The one thing that surprised me is your statement that the Trump tariffs are costing you hundreds of thousands of dollars. How do you get that estimate? It seems like an overestimate by at least an order of magnitude.
I didn't sell. The tariffs definitely cost me hundreds of thousands initially. But it's unclear why the market recovered. Maybe it would be another 10% higher but for Liberation Dah.
If it's clear to you that the tariffs on April 2 definitely cost you hundreds of thousands initially, why is not equally clear that when Trump backed off from the April 2 extreme, you recovered at least a substantial amount of that loss?
I hope that it won’t compete with the attention Unbeatable will get with that release timing!
1. Will it cover war (or peace) sanctions? The common example of South Africa as an example of trade restrictions working?
2. I don’t remember if Open Borders or BBB covered objections to using GDP as a measure of economic growth and well-being. This is commonly heard with “We’re a nation, not an economy” slogans.
3. I know you’ll address the decline of manufacturing jobs, but Google Gemini recently brought up an argument that the decline in manufacturing jobs might have caused African American single parenthood rates to climb. I had never heard that before and think that you would have interesting thoughts on that considering your interest in the success sequence.
Good idea! At the EXTREME end, though not first imposed by Trump, is a full trade blockade. Take Cuba, for example. The US blockades en. Not Canada, though. Hence hwhy I was able to visit Varadero and Havana. How does Cuba feel about the Americans' blockade? Well, they have propaganda Billboards along the side of the highway instead of advertising BillBoards. (Cause they're a Communist country. Of course they do!) One Billboard that stood out to me, said: "Bloqueo: El Genocido mas largo de la historia". Maybe a BIT of an exaggeration. But maaaaaaan, they HATE it!
But not only that, you can talk about how developing countries' own tariffs hurt them and restrain their growth. For example, in the Philippines, flight attendants smuggle groceries from Singapore, there is a black market of onions, coke had to start cutting its regular Coke with aspartame, etc.
It's hard to tell hwhat exactly you're gonna cover from those chapter titles, sir! And hard to know hwhat you consider "non-obvious" but here's a list of topics that I'm hoping you'll touch on:
- Infant Industry argument
- How trade makes both sides better off, including the side with a trade deficit and third-world countries that only have a comparative (not absolute) advantage
- Non-economic arguments against free trade. Like: "We must protect our steel industry so we can still make weapons if our enemies are blockading us." Or "we must protect our food industry so our enemies can't starve us out."
- Environmental arguments for trade restrictions. For example, let's say Canada requires paper mills to install scrubbers so they don't make their town smell like shit. Let's say Mexico does not. Obviously, Canadian paper is gonna cost more than Mexican paper. Can we charge a tariff on Mexican paper to even the playing field a bit, here?
- Dumping and anti-dumping policies and the absurdity thereof. My old International Econ professor was really into this topic!
- Logistical complications of Free Trade agreements. For example, the EU has Free Trade across EU member states. (Yay!) But if any member state wants free trade with a non-EU country, ALL EU member states have to agree. (Boo!)
- Retaliatory tarrifs and trade wars
- Why hasn't Mexico's GDP caught up with the US yet, despite NAFTA?
- Take a global perspective. Not just the US. How have US tariffs harmed other nations. How have other nations only stupid tariffs harmed them?
- Arguments that free trade hurts exporting nations (for example, drives up prices of Quinoa in Bolivia)
- Arguments that subsidized products harm importing nations. For example, the US subsidizes agriculture, this leads to US food being cheaper than local African food in Africa. hWhich is, apparently, bad for African farmers.
- Concerns about "exploiting" poor people in the Third World
- Concerns about people in the Third World exploiting us!
- "Currency manipulation" (hwhatever that is!)
- KEYHOLE SOLUTIONS!!!
- Abuse of loopholes in trade agreements. Like Trump declaring an "emergency" and using that as an excuse to impose tariffs on Canada and Mexico.
- Maybe something about how many trade agreements leave out certain key industries. Like a trade agreement that allowed Free Trade on everything EXCEPT oil and natural gas, might sound good at first, but would actually be kind of a shitty deal for Qatar. And they might be better served by allowing a 10% tariff on everything.
Sorry I'm commenting a lot. Some people find that annoying, apparently. I have a lot of ideas. And I hope I'm contribution to the conversation. Dr Caplan, I'd love to see a chapter on keyhole solutions, like you did with Open Borders. It seemed that was missing in BBB. It seems there's no room to compromise with NIMBYs? Except, of course, HOAs which are quasi-government, imo, but I digress. But there's room to compromise with anti-immigration folks, apparently. I think there's plenty of room to compromise on trade!
For example, most Canadian exports to the US are duty-free thanks to CUSMA (which is basically just NAFTA 1.1) But many metals (like steel, aluminum, copper) are subject to a 50% tarrifs. If I was negotiating, perhaps I would prefer a comprehensive tarrif, like 10% on everything, instead of 50% on some things, 0% on others. If they were to throw in full labour mobility with Canada (but not Mexico - come on! Trump is NEVER gonna do that!), then I think this is a much better deal than we have now!
We should be willing to compromise a bit on FREE trade in exchange for more COMPREHENSIVE trade.
So, unlike most Canadians always bitching aboot Trump's tariffs, I actually think Trump's "trade war" with Canada is an opportunity to try to negotiate a better deal. But I doubt Carnie would be able to pull it off!
I'm also kinda curious: How did the left and the right switch sides on trade? I seem to recall back in the early 2000s, leftists were rioting at WTO Conferences, etc. So much so that on 9/11, I thought maybe there was a left-wing terrorist group responsible for the attack on the World Trade Center, before we found out that it was Al-Queda.
But now, it's the right that is very anti-trade. Is it just Trump? Or is it more than that?
One example of a leftist anti-trade argument: Free trade disrupts the local culture of the exporting nation. For example, quinoa. Bolivians love quinoa. So do American health-nuts. Increased demand for Quinoa from American health-nuts is driving up the global price for quinoa so much so that it's out of reach for many poor Bolivians.
There's also the notion that domestic labor, safety, environmental, and other laws should apply to all imports. I think of all such laws, both domestically and as applied to trade, as leftist, even though they have some measure of "bipartisan" support.
Oh, interesting anecdote: hWhat initially planted the seed of Open-Immigration in my head (It's not you, Dr Caplan! 😛): I remember conversing with this leftist guy who had spent like 4 months on a volunteer trip in central America. I was about 15/16 at the time. Knowing that leftists tended to be anti-free-trade, I tried to gently troll him by telling him about my staunch support of free trade. He said he didn't support free trade unless it was accompanied by "free immigration". Something, something about third world workers trapped and being exploited. But, I honestly hadn't thot aboot it before. And I really couldn't think of any objections, so I said: "Sure, hwhy not?"
I later learned in an International Econ course that, even in the absence of "free immigration", free trade benefits both sides more than it harms, including the third-world-workers who produce goods that are exported to rich countries.
But still, open immigration AND free trade is the BEST!
I look forward to reading it! Might I suggest including the "race to the bottom" in labor & environmental standards, Taiwan and South Korea's protectionism, antidumping & foreign subsidies, and trade ethics, e.g., cotton from Xinjiang?
Another thing: hWhat about tariffs as political pressure? Like say if they are abusing their own people or invading another country, the free world imposes trade sanctions on them. Yes, it's painful for the country imposing the sanctions, too. But less painful than war. hWhat do you think of that?
No country has renounced tariffs. All countries, even those ranking high in economic freedom indices, retain tariffs and impose them at their own discretion.
And all countries have legions of economists to advise them. So, apparently economists themselves are divided. Recently Walter Block at EconLog make a pertinent observation:
"Some 500 economists work for the Federal Reserve System. This is probably more than the entire dismal science faculty at all eight Ivy League Universities, perhaps with Chicago and Berkeley thrown in for good measure. If the Fed were disbanded, they would all have to seek other work, perhaps leading to prosperity. Under the present institutional arrangements, they undermine the economy. On the other hand, this is an empirical issue. Presumably, many of them would obtain faculty positions, on the basis of which they would be inculcating their charges with the same voodoo economics with which they ruin the economy.
Why? How so? That is because one of their present roles is to determine, among other things, the interest rate. Thus, this job of theirs is “beneath contempt.” "
Here's an argument I constructed inspired by Bastiat's scenario of a ship exporting goods sinking before it reaches its destination to illustrate the balance-of trade fallacy: Some goods and services—such as roads, buildings, and police protection--must be produced domestically because they're impossible to import. For an American protectionist, the worst possible situation would be one in which everything possible to import would be imported into the U.S. from all other nations in the world, who would “dump” all they produce on the U.S. market that they can export and accept no money, goods, or anything else in return. In that case, the U.S. would experience the maximum possible “trade deficit,” and all other nations of the world would have the largest possible “trade surplus.” As a consequence of this international welfare, most Americans could virtually stop working and enjoy much leisure time while the rest of the world starved. Unfortunately for us, this situation couldn't continue for long. At least, the world would learn a valuable lesson about trade that would be hard to forget. Feel free to use this argument. I expect you can improve on it. I require no credit.
I live in an area with a lot of preppers, and they frequently express fears that if we become dependent on strategic “rivals” for goods that would be critical in a military conflict (saline, oil, etc) then we’re kneecapping ourselves as a world power. I’d love to see an analysis of how overstated (or not) these fears are.
Be sure to address objections like 1) national or security interests (restrictions on trade to protect agricultural self sufficiency or military advantage) and 2) whether the historical record of the US in the 19th century or East Asia in the 20th used protection to speed industrialization
I'm glad you're doing this, Bryan.
The one thing that surprised me is your statement that the Trump tariffs are costing you hundreds of thousands of dollars. How do you get that estimate? It seems like an overestimate by at least an order of magnitude.
Maybe he was referring to the stock market dip that day?
That could be. But when Trump reversed course, the stock market took back virtually all of its losses and has increased since then.
I didn't sell. The tariffs definitely cost me hundreds of thousands initially. But it's unclear why the market recovered. Maybe it would be another 10% higher but for Liberation Dah.
If it's clear to you that the tariffs on April 2 definitely cost you hundreds of thousands initially, why is not equally clear that when Trump backed off from the April 2 extreme, you recovered at least a substantial amount of that loss?
Indeed. Maybe Professor Caplan foolishly panic-sold everything like he did during COVID!
Nah, say it ain't so! Dr. Caplan, you gotta hodl on like you're a roller coaster or a rodeo bull! #yeeeeeeeeHaaaaaaw!
TACO: Trump Always Chickens Out!
Yea, I remember that day too. My stocks took a beating but they picked back up again, a few days later hwhen we realized: he wasn't serious! 😛
That would be my guess. I lost HUNDREDS of dollars that same way/day.
HUNDREDS.
At least I WAS rich. A LITTLE bit.
I hope that it won’t compete with the attention Unbeatable will get with that release timing!
1. Will it cover war (or peace) sanctions? The common example of South Africa as an example of trade restrictions working?
2. I don’t remember if Open Borders or BBB covered objections to using GDP as a measure of economic growth and well-being. This is commonly heard with “We’re a nation, not an economy” slogans.
3. I know you’ll address the decline of manufacturing jobs, but Google Gemini recently brought up an argument that the decline in manufacturing jobs might have caused African American single parenthood rates to climb. I had never heard that before and think that you would have interesting thoughts on that considering your interest in the success sequence.
It would be wonderful if you could add a section on effect of free trade/trump tariffs on developing countries.
Good idea! At the EXTREME end, though not first imposed by Trump, is a full trade blockade. Take Cuba, for example. The US blockades en. Not Canada, though. Hence hwhy I was able to visit Varadero and Havana. How does Cuba feel about the Americans' blockade? Well, they have propaganda Billboards along the side of the highway instead of advertising BillBoards. (Cause they're a Communist country. Of course they do!) One Billboard that stood out to me, said: "Bloqueo: El Genocido mas largo de la historia". Maybe a BIT of an exaggeration. But maaaaaaan, they HATE it!
But not only that, you can talk about how developing countries' own tariffs hurt them and restrain their growth. For example, in the Philippines, flight attendants smuggle groceries from Singapore, there is a black market of onions, coke had to start cutting its regular Coke with aspartame, etc.
It's hard to tell hwhat exactly you're gonna cover from those chapter titles, sir! And hard to know hwhat you consider "non-obvious" but here's a list of topics that I'm hoping you'll touch on:
- Infant Industry argument
- How trade makes both sides better off, including the side with a trade deficit and third-world countries that only have a comparative (not absolute) advantage
- Non-economic arguments against free trade. Like: "We must protect our steel industry so we can still make weapons if our enemies are blockading us." Or "we must protect our food industry so our enemies can't starve us out."
- Environmental arguments for trade restrictions. For example, let's say Canada requires paper mills to install scrubbers so they don't make their town smell like shit. Let's say Mexico does not. Obviously, Canadian paper is gonna cost more than Mexican paper. Can we charge a tariff on Mexican paper to even the playing field a bit, here?
- Non-tariff barriers: Quotas, Export restrictions, export subsidies, labeling requirements, safety inspections, etc.
- Dumping and anti-dumping policies and the absurdity thereof. My old International Econ professor was really into this topic!
- Logistical complications of Free Trade agreements. For example, the EU has Free Trade across EU member states. (Yay!) But if any member state wants free trade with a non-EU country, ALL EU member states have to agree. (Boo!)
- Retaliatory tarrifs and trade wars
- Why hasn't Mexico's GDP caught up with the US yet, despite NAFTA?
- Take a global perspective. Not just the US. How have US tariffs harmed other nations. How have other nations only stupid tariffs harmed them?
- Arguments that free trade hurts exporting nations (for example, drives up prices of Quinoa in Bolivia)
- Arguments that subsidized products harm importing nations. For example, the US subsidizes agriculture, this leads to US food being cheaper than local African food in Africa. hWhich is, apparently, bad for African farmers.
- Concerns about "exploiting" poor people in the Third World
- Concerns about people in the Third World exploiting us!
- "Currency manipulation" (hwhatever that is!)
- KEYHOLE SOLUTIONS!!!
- Abuse of loopholes in trade agreements. Like Trump declaring an "emergency" and using that as an excuse to impose tariffs on Canada and Mexico.
- Maybe something about how many trade agreements leave out certain key industries. Like a trade agreement that allowed Free Trade on everything EXCEPT oil and natural gas, might sound good at first, but would actually be kind of a shitty deal for Qatar. And they might be better served by allowing a 10% tariff on everything.
This is a bigger announcement than Liberation Day!
Maybe it should be called Economic Common Sense Day!
Are export restrictions covered? The whimsical titles don't make it clear that it is covered.
I sure hope so!
Sorry I'm commenting a lot. Some people find that annoying, apparently. I have a lot of ideas. And I hope I'm contribution to the conversation. Dr Caplan, I'd love to see a chapter on keyhole solutions, like you did with Open Borders. It seemed that was missing in BBB. It seems there's no room to compromise with NIMBYs? Except, of course, HOAs which are quasi-government, imo, but I digress. But there's room to compromise with anti-immigration folks, apparently. I think there's plenty of room to compromise on trade!
For example, most Canadian exports to the US are duty-free thanks to CUSMA (which is basically just NAFTA 1.1) But many metals (like steel, aluminum, copper) are subject to a 50% tarrifs. If I was negotiating, perhaps I would prefer a comprehensive tarrif, like 10% on everything, instead of 50% on some things, 0% on others. If they were to throw in full labour mobility with Canada (but not Mexico - come on! Trump is NEVER gonna do that!), then I think this is a much better deal than we have now!
We should be willing to compromise a bit on FREE trade in exchange for more COMPREHENSIVE trade.
So, unlike most Canadians always bitching aboot Trump's tariffs, I actually think Trump's "trade war" with Canada is an opportunity to try to negotiate a better deal. But I doubt Carnie would be able to pull it off!
I'm also kinda curious: How did the left and the right switch sides on trade? I seem to recall back in the early 2000s, leftists were rioting at WTO Conferences, etc. So much so that on 9/11, I thought maybe there was a left-wing terrorist group responsible for the attack on the World Trade Center, before we found out that it was Al-Queda.
But now, it's the right that is very anti-trade. Is it just Trump? Or is it more than that?
One example of a leftist anti-trade argument: Free trade disrupts the local culture of the exporting nation. For example, quinoa. Bolivians love quinoa. So do American health-nuts. Increased demand for Quinoa from American health-nuts is driving up the global price for quinoa so much so that it's out of reach for many poor Bolivians.
There's also the notion that domestic labor, safety, environmental, and other laws should apply to all imports. I think of all such laws, both domestically and as applied to trade, as leftist, even though they have some measure of "bipartisan" support.
Oh, interesting anecdote: hWhat initially planted the seed of Open-Immigration in my head (It's not you, Dr Caplan! 😛): I remember conversing with this leftist guy who had spent like 4 months on a volunteer trip in central America. I was about 15/16 at the time. Knowing that leftists tended to be anti-free-trade, I tried to gently troll him by telling him about my staunch support of free trade. He said he didn't support free trade unless it was accompanied by "free immigration". Something, something about third world workers trapped and being exploited. But, I honestly hadn't thot aboot it before. And I really couldn't think of any objections, so I said: "Sure, hwhy not?"
I later learned in an International Econ course that, even in the absence of "free immigration", free trade benefits both sides more than it harms, including the third-world-workers who produce goods that are exported to rich countries.
But still, open immigration AND free trade is the BEST!
Happy New Year, sir!
I look forward to reading it! Might I suggest including the "race to the bottom" in labor & environmental standards, Taiwan and South Korea's protectionism, antidumping & foreign subsidies, and trade ethics, e.g., cotton from Xinjiang?
Another thing: hWhat about tariffs as political pressure? Like say if they are abusing their own people or invading another country, the free world imposes trade sanctions on them. Yes, it's painful for the country imposing the sanctions, too. But less painful than war. hWhat do you think of that?
No country has renounced tariffs. All countries, even those ranking high in economic freedom indices, retain tariffs and impose them at their own discretion.
And all countries have legions of economists to advise them. So, apparently economists themselves are divided. Recently Walter Block at EconLog make a pertinent observation:
"Some 500 economists work for the Federal Reserve System. This is probably more than the entire dismal science faculty at all eight Ivy League Universities, perhaps with Chicago and Berkeley thrown in for good measure. If the Fed were disbanded, they would all have to seek other work, perhaps leading to prosperity. Under the present institutional arrangements, they undermine the economy. On the other hand, this is an empirical issue. Presumably, many of them would obtain faculty positions, on the basis of which they would be inculcating their charges with the same voodoo economics with which they ruin the economy.
Why? How so? That is because one of their present roles is to determine, among other things, the interest rate. Thus, this job of theirs is “beneath contempt.” "
Here's an argument I constructed inspired by Bastiat's scenario of a ship exporting goods sinking before it reaches its destination to illustrate the balance-of trade fallacy: Some goods and services—such as roads, buildings, and police protection--must be produced domestically because they're impossible to import. For an American protectionist, the worst possible situation would be one in which everything possible to import would be imported into the U.S. from all other nations in the world, who would “dump” all they produce on the U.S. market that they can export and accept no money, goods, or anything else in return. In that case, the U.S. would experience the maximum possible “trade deficit,” and all other nations of the world would have the largest possible “trade surplus.” As a consequence of this international welfare, most Americans could virtually stop working and enjoy much leisure time while the rest of the world starved. Unfortunately for us, this situation couldn't continue for long. At least, the world would learn a valuable lesson about trade that would be hard to forget. Feel free to use this argument. I expect you can improve on it. I require no credit.
I live in an area with a lot of preppers, and they frequently express fears that if we become dependent on strategic “rivals” for goods that would be critical in a military conflict (saline, oil, etc) then we’re kneecapping ourselves as a world power. I’d love to see an analysis of how overstated (or not) these fears are.
Can I pre-order yet?
Be sure to address objections like 1) national or security interests (restrictions on trade to protect agricultural self sufficiency or military advantage) and 2) whether the historical record of the US in the 19th century or East Asia in the 20th used protection to speed industrialization