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Mick Harper
Site Admin
In: London
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| Wiley wrote: | Yes, free trade is always best if you happen to be the most efficient producer around, but you need tariffs to protect your industries if they're not.
Why? What exactly is the point of protecting industries that cannot compete. |
The theory--and often borne out by practice--is that they will be able to compete if allowed to develop behind tariff walls.
| Tariffs might make sense protecting profitable industries during recessions, so we arguably should be sympathetic when other nations apply them during their domestic downturns, eg India, China.... |
Downturns aren't of long enough duration to affect the issue. The only one that was, the Great Slump of the nineteen-thirties, provided equivocal evidence of whether tariffs helped or hindered.
| But what is the point in the UK or the US doing this when they are simply not that competitive and not in recession? |
I entirely agree with you. Politicians though have to work to a shorter time frame than world-beating industries being reduced to rust belts, but it is normal to use domestic subsidies rather than external tariffs.
| The US steel industy already has all the inbuilt advantages of the Build America Buy America Act, ie the domestic content procurement preference requires that all iron, steel, manufactured products and construction materials used in covered infrastructure projects are produced in the United States ... This protectionism is really about as bonkers as it gets. |
Tell Trump, not me.
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Wile E. Coyote
In: Arizona
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| The theory--and often borne out by practice--is that they will be able to compete if allowed to develop behind tariff walls. |
How?
What is going to happen? Are they going to spring a brilliant technological innovation that will enable U.S. manufacturers to catch up and overtake the Chinese?, are they going to reduce costs to Chinese levels?, are they going to ban foreign competition by law for ever? (is this competing?) or are they going to be able to opt for ever-increasing levels of public subsidy. In 1950, 32% of all U.S. employees worked in manufacturing. By 2019 that share had fallen to 8%. The idea that tariffs are going to reverse this is as farcical as thinking that the Luddites might have been onto something.
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Boreades
In: finity and beyond
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Not so much mentioned in all the MSM hysteria is that the EU is one of the most protectionist groups around.
The situation pre-Trump2 was the EU had more in tariffs on US goods than the other way round.
I'm wondering if Trump's end game is not tariffs, it's no tariffs at all.
All his crazy flipcharts of tariffs is political theatre to get the EU (and others) off balance and desperate to make a deal.
And then Trump gets more PR glory for "having solved the problem"
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Wile E. Coyote
In: Arizona
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Good grief I also get all dewy-eyed about devastated groups of tight knit working class communties, just like I do about endangered groups of hunter gatherers, but I am not going to pretend that we can sensibly reinvent the world of the 1950s......
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Mick Harper
Site Admin
In: London
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| Wiley wrote: | The theory--and often borne out by practice--is that they will be able to compete if allowed to develop behind tariff walls.
How? What is going to happen? Are they going to spring a brilliant technological innovation that will enable U.S. manufacturers to catch up and overtake the Chinese? |
I was not referring to the US, I was attacking the orthodox idee fixe: 'Free Trade/good, Protectionism/bad'.
| are they going to reduce costs to Chinese levels? |
Could do. Labour costs are only one input. But it usually means investing in so much machinery as to be futile. (And which defeats the original purpose of mopping up local unemployment.) [But the Brits seem to be doing well inventing Heath Robinson machines for fruit and veg after the Slavonian packers have been sent packing.]
| are they going to ban foreign competition by law for ever? |
But speaking of America specifically, this has emerged as a potent factor. One day seems to have an effect!
| (is this competing?) or are they going to be able to opt for ever increasing levels of public subsidy. |
As I said, tariffs are instead of subsidies. The first is a stealth tax on consumers, the second requires actual deduction from wage packets. It makes a difference.
| In 1950, 32% of all U.S. employees worked in manufacturing. by 2019, that share had fallen to 8%. The idea that tariffs are going to reverse this is as farcical as thinking that the Luddites might have been onto something. |
No doubt they will become more targeted as Trump retreats to Key Largo and the boffins at DC take over. Your 8% figure is a bit revelatory. Like discovering from Countryfile that agriculture is less important than the call centre industry.
| Borry wrote: | | Not so much mentioned in all the MSM hysteria is that the EU is one of the most protectionist groups around. |
Yes, that is kept quiet about. But the Europeans have always been more unholier-than-thou.
| The situation pre-Trump2 was the EU had more in tariffs on US goods than the other way round. |
But at least the Yanks are finally getting clued in on VAT requiring tariffs, not being a tariff.
| I'm wondering if Trump's end game is not tariffs, it's no tariffs at all. |
After the endless GATT rounds the world was largely non-tariff. There are more ways to skin imports than are dreamt of in your philosophy, Donald.
| All his crazy flipcharts of tariffs is political theatre to get the EU (and others) off balance and desperate to make a deal. And then Trump gets more PR glory for "having solved the problem" |
He's less the Great Deal Maker, more the Great Spot The Main Chance operator. And then 'The move swiftly on if you didn't' Man.
| Wiley wrote: | | Good grief I also get all dewy-eyed about devastated groups of tight knit working class communties, just like I do about endangered groups of hunter gatherers, but I am not going to pretend that we can sensibly reinvent the world of the 1950s...... |
You are breaking a fundamental rule of AE, Wiley. Nothing must be ruled out ipso facto, sine die and ad nauseam.
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Boreades
In: finity and beyond
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| Wile E. Coyote wrote: | | Good grief I also get all dewy-eyed about devastated groups of tight knit working class communties, just like I do about endangered groups of hunter gatherers, but I am not going to pretend that we can sensibly reinvent the world of the 1950s...... |
First they came for the miners...
etc etc
Where's Arthur Scargill when you need him?
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Mick Harper
Site Admin
In: London
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I loved his "British coal is the cheapest deep-mined coal in the free world" claim. 'Free world' ruled out cheaper deep-mined coal from Apartheid South Africa. As for 'deep-mined', what was it we said to the coal merchant while our hessian sacks were being filled with nutty slack?
| "Are you sure this is deep-mined, my good man?" | |
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Boreades
In: finity and beyond
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I do like our "Where in the world..." questions.
| The world’s top exporters of coal ranked by total shipment weight are Indonesia, Australia, United States of America, South Africa, Canada and Mongolia |
I believe they are all open-cast mines. Certainly nothing like traditional cloth cap Yorkshire villages with a winding tower and a deep cast mine.
How about the cheapness?
| The lowest average unit prices for exported coal per ton are charged by international suppliers in Tajikistan (US$26 per ton), Kazakhstan ($36), Kyrgyzstan ($38 ), Botswana ($52), Uzbekistan ($67), Nigeria ($72) then Malaysia ($73). |
Again, pretty sure they are all open-cast mines, with no local branches of the Council for the Preservation of Rural England, or the Health & Safety Executive to bother them.
Once upon a time M'Lady and I were taken on tour of the vineyards in the Hunter Valley in New South Wales, Australia. To get there, we had to go past the open cast coal mining area. Which stretched for about 100 miles. The sheer scale of it was astonishing.
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Mick Harper
Site Admin
In: London
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| Certainly nothing like traditional cloth cap Yorkshire villages with a winding tower and a deep cast mine. |
I wish somebody would tell me how they got the coal to the surface. I have seen footage of lifts bringing miners to the surface thousands of times (count 'em) but never once (not never) of coal coming up in the lift.
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Mick Harper
Site Admin
In: London
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I heard the weirdest thing on Radio 4. It occurred during a series of (quite good) programmes on the British tax system. Yesterday's episode was devoted to VAT and centred on the well known case of whether Jaffa Cakes were cakes (zero-rated) or biscuits (top rate).
The star of the case, a McVitie Biscuits executive, had had a giant Jaffa Cake prepared which was wheeled into court to illustrate how it was a cake and not a biscuit. It was, he said, a Max Jaffa cake. The presenter of the programme joked that, although Max Jaffa was a well-known bandleader of the time, this was entirely coincidental. The witness meant it was a maximum Jaffa cake. The talking head expert agreed with him.
I just gaped.
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Mick Harper
Site Admin
In: London
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I ought to add that we adopted VAT as a condition of joining the EU in 1973 and it replaced Purchase Tax, levied on all goods at the point of sale. We then made a right bollix of it by trying to use VAT as a progressive version of the regressive Purchase Tax. We did this by having three VAT bands:
* a zero rate for 'essentials'
* a low rate for things customarily bought by the poor
* a top rate for 'luxuries'.
So we not only ended up with lunacies like treating biscuits as luxuries but the money ending up in Treasury coffers was way down from the 15% Purchase Tax, which was applied across the board and which everyone had got used to paying and hardly noticed they were doing so.
If we had got rid of VAT exemptions at any time, Rachel Reeves would not only have enough cash-in-hand to look after every poor person her backbenchers deem careworthy, she would have enough left over to go to war with Russia. We're talking in the region of a hundred billion, give or take.
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Boreades
In: finity and beyond
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VAT exemptions can still be arranged, if you have the best kind of accountants.
Step 1: Create a UK registered company, and register for VAT with HMRC.
That means when your company buys anything with VAT on it, you declare it on your quarterly VAT Return to HMRC as Input.
Ordinarily, and mostly, a UK company then selling goods or services to any other UK company, or the compliant public, would add VAT at the going rate 20%.
That you also declare it on your quarterly VAT Return to HMRC, but as Output.
What your company owes HMRC is simply Output minus Input.
Here's the loophole:
| If you sell, send or transfer goods out of the UK you do not normally need to charge VAT on them. |
So:
Step 2: Arrange your customers so that they are all registered outside the UK
Then:
Step 3: Make your quarterly VAT Return to HMRC in the normal way.
Input VAT is (whatever)
Output VAT is zero.
Result?
You get a refund from HMRC
Lovely jubbly!
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Boreades
In: finity and beyond
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I cannot comment on whether this also applies to the Intellectual Property payments made by AEL UK Limited to Mike_In_Jersey_Ltd.
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Mick Harper
Site Admin
In: London
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Countryfile (BBC-1)
At last! They featured a bloke who was breeding Maremmano-Abruzzese Italian guard dogs. I have long been arguing that these are a cheap and effective antidote to birds of prey, walkers' dogs, badger tuberculosis and half a hundred ills besetting the modern farmer.
The bad news is he has only sold one litter, officially for keeping foxes away from free-range chickens, but actually as pets-cum-prestige adornments. "I'll breed some more if anyone asks," he told Countryfile cheerfully.
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Mick Harper
Site Admin
In: London
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I won't be able to watch the most important game of my footballing year, Arsenal vs Real Madrid, despite my paying for every sports channel known to mortal man. After I paid my subs, the dogs announced they were slipping one match every round onto Amazon Prime. I am not a member of Amazon Prime, it not being a sports channel.
I could sign up for a thirty days free membership, watch the match, and then not take up membership except the last time this happened--by accident because I pressed the wrong button when ordering something from Amazon--it took a couple of years to discover I was signed up to Amazon Prime and then a further period (though I acknowledge not an inordinately long period) getting my money back.
But that's not the worst of it. For some reason Amazon are refusing to let the main Euro-coverers, TNT, show the whole match later. Or even extended highlights later. I am allowed fifteen minutes tomorrow afternoon and/or ten minutes on the BBC in the evening. I hope it was worth adding me to your detractors, Amazon. I was the last holdout.
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