Wednesday, March 9, 2016

Response to In Medias Res Again

(See: Just Above Sunset: In Medias Res Again)

This Thomas Frank guy, with his Trumpsplaining in the Guardian, sort of hits the nail on the head -- especially in knocking all those overused racism charges down to manageable size -- although, still, he leaves off too early, before answering the main question:

If Donald Trump were to win the presidency, what sort of country would he try to transform us into that would satisfy all his followers?

I myself have been, without success, looking for more accurate descriptions of the real people who back Trump, other than that they all believe, deep down in their dark souls, that America just shouldn't have a black president.

Yes, there is the occasional white supremacist who says nice things about Trump, and there are those that surround protestors at his rallies, shouting "Trump! Trump! Trump!" or "USA! USA! USA!", but when the cable networks find someone unafraid of having the words "Trump supporter" beneath their face as they sit on a panel, they are always reasonable and articulate and not at all wild-eyed spigots of unintelligible trash-talk, and when field reporters put Trump supporters on camera, they, too, seem gentle and rational and no more gun-totingly dangerous than your kindly and shy brother-in-law -- who, while he may not be packing heat, he still intends to vote for Donald Trump.

(Why? He says he just feels we need to "break things up.")

In Thomas Frank's view -- we may remember him as the author of "What's the Matter with Kansas?" (which, tellingly, was apparently published in Britain and Australia as "What's the Matter with America?") -- the answer has much to do with the fact that the message Mr. Tell-It-Like-It-Is is delivering his following is not being heard by the rest of us, that message having to do with trade -- specifically that America's elite Controllers of the Universe have sold the country out with a program of "free trade" that helps big business but hurts the American working family.

Frank is probably right, but while the fact that Trump might be talking actual substance, not trash, may surprisingly elevate him somewhat, this still shouldn't lead us to conclude that he's actually "telling it like it is", or that the Wharton School graduate, with his BS in Economics, even really knows what he's talking about. There's reason to believe he isn't, and doesn't.

For example, there is Trump's common spiel about China's currency manipulation, as found on his website:
President Obama’s Treasury Department has repeatedly refused to brand China a currency manipulator – a move that would force China to stop these unfair practices or face tough countervailing duties that level the playing field.
Maybe our surprise at Trump actually talking specifics about the economy creates a diversion that keeps us from asking whether the Wharton BS in Economics is keeping up with the latest in his chosen field, which we get in the New York Times from Paul Krugman, someone who makes a living as an actual economist:
Five years ago the Trump complaint that Chinese currency manipulation was costing U.S. jobs had some validity — in fact, serious economists were making the same point. But these days China is in big trouble, and is trying to keep the value of its currency up, not down: foreign exchange reserves are plunging in the face of huge capital flight, to the tune of a trillion dollars over the past year. 
Nor is China alone. All around the world, capital is fleeing troubled economies — including, by the way, the euro area, which these days tends to run bigger trade surpluses than China. 
And much of that flight capital is heading for the United States, pushing up the dollar and making our industries less competitive. 
It’s a real problem; U.S. economic fundamentals are fairly strong, but we risk, in effect, importing economic weakness from the rest of the world. But it’s not a problem we can address by lashing out at foreigners we falsely imagine are winning at our expense.
And it's not just about currency. There's also that question of "trade deficits", which an economic naif might think would be bad for a country, but which, as Scott Lincicome explains in late January in The Federalist, a conservative publication, might not be necessarily so:
There really is no sugarcoating it: almost everything that Donald Trump has proposed on U.S.-China trade—for example, during last Thursday night’s GOP debate, in a recent the New York Times interview, and on his website — is wrong. 
Very, very wrong. 
First, the entire premise of Trump’s plan to retaliate against China is erroneous. Trump cites the U.S.-China trade deficit as proof that the dominant Chinese, via pernicious currency manipulation, are taking weak America’s manufacturing jobs, thereby justifying his tariff plans. 
However, as I explained in The Federalist last fall, the U.S. manufacturing sector has been (until the last month or so) setting production (and export!) records, and almost 90 percent of the decline in U.S. manufacturing jobs between 2000 and 2010 was caused by productivity gains (robots and computers), rather than import competition. 
In fact, a recent Ball State study found that, “Had we kept 2000-levels of productivity and applied them to 2010-levels of production, we would have required 20.9 million manufacturing workers. Instead, we employed only 12.1 million.” So unless Trump wants to destroy all the robots, those jobs just aren’t coming back, tariff or not.
He then cites Dan Griswold of Cato, the libertarian group:
An examination of the past 30 years of U.S. economic performance offers no evidence that a rising level of imports or growing trade deficits have negatively affected the U.S. economy. 
In fact, since 1980, the U.S. economy has grown more than three times faster during periods when the trade deficit was expanding as a share of GDP compared to periods when it was contracting. Stock market appreciation, manufacturing output, and job growth were all significantly more robust during periods of expanding imports and trade deficits.
Trump has sworn he would add a 35% tariff to Ford products imported from its new plant in Mexico:
Trump said he would call Ford CEO Mark Fields — whom he identified only as “the head of Ford” — to explain the “bad news.” 
“Let me give you the bad news: every car, every truck and every part manufactured in this plant that comes across the border, we’re going to charge you a 35 percent tax — OK?,” Trump said. “They are going to take away thousands of jobs.” 
In April, Ford said it would add 3,800 jobs in Mexico as part of a $2.5 billion investment — on top of the 11,300 Ford already employs in Mexico.
He may not bring jobs back from Mexico, but for every job he destroys in Mexico, you think there just might be created a Mexican family thinking of heading north, toward us? I suppose that shouldn't be a problem if we build a high enough wall around us.

I don't know that much about free trade, but I do know the idea behind it is to help spread enough income around the world so that everybody, not just sellers but also buyers, will benefit.

And I also sense that it takes time and patience for that sort of thing to take hold. For example, Japan used to have such low labor costs that it helped attract manufacturing there, but after their wages rose enough to lift them out of poverty, the jobs went to Korea, and when Koreans started making enough to be consumers instead of just producers, there was Taiwan and Thailand and China.

Yes, we could stop that in its tracks, if we chose. All we'd have to do is refuse to buy anything from them, which theoretically would keep them having the money to buy anything from us. We could just keep ourselves safe, insulated in our "gated community" nation, behind our huge wall -- which should be okay, since who wants to do business with a bunch of Muslim rapists anyway?

All we need is a strong man to lead us, not some woosie Democrat, like Obama or Hillary or Bernie, who never went to Wharton to get their BS, so they don't know how to make great deals.

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