I thought this was an excellent interview with the Commerce Secretary. There are interesting comments to this article also:
"The 4th Quarter is a perfect example. Christmas shopping was off the charts compared to the previous year. Up nearly 6%. Yet the initial GDP came in at 2.6% on January 26th. On February 28th it was revised down to 2.5%. Tomorrow will be the final revision."
"That is why 2018 will be completely dedicated to shrinking the gap between imports versus exports. That will happen through new bilateral trade deals (KORUS yesterday), tariffs (see Charles’ tweet below) and the third component, which is the most important is countries building factories and making devices in our country. Sundance shared what India plans on doing with their $500 million dollar investment in a thread last night (see below)."
"Today Jinko Solar to announce deal to build $50.5 million/407,000 square fee warehouse to build panels in America. The first Chinese company to invest in America"
"Another person shared the following graph below! We are truly on the cusp of an Energy Explosion that will rock the entire world. We currently have only 1 LNG Terminal in the USA. Look what will happen prior to 2020:"
"Folks we are absolutely WINNING! By 2019 and 2020, we will see real GDP annual rates that will blow the lid off of the naysayers."
"For over 30 years, we’ve had Forrest Gump and his clones selling out the USA economically while, like parasites, enriching themselves too stupid to realize they are killing the host. With President Trump, we now have a true genius with a brilliant economic team working to repair the damage that has sent the USA plunging towards third world status."
"Why do you start a trade war?
Cuz the other side is cheating.
Why do you stop a trade war?
When the other side quits cheating.
I swear, pundits will never understand President Trump."
I have said repeatedly that I don't much like the man (Trump), but I can appreciate his abilities. This is the first time in a long while that I sense in people optimism about the future of our economy.
Politically acceptable to talk about it back when others were in the WH
Trump is doing a great job so far considering the almost total lack of support even within his own party. It's only been 15 months. Yeah, he's a little rough around the edges but it's been nothing but polished career politicians for four administration prior who have sold out America for the enrichment of the few. Practically turned us into a third world country. He remembers what it was like as a kid and wants it back. Finally someone in our own corner. He has to expose the corruption of the 911 event and procecute those responsible It's been downhill from there in every three letter agency in America. Almost a logrithmic size leap in corruption and duplicity. Go Trump, keep setting them up and taking them down.
I did not mean for this to be about Trump. I can see where it could be now, of course. What I wanted to comment on was *if* this does work out, we could be in a very different world in a year or so. As for ag commodities, countries could *want* to import from us. And, *if* jobs do come back significantly, it would be hard to imagine what the US might look like.
All speculation at this time, however. Lots of uncertainties.
No one has to explain "why jobs would come back".. They are coming back. Not all jobs, but some.
No one can work for 2 dollars an hour in the US, and no one should have to. It's all like a balancing act.
China has a huge advantage in labor costs, but then they have to ship half way around the world. If they are making small light weight items that don't cost much to ship, they'll probably win that one.
But when they are making large heavy weight items, the labor cost advantage doesn't matter. That's why, in spite of their heavily subsidized steel industry producing a very low cost product, US imports about 2% of their steel from China. (This is before any of the latest tariff talk).
As we create a more business friendly environment, reduce regulatory costs, and engage in more fair trade practice with our partners, the balance will continue to tip in our favor and more jobs will continue to come back. Not all of them, just a lot more than we have now.
Do you have an example of when this "theory" has not worked?
I've tried twice to answer your post, Tim, and it just magically disappears. This second time I did copy the text, so I'll paste it here responding to my original post.
Yes, I think it has been a surprise to many how quickly so many companies have changed plans after seeing the tax plan and equally important Trump's drive to eliminate burdensome regulations.
Just thinking about this - there is, I think, something that is important too - confidence in the safety of money invested. Would you, if you had a large sum of money to invest, sleep better with it in the US - or - in China? What about Mexico, with a possible hard turn to the Left? I think it might be hard to overestimate the combination of this and the reality of the tax plan just passed.
As usual, focusing on only labor costs is simplistic thinking. It's nice to now have businessmen working on this. All the community organizer could do was to wave goodby to the jobs.
With any business, the final decision rests largely on cost. How much will it cost me to deliver my finished goods to my customer and how can I do it for less than my competition.
As overall costs drop in any given area (Taxes, Labor, Regulatory, Transportation, Infrastructure, etc., etc.) , business will be more likely to go or grow there. It's not rocket science. Trump knows this.
True. But more and more it is similar to the 30s when Hoover described world-wide capital flows. And, where money flows to is more and more dependent on where it feels safe. This is where the tax law was perhaps a genius move.
Oh heck yeah, without some kind of stability, the rest loses a lot.
At risk of beating a dead horse, suppose a country offers you free land to build a factory and your income will not be taxed. Cheap labor is abundant and you have easy access to ports for international shipping.
If a riot/revolution has not resulted in it's destruction, after a year, the government will likely nationalize your plant.
How quickly will you move to set up shop?
Yes, this is what I brought up - that is not being talked about. Even in this country, where do you go with cash - not where you will necessarily make the best return, but where is it safe? Many other places in the world, it is even more of a concern. I wonder how much of the money moving back (after the tax plan) is at least partly due to concerns about this.
We have lost some of our ranking for "economic liberty" in the last few years, but we are still better than most. Maybe that trend will reverse to some degree?
And I still believe in the old saying "The US Dollar is the worst currency out there, except for all the rest".
There are exceptions, of course, but overall, when you add it up, there are a lot of advantages to doing business here. And there are a few more this year than last.