.  A lengthy piece in the New York Times looks at the harm and job loses likely coming to the auto industry - plus the increased costs every American consumer will suffer - all so Trump's ego can be satiated.  May the suffering of his base be swift and extremely painful.  Here are article excerpts:
It used to be a refrain of the Republican faithful that the government shouldn’t be in the business of picking winners and losers where industry and technology are concerned.
As President Trump’s global trade war escalates, with the latest round of tariffs going into effect on Friday, his administration is doing just that. The new wrinkle is that it is no longer clear who is being set up to triumph or fail. Tariffs directed at products from one country — whether that’s steel from Canada and China or cars from Italy — are just as likely to affect American companies and hurt their workers.
The global auto industry relies on supply chains that were built on the free movement of parts and goods. Suppliers, dealers and car manufacturers in the United States and other countries are petrified by the damage that the tariffs could do to their businesses.
The Alliance of Automobile Manufacturers, a trade group for domestic and foreign automakers with operations in the United States, predicts that a 25 percent tariff on imported cars, the high end of what has been proposed, could increase the average price of a new imported vehicle by $5,800. . . . . increased vehicle costs will lead to fewer sales and less tax receipts, fewer sales will lead to fewer jobs, and those fewer jobs will significantly impact many communities and families across the country,” the alliance warned in its June 27 comments to the Commerce Department.
One of America’s Big Three automakers, Fiat Chrysler, which operates 23 plants and employs 56,000 people in the United States, is an Italian-American company incorporated in the Netherlands with headquarters in Britain. It builds its strong-selling Jeep Renegade model in Italy, China and Brazil. The company stands to lose as much as $866 million in profit, according to one estimate, if a 25 percent tariff on cars from the European Union goes into effect.
Foreign carmakers with factories in America, including BMW and Volvo in South Carolina, Mercedes and Hyundai in Alabama, Subaru in Indiana, plus Toyota and Honda, which operate plants in several states, also stand to suffer, along with all of their suppliers. A study by the Peterson Institute found that 195,000 jobs will be lost if the tariffs are enacted and 624,000 lost if retaliatory tariffs follow.
The prospect of tariff-induced job losses, however, is not just hypothetical. Harley-Davidson, the Wisconsin-based motorcycle maker, could be a bellwether.
Harley sales have been in decline in the United States for years. Its bikes are big, fat, noisy and technologically backward, and the company has been too slow to make the lighter, more modern motorcycles that appeal to younger, more technically sophisticated American buyers. Japanese and European motorcycle makers have excelled at this.
Yet, ironically, sales for Harley-Davidson have been steady in Europe, the company’s second-biggest market, while dropping 8.5 percent in the United States in 2017. Those European sales were helping to support hundreds of workers in the United States, along with assembly plants in Australia, Brazil, India and Thailand.
One of Harley’s rivals, the Iowa-based Polaris, is also considering moving some production to Poland in response to the retaliatory European levies.
Tariffs are like a long train of boxcars; each one is filled with unintended consequences that can knock into the next with devastating consequences. The names on the factories may be foreign, but the workers who stand to lose their jobs are right here in America.

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