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TRADE WARS ON THE HORIZON

November 17, 2016

TRADE WARS ON THE HORIZON

Sarkozy of France has told French television that if Trump keeps his threat to pull out of the Paris Accord (by which we along with many other nations agreed to reduce the volume of our environmental toxins) that he would demand that the French government institute a “carbon tax” of one to three percent on all imports from the United States to France, stating that it was unfair to competing firms to require all other countries to the agreement to go to the expense of environmental cleansing while giving a free ride to the United States. He, of course, is right according to free market principles Trump claims to follow and for the perhaps better reason that as a leader of the Free World other countries might also follow our leadership and withdraw from the Accord, thus further toxifying the planet.

Here we go! The French will only be the first to penalize our export industries if Trump keeps his promise to withdraw from the Accord. Others will follow; just what we need! We already have a strong dollar that is pricing our export industry’s goods and services out of international markets; adding what amounts essentially to a tariff by countries to whom we export will make it worse and result in a surge of unemployment in our export industries which will in turn, of course, constitute yet another drag on our already tepid demand in the marketplace already beset with austerity economic policies.

When I first heard about Sarkozy’s comment to French television via a blog from a lady professor, I knew that I had to respond to it before an all-out tit-for-tat trade war broke out even among our allies such as France and other signatories to the Accord, which is threatened now due to the blundering language of our president-elect, who seems oblivious to what he says and does in the ultra-sensitive world of international trade (as with other areas of international cooperation in our global economy essential to a healthy domestic export industry in this country). Accordingly, I wrote and published the following, slightly edited from the original.

While I am for the French response to impose a tax on goods imported from the United States for Trump’s thumbing his nose at environmental treaties and protocols, I here note that the strong dollar is already causing a drag on our export industries and that this additional cost to our export industries make the drag heavier with increased unemployment in such industries here and a rise in wage inequality as labor costs will be the first to take a hit in our export industries (not profits, of course).

I also note that American-owned and/or managed industries in poor and emerging economies should take the French import tax (essentially a tariff) hit based on who owns or manages such industries so as to prevent or at least mitigate further exodus of American jobs to such venues. Trump has to be made to understand that the French and others (including us) have to live with the toxic consequences of our acts and failures to act and that all of us are trying to survive on this planet, our only home.

Breathing, for instance, is already at a premium in some parts of our planet, and undeniably caused by man-made activities. (See Chinese cities and millions walking around wearing masks where the success of state capitalism seems to be more important than the lives of Chinese citizens, apparently regarded as collateral damage by Chinese politicians.) Since such environmental acts and failures to act verge on the criminal, perhaps the French and the United States should impose an import tax on Chinese goods and services until, literally, they clean up their act. (Expect Wall Street multinationals to object as breathing and life itself or as shortened takes a back seat to profit-making from such slave wage venues.

We had better wake up before we don’t. (END).

We need a trade war like we need another hole in the head since a conflagration would certainly lead to world-wide recession, or, like in the 1930s, even worse. Words matter. Someone tell Trump.  GERALD   E

 

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