Reduce the trade deficit; increase GDP, jobs and median wage

Re: Reduce the trade deficit; increase GDP, jobs and median

Postby Supposn » Thu Apr 28, 2016 2:28 am

Saz wrote:
Supposn wrote:Saz, how did you read and consider Wikipedia’s “Import Certificates” article?


I did not because it's apparent YOU wrote the wikipedia article. So it's not an actual source, but your opinion. And if it's your opinion, you are free to post it here and have it debated but I'm not going to click fake wikipedia pages to amuse you.

It has to be based on something. A certificate to import what? 1 item of any good? 1 dollar of any good? I assume it's a dollar amount, as an import cetificate for items would be even easier to abuse.

Nation’s median wage rates are generally improved when their currency is stronger and the IC proposal would not reduce the U.S. dollar’s value, but the proposal works to their nation’s favor regardless of their currency’s global exchange rate.
Currency devalueation is one of the best way to boost exports, because it makes your product cheaper abroad. A strong currency actually harm exporters, because it makes it cheaper to buy important. So I don't see what your import certificate will accomplish, other than encouraging firms to artificially boost their levels of export (by exporting gold or the like) in order to increase the amount that can be imported. This will not lead to a trade balance, all it will do it choke off the supply of imports and encourage firms to export items they have no comparative advantage in making.

It's not an issue with commodities, it's an issue with the imports certificate mechanism itself. The problem is that when you limit imports in such a manner, you will effectively bar certain good from coming into the US. Because you don't segment the import certificates by industry or product, certain industries or products will be able to effectivley outbid and then use all the available import certificates. Let me put it this way, if GM needs to import a critical car component, and a small business that fixed cars also needs to import the same part...who will have the advantage when it comes to buying import certificates? The large business. It works even worse across industries. What happens when Exxon, Walmart and Mcdonalds use all the import certificates to import oil, food, clothes? Well there are no import certificates left for more mundane, but equally critical imports.

Essentially, you are capping the amount of imports we can bring into the country. But you pout no other restrictions on this cap, ensuring that large producers like Walmart, or large industries like oil/gas, monopolize the import certificate market and effectively "use up" all of the import certificates. You would end up with a market where a few large producers in a few key industries are the only ones who can afford to import anything, the rest of us have to make due in a market where some can access the global supply chain, and others can't.

/////////////////////////////////////////
Excerpted from Wikipedia’s “Import Certificates” article: "Many who are aware of the ”Balanced Trade Restoration Act of 2006” text find it has faults that could have been easily corrected:
They regret that assessments would not be adjusted to exclude the value of specifically listed scarce or precious minerals integral to the goods being assessed. We should discourage the export of cast gold paper weights encrusted with gems in order to facilitate importing high-tech or labor intensive goods. This fault could severely undermine the bill’s economic benefit to our nation.
Natural gas and oil should have also been included in such a scarce or precious minerals list. The proposal itself should not favor the export or inhibit the import of such scarce minerals. (The original U.S. Senate draft temporarily (for only 5 years) excluded the entire value of goods containing petroleum)”.
//////////////
yes, the issue is that it's not just oil and gas that are scare. In a free market, a central planner cannot and does not know what will be scarce tomorrow. It would be aluminum pipes, or lithium, or competent accounting services. But by creating an import certificate, and capping the amount of imports, SOMETHING will be made scare. There will be products we need/want, that are best imported, which we cannot import because of this absurd policy.


Saz, apparently you have not yet read the description of the proposed Import Certificate policy even after I posted a transcript of it upon the forum or you have no interest or comments or questions regarding the concept.

I did not fully respond to your post because much of it was not germane to Import Certificates. I believe your comments and questions would be different if you had read the concept’s description.

Regarding your last paragraph, the Import Certificate regulations do not themselves deem anything as being illegal to import into the USA.
The approximate values of specified listed mineral materials are reduced from the gross assessed value of the shipped goods; (e.g. the adjusted value of globally traded gasoline is reduced by the value of the petroleum that's integral to the gas;
[b](gasoline) - (crude oil) = the adjusted assessed value of gasoline.

The list of rare or scarce or precious minerals is determined by the U.S. Congress and is, (as most federal laws and regulations are) subject to changes by the U.S. Congress. A list of scarce minerals wouldn't be expected to change very often over the decades.

The Import Certificate regulations would not prevent or encourage USA's importing or exporting of gasoline. Carbon pollution, and conserving our own petroleum deposits are separate political issues not to be determined by Import Certificate regulations.

An import certificate's face value is the assessed value of the exported shipment of goods that initiated the certificate's issuance. The certificate does not specify the destination of the exported goods or the type of goods. Similarly Importers of goods surrender transferable Import Certificates with face values covering the value of their goods they’re importing into the USA.

Respectfully, Supposn
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Re: Reduce the trade deficit; increase GDP, jobs and median

Postby spacemonkey » Thu Apr 28, 2016 11:37 am

Many people are just stupid and will continue to pay hundreds of dollars for tennis shoes and other crap made by child slave labor.
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Re: Reduce the trade deficit; increase GDP, jobs and median

Postby Josh » Fri Apr 29, 2016 8:27 am

spacemonkey wrote:Many people are just stupid and will continue to pay hundreds of dollars for tennis shoes and other crap made by child slave labor.


go read: Open World for facts that counter this generalization
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Re: Reduce the trade deficit; increase GDP, jobs and median

Postby IndependentProfessor » Fri Apr 29, 2016 9:33 am

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Re: Reduce the trade deficit; increase GDP, jobs and median

Postby Josh » Fri Apr 29, 2016 9:40 am

Supposn wrote:
Saz wrote:
Supposn wrote:Saz, how did you read and consider Wikipedia’s “Import Certificates” article?


I did not because it's apparent YOU wrote the wikipedia article. So it's not an actual source, but your opinion. And if it's your opinion, you are free to post it here and have it debated but I'm not going to click fake wikipedia pages to amuse you.

It has to be based on something. A certificate to import what? 1 item of any good? 1 dollar of any good? I assume it's a dollar amount, as an import cetificate for items would be even easier to abuse.

Nation’s median wage rates are generally improved when their currency is stronger and the IC proposal would not reduce the U.S. dollar’s value, but the proposal works to their nation’s favor regardless of their currency’s global exchange rate.
Currency devalueation is one of the best way to boost exports, because it makes your product cheaper abroad. A strong currency actually harm exporters, because it makes it cheaper to buy important. So I don't see what your import certificate will accomplish, other than encouraging firms to artificially boost their levels of export (by exporting gold or the like) in order to increase the amount that can be imported. This will not lead to a trade balance, all it will do it choke off the supply of imports and encourage firms to export items they have no comparative advantage in making.

It's not an issue with commodities, it's an issue with the imports certificate mechanism itself. The problem is that when you limit imports in such a manner, you will effectively bar certain good from coming into the US. Because you don't segment the import certificates by industry or product, certain industries or products will be able to effectivley outbid and then use all the available import certificates. Let me put it this way, if GM needs to import a critical car component, and a small business that fixed cars also needs to import the same part...who will have the advantage when it comes to buying import certificates? The large business. It works even worse across industries. What happens when Exxon, Walmart and Mcdonalds use all the import certificates to import oil, food, clothes? Well there are no import certificates left for more mundane, but equally critical imports.

Essentially, you are capping the amount of imports we can bring into the country. But you pout no other restrictions on this cap, ensuring that large producers like Walmart, or large industries like oil/gas, monopolize the import certificate market and effectively "use up" all of the import certificates. You would end up with a market where a few large producers in a few key industries are the only ones who can afford to import anything, the rest of us have to make due in a market where some can access the global supply chain, and others can't.

/////////////////////////////////////////
Excerpted from Wikipedia’s “Import Certificates” article: "Many who are aware of the ”Balanced Trade Restoration Act of 2006” text find it has faults that could have been easily corrected:
They regret that assessments would not be adjusted to exclude the value of specifically listed scarce or precious minerals integral to the goods being assessed. We should discourage the export of cast gold paper weights encrusted with gems in order to facilitate importing high-tech or labor intensive goods. This fault could severely undermine the bill’s economic benefit to our nation.
Natural gas and oil should have also been included in such a scarce or precious minerals list. The proposal itself should not favor the export or inhibit the import of such scarce minerals. (The original U.S. Senate draft temporarily (for only 5 years) excluded the entire value of goods containing petroleum)”.
//////////////
yes, the issue is that it's not just oil and gas that are scare. In a free market, a central planner cannot and does not know what will be scarce tomorrow. It would be aluminum pipes, or lithium, or competent accounting services. But by creating an import certificate, and capping the amount of imports, SOMETHING will be made scare. There will be products we need/want, that are best imported, which we cannot import because of this absurd policy.


Saz, apparently you have not yet read the description of the proposed Import Certificate policy even after I posted a transcript of it upon the forum or you have no interest or comments or questions regarding the concept.

I did not fully respond to your post because much of it was not germane to Import Certificates. I believe your comments and questions would be different if you had read the concept’s description.

Regarding your last paragraph, the Import Certificate regulations do not themselves deem anything as being illegal to import into the USA.
The approximate values of specified listed mineral materials are reduced from the gross assessed value of the shipped goods; (e.g. the adjusted value of globally traded gasoline is reduced by the value of the petroleum that's integral to the gas;
[b](gasoline) - (crude oil) = the adjusted assessed value of gasoline.

The list of rare or scarce or precious minerals is determined by the U.S. Congress and is, (as most federal laws and regulations are) subject to changes by the U.S. Congress. A list of scarce minerals wouldn't be expected to change very often over the decades.

The Import Certificate regulations would not prevent or encourage USA's importing or exporting of gasoline. Carbon pollution, and conserving our own petroleum deposits are separate political issues not to be determined by Import Certificate regulations.

An import certificate's face value is the assessed value of the exported shipment of goods that initiated the certificate's issuance. The certificate does not specify the destination of the exported goods or the type of goods. Similarly Importers of goods surrender transferable Import Certificates with face values covering the value of their goods they’re importing into the USA.

Respectfully, Supposn


The sheer effort involved in evaluating the economy's need for raw material and differentiating which goods get the regulation based on political purposes speaks volumes to how unrealistic an IC policy would be in a market.

Please listen to the following podcast:

Neo-Mercantilist Hysteria

If you're looking for good free material to read on how trade really works (including the involvement of trade with centrally planned economies, protectionist policies, and open trade):

Protection or Free Trade

and here is book that covers the same ground, but I have misgivings about some of the essays particularly the outdated ones about import deficits effect on the English central bank gold-based currency - but we're talking about taking us back to a policy that comes from that era of protectionist trade and archaic central banking policies:

Austrian Theory on Trade Cycle and Other Essays

Enjoy those. Just a quick take-away that is a good rule of thumb when considering protectionist policies:

We ineffectively use sanctions and tariffs punitively against countries for political purposes and it hurts their general population and start trade wars which usually just lead to violent conflicts (from world war to terror). This IC policy is way too close to the opening salvos of a trade war against the entire globe as a broad-based tariff.
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Re: Reduce the trade deficit; increase GDP, jobs and median

Postby Supposn » Fri Apr 29, 2016 6:36 pm

John Galt, this may (or may not) be of interest to you.
Respectfully, Supposn
//////////////////////////
Transcript of a post within another group.
http://www.city-data.com/forum/politics ... emedy.html

Quote:
Originally Posted by whogo
Source, for that pure BS?
Excerpted from:
http://www.infoplease.com/cig/economics ... -good.html
International Finance: Trade Deficits: Bad or Good?

” But what about the effect on GDP? Shouldn't Americans worry when net
exports are negative and GDP is smaller than it otherwise would be?

Most mainstream economists believe that because the current account deficit is offset by foreign investment in the United States, the [trade deficit’s] effect on GDP is negligible”.
/////////////////////////////////////////////////////////////////////////////////////////

WhoGo, it’s inconsequential if the sources for investments into the USA are from USA or foreign sources. When USA’s economy is up, we attract commercial investment, when the economies down we attract less commercial investment into the USA.
The volume of investments into USA is not dependent upon our trade balance.
I question that trade deficit’s effect upon GDP is “negligible” but that’s for discussion in another post.

Those contending that trade deficits are not detrimental to their nation’s jobs and wage-rates point out that unemployment rates have risen when trade deficits were decreasing and unemployment rates decreased when trade deficits were increasing.
Surprise! Unemployment increases when sales volumes of general goods in USA market places are down. Unemployment decreases when USA market places sales are generally increasing.
They got the correct statistical facts but arrived at an illogical conclusion.

Regardless of the economies condition, (if the GDP is rising, falling, or just languishes), trade deficits are ALWAYS drag upon their nation’s jobs, wage-rates and production.

Respectfully, Supposn
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Re: Reduce the trade deficit; increase GDP, jobs and median

Postby Supposn » Sat Apr 30, 2016 6:37 am

I have begun a new thread “The Import Certificate Proposal” in defense of an Import Certificate proposal,
viewtopic.php?f=48&t=5642

Within this thread will attempt to respond to any posts specifically addressing the Import Certificate concept as now described in those referred web sites.

Refer to
viewtopic.php?f=48&t=5637
or to
https://en.wikipedia.org/wiki/Import_certificates

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Re: Reduce the trade deficit; increase GDP, jobs and median

Postby Supposn » Sat Apr 30, 2016 9:00 am

Josh wrote: ... We ineffectively use sanctions and tariffs punitively against countries for political purposes and it hurts their general population and start trade wars which usually just lead to violent conflicts (from world war to terror). This IC policy is way too close to the opening salvos of a trade war against the entire globe as a broad-based tariff.


Josh, I have begun a new thread “The Import Certificate Proposal” in defense of an Import Certificate proposal,
viewtopic.php?f=48&t=5642
We've been discussing two topics within this thread. I'm defending my statement that Trade deficits are ALWAYS a detriment to their nation's numbers of jobs, wage-rates and production. I'm also defending a specific Import Certificate proposal.
I'm taking the liberty to shift your comment and my response to the new thread.

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Re: Reduce the trade deficit; increase GDP, jobs and median

Postby Supposn » Sat Apr 30, 2016 9:17 am

Josh wrote:
Saz wrote:I did not [read "Import Certificates"] because it's apparent YOU wrote the wikipedia article. So it's not an actual source, but your opinion. And if it's your opinion, you are free to post it here and have it debated but I'm not going to click fake wikipedia pages to amuse you.


The sheer effort involved in evaluating the economy's need for raw material and differentiating which goods get the regulation based on political purposes speaks volumes to how unrealistic an IC policy would be in a market.

Please listen to the following podcast:

Neo-Mercantilist Hysteria

If you're looking for good free material to read on how trade really works (including the involvement of trade with centrally planned economies, protectionist policies, and open trade):

Protection or Free Trade

and here is book that covers the same ground, but I have misgivings about some of the essays particularly the outdated ones about import deficits effect on the English central bank gold-based currency - but we're talking about taking us back to a policy that comes from that era of protectionist trade and archaic central banking policies:

Austrian Theory on Trade Cycle and Other Essays

Enjoy those. Just a quick take-away that is a good rule of thumb when considering protectionist policies ...


Josh, my local library has borrowed books on my behalf from libraries beyond our county. I have already requested “The Failure of Agrarian Capitalism”.
If I can obtain the book, I hope I can find the references to the Import Certificates. I don’t suppose we’re discussing a document that’s used as Warren Buffett described; but I’m speculating and there’s no possibility of my KNOWING if I haven’t read the specific passages in the book.

I’ll try to look into the books you suggested but I’m not able to wade through entire books seeking the nuggets you suggest. I hope those books contain indexes.

Regarding your comment within your post, if you tell me on what basis you believe they apply to the SPECIFIC version of the Import Certificate proposal, I’ll be pleased to respond. I prefer responding within new thread "The Import Certificate Proposal". I’m not trying to evade any points of discussion but I don’t want our corresponding to suffer the same faith as I’m experiencing with Saz.

Saz refrains from reading the Import Certificate proposal but he doesn’t believe that’s any reason not to criticize it. I don’t mind discussing what may be a misunderstanding or an error of logic between us but I haven’t the time to respond to comments that are based upon what he speculates is the Import Certificate proposal’s concept.

Respectfully, Supposn
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Re: Reduce the trade deficit; increase GDP, jobs and median

Postby spacemonkey » Mon May 02, 2016 11:33 am

Josh wrote:
spacemonkey wrote:Many people are just stupid and will continue to pay hundreds of dollars for tennis shoes and other crap made by child slave labor.


go read: Open World for facts that counter this generalization

Some also gloat over how many thousands they pay for a ticket to some big game. That shit is real.
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