What is a trade war? 101

Leaving politics right out of this, lets talk about how trade wars work. Then you be the judge of who wins and who loses. (Economics is kind of my thing)
If a country wants to protect an industry, say like steel or Aluminium, it has several options.. One, to place a tariff (a charge or tax) on any imported steel. Two, to set quota limits requiring a licence to import it. Three to subsidize the local people to allow them to sell their stuff cheaper. (Remember Farm subsidies)
Now if a nation does any one these, the oversea export country is likely to pick another product the US is selling them and do the same thing, So.. Who wins? Not the consumers.. Either way, they end up paying more for stuff made from Steel and Aluminium, and not the people trying to sell their other products, say food, which is already costing the consumers money in farm subsidies and now they still cant sell, against the other guys tariff..
So who wins?? The governments at either end, pocketing the tariff money...
That's why no sensible person WANTS a trade war.... There ARE NO WINNERS!!!

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Crusher69 · 61-69, M

Free trade is the only way - encourages industries to adapt and innovate and efficiency - if you cant compete you evolve or basically die. Protecting industries just distorts the economy and allows for lazy business to survive. Here in NZ it is pretty open re trade.....

firefall · 61-69, M

@Crusher69 NZ certainly used to be far too protected & it was tremendously damaging (thanks Muldoon). But pure free trade is also poison - because it ignores the powers of international cartels to destroy for short term gain*. In a pure market, free markets would be great, but no pure market has ever existed.

(*there's a TV program studying the effect of this on West African agriculture that was very persuasive)

whowasthatmaskedman · 70-79, M

Yes... And over the ditch, so are we.. The "lousy" trade deal the US pulled out of has already backfired on then.. The other partners cobbled together a smaller deal.. But that's not the important part. If the US ever wants to come in, they will not be able to set the ground rules the way the original deal was set in their favor with patents and intellectual property.. I say thank goodness for Trump on that one.@Crusher69

Crusher69 · 61-69, M

@firefall yes I agree, you need everyone on side and that aint gonna happen (short term greed maybe?) - but pushing free trade is probably better than the alternative

Crusher69 · 61-69, M

@whowasthatmaskedman Yes - that deal is probably better without US being involved

whowasthatmaskedman · 70-79, M

The only way the US is used to doing trade deals was if the won big.. The win on the TPP was not big enough for them, so it was not popular at home. But now they are out in the cold and its starting to dawn on their businesses what that means for profits.. Next come the jobs.@Crusher69

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whowasthatmaskedman · 70-79, M

YES!!!!! By George you have got it. That's why your "free trade " deals need to rob other countries blind and insist on making rules to suit yourselves.. You could so that while you were inside these deals.. But you pulled out of the TPP and broke the spell..The rest of the world can do just fine. @TotalMiss

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whowasthatmaskedman · 70-79, M

Because he is selling you the idea that its good for America.. Your economy and politics was broke before, that's what got him the job. He is just throwing fuel on the fire to burn the place down@TotalMiss

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whowasthatmaskedman · 70-79, M

Backs slowly toward the door, smiling and not making eye contact@TotalMiss

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