TARIFFS AND TRADE

David Stockman was President Ronald Reagan's Secretary of the Treasury, and the youngest cabinet member to ever serve in the federal government.  He's still hard at it, crunching numbers and guesting routinely on Doug Casey's blog.  Full disclosure:  that's the only blog I read almost religiously.

                  The one posted this week examines whether our trade deficits are due to tariff cheating, or lopsided tariffs, as President Trump claims, or something else.  It's a slog to get through; lots of charts and lots of number comparisons.  Would it surprise you if the analysis reveals American trade deficits have nothing to do with tariffs?

                  Here is the bottom line takeaway for me:  China's wage for workers versus the U.S. wage for workers averages a $34 per hour pay gap.  Think about that for a moment.  It costs $34 more dollars to pay someone to do something in the U.S. than that same job in China.  That's comparing dollars to dollars (yen converted to dollars).  

                  Here is the other bottom line factor:  U.S. welfare payments (transfer payments) amount to $12,000 per capita per year; in China, it's $1,200.  In other words, when you take the federal transfer payment budget and spread it out over the entire U.S. population, it's $12,000 per person. Yes, you read that right.  Those dastardly Chinese communists expect their people to work and don't dish out freebies to freeloaders.  Fancy that.

                  He examines several blocks, from the EU to Asia to Mexico and Canada and debunks the whole myth that our trade deficits are due to other countries cheating on tariffs.  No, it's that the U.S. doesn't require anyone to work.  This is moral bankruptcy on a cultural scale.

                  Whenever I hear people say we need those immigrants to do things Americans won't do, like gut chickens and pick green beans, my first reaction is "quit paying people not to work and see who's willing to do the dirty jobs."  The only reason Americans have lost their work ethic is because we've enabled people to go on the dole.  It's easier than working.

                  This is not a trade problem.  It's not a technology problem or resource problem. It's moral debauchery.  You simply cannot have a functioning society when millions of people spend their time playing rather than working.  

                  The best thing Trump could do for our economy would be to eliminate ALL welfare tomorrow; bang, cut it off.  Yes, ALL of it.  Churches and philanthropic organizations would step up to help the truly needy but it would be voluntary relief rather than compulsory relief.  You cannot offer charity originating in violent compulsion (taxes). 

                  The problems we as a culture face are not primarily due to other people taking advantage of us; we have dug our own grave with overspending creating inflationary pressure on wages and making it easy to escape productive work.  These are rot and moral decay in a culture, but we'd rather point fingers and blame someone else, play the victim, than look inward to our own missteps.

                  To be sure, we can't and shouldn't police the world.  We can't afford it empirically or morally. I can't work hard enough to protect Germany with U.S. military bases or fund layzies who would rather shoot up fentanyl than engage in productive work.

                  The one thing we could do to cure food/farm issues is a FOOD EMANCIPATION PROCLAMATION--cure oligarchy with freedom.  The one thing we could do to cure our cultural and financial depravity (and yes, spending more than you take in is financial depravity) is to eliminate ALL government transfer payments.  When Jesus said to help the poor, the admonition was not to the government; it was to individual charity.  Neighbors helping neighbors.

                  Would you help someone if the government didn't?