But we both agree, that "general tariff first - look where to compete second" isn't the real deal, don't we? If I get you right, you are pretty much advocating a punctual tariff anyway...
But I don't think even that is needed: As I said before, realistic expectations of longterm revenue will make the companies grow on their own.
Plus you don't know how everybody else counteracts: Answering with protectionism themselves would be very likely, which would be kinda a step backwards in times.

It's a necessity in terms of dealing with the deficit in balance of trade since it strengthens the exports and makes it harder for imports.

That thought falls a little short in my opinion: You ignore that a tariff is actually pretty bad for domestic consumers, they have to pay a lot more than before. The jobs that are artifically created by that tariff, don't make up that inefficiency - don't just take my word for it, take Adam Smiths if you like.

Well, that brainchild forced the US into the largest Depression in history, i wouldn't put too much faith in them. Abolishing the FED is IMHO the best proposal S_E made, among many pretty simple-minded ones.

Does that mean that you disagree that a tariff would allow exporting companies to grow? Even if the trade imbalance continues and the dollar weakens we would still be trading with our current disadvantes, so I don't see how it would be different than having a tariff. It would just allow us to continue to trade our currency in the world for when we need to, no reason to harm the dollar if we don't need to.

The inneficiencies in production, even with a weakened dollar would still exist with a tariff but without the harmed dollar and with an added bonus of revenue from the tariff.

The increased demand for production jobs would just help the economy, because there would be a higher demand for jobs to generate money that isn't sent overseas. The trade imbalance is causing Americans to buy products with more money than they are creating, so the jobs would put more $ into the economy.

I don't mean to make you try and argue against your opinion or anything but you seem knowedgeable in economics so I was wondering if a weakened dollar would harm the economy in any way, despite it increasing exports and decreasing imports.

Yes, I have respect for Adam Smith but he exagerates on some things, by saying that a completely free market is better in EVERYTHING, when it is just better in most instances.

The Great Depression would have been caused, if anything from a lack of government regulations of people taking out huge loans to invest in the stock market it anything. (Not that I am saying that the fed should do otherwise) If not, than the Fed seemed kind of neutral for the Great Depression. I would be curious why exactly you think the fed started it.

Your argument on trade is too simplistic, and basically wrong. If we are creating a new sector that was once produced in a foreign country, then we must first assume that this product is necessary, otherwise what is the point in developing the sector in our own economy. You have to consider the consumer value of the product as well as the producer. The consumer would lose big time, while the producer would gain a little. In this case the producer cannot make good profit margins without a ridiculous tariff on what is essentially slave labor goods. The consumer would have to pay a much larger price for the goods than before, and 3 to 4 times the amount is not out of the question given how low wages are in other countries.

The net effect at the very beginning is negative because consumers lose big and producers make very little. Now if you stop right there it might not seem so bad, but then you must consider the fact that the overall spending power of the consumer is now reduced, so demand for other domestic goods and services falls as well. This basically becomes a difference in distribution of wealth as opposed to strengthening our economy. The only time things like this are really a big problem are with goods and services that if too dependant on another country would cause them to have too much bargaining power. This is one good reason many nations regardless of their opportunity cost produce food within their own borders. The issue with China and the US is simply a matter of opportunity cost. They can push out cheap products much easier because of a massive amount of labor that is cheap. The areas we have a chance in beating them are capital intensive industries.

Overall, it isn't so much an issue with China as it is people who cannot control their spending. I agree that we need to reduce imports and get our trade balance back in check, but what we really need to do is just cut back on borrowing from other countries. This country is and has been living above their means for a couple decades at the very least. Our social programs are not sustainable and instead of trying to inject more money into them, we probably need to start cutting back. We need to stop buying useless crap and stop the thinking that bigger is a necessity rather than a luxury.

By the way, the weakened dollar is a sign of correction more so than anything. It is acting as a big brother in a sense that people cannot recklessly buy stuff from other countries, while making it cheaper to purchase our goods. Most of the time free markets are always trying to achieve balance, and this is one way it achieves it through fluctuations in the value of currency. The downside of course is that we have less spending power in the global market. Too many people equate the appreciation of money vs other countries as the greatest thing ever, and a depreciation as a sign of doom. Overall the end result is a value that should otherwise balance trade on the global market. The reason we didn't see a depreciation sooner in my opinion is because the confidence in the US repaying our debt, especially in China just recently lowered by a fair amount. The confidence in our financial market and currency is not in the best of shape. Regardless this should act as a correction to our spending habits and overall balance of trade, but based on opinions about the election and how most people act today I'm not too confident that people are intelligent enough to respond accordingly.

You are simplifying the situation because you aren't addressing how much it would help the producers of the product that is made with a tariff.
If a product domestically because revenue wouldn't be lost from the cost of purchasing it from other countries. Even if the cost for a product is twice as much, if the revenue from the good is directed immedietly back into our economy so people could more easily purchase the product, because of their wages for the product.

My main point is that if the American value lost more of its value than consumers would have to pay more for products overseas, and in effect they would be paying the same added price as if a tariff was enacted. However, since we would be enacting the tariff we would have more power to control how our exports increase and our imports decrease, with a sellective tariff. A tariff could be focued on certain industries that require high capital and education. A tariff would also generate income while a weak dollar would not.

To expand my idea about tariffs furthur we could even apply substidies on the certain industries that we want to export that could solve the trade imbalance and still allow the united states to import large quanities of products that we don't have a chance on importing. China currently imposed substidies on exports, and it is helping their exports very well. So if we put substidies on certain exports for industires than we have a chance of competing so our exports would increase, while the costs for products with no tariffs or substidies bought from overseas would not.

A constantly weakening dollar would also help to cause even more inflation, which would harm people's budgets.

And it is apparent that you just don't get it. Let's say the chinese can put out a product for $1. Let's say that we can do it here for $4. The difference in price is therefore $3 for the consumer. Now considering our labor is several times more expensive than it is in China, let's say that for a good like this we make $.25 of each product. The net benefit for the producers is far lower than the increased prices that the consumer now must pay. The end result is a transfer payment. Instead of several million people saving $3 on the product, you have a company making maybe a quarter off each, and employees that they can hire. The end result is that this is a transfer payment. We are redistributing wealth from the consumer to a new producer, while losing an overall surplus in terms of the model because the surplus gained from the producer is far less than the increased cost to the consumer.

The difference is that Chinese labor is paid nothing, while ours is paid at the very least minimum wage. This is the very reason some companies outsource their work because they can turn a much better profit. The only time the above is ever hurtful is if there is absolutely no other work available. If you want to argue that we should be supporting more wealth distribution in your example, so be it, but you are terribly wrong in thinking that the net result for the economy is a benefit.

I graduated with a degree in economics. Trust me I'm not bull(*)(*)(*)(*)ting you.

"A constantly weakening dollar would also help to cause even more inflation, which would harm people's budgets."

A constantly weakening dollar is due to inflationary pressure partly by the FED with their interest rate cuts and mainly because people are taking out way too much in credit. The people losing their houses lost it because they either couldn't afford it, or took out horrible loans. The benefits of trade can still exist in this situation, but the bigger issue at hand is that americans have been saving -1.5% of their earnings. As a result you are going to see a weakened dollar and a contracted economy because people overstepped their bounds in spending.

lol if you read my post you would see that I am starting to agree with you that a tariff would not work on low cost products that don't require much education or capital investments. Good explanation of the benefits of a general tariff, I was trying to figure out how much money would be saved in the economy but I had no idea.

I just saw in national geographic that it takes the average Chinese industrial worker 6 months to get enough money to buy a Thomas the Tankengine set, so we aren't able to compete in that, so I have basically given up on the benefits of a general tariff. Now I am thinking about a sellective tariff to start getting a niche in the global market.

That is just a thought, if a tariff and an export substidy was used in an industry like airplanes, than we could export more and get a more positive trade balance.

Since you have a degree in economics could you answer this question: If the dollar declines in value to a point when there is no trade defecit would the cost of those products be the same if a general tariff was enacted to when there would be no trade defecit. I have asked this question and no one has given me an answer, it seems that the problems with a tariff will happen regardless if we want it or not. The money gained from a tariff could than be used to substidy exports.

There is obviously other effects that will cause even more inflation than a weakened dollar but I am just saying that a weakened dollar would contribute to inflation. I just saw a new thread about how China is dumping our currency because it is losing lots of its value and that is causing inflation. Are you saying that there will not be inflation if the dollar loses its value compared to other currencies?

I was thinking that there would not be that inflation, Americans could travel, and we could focus on certain industries if we used a sellective tariff and substidy instead of just allowing the dollar to lose its value.

It's a little more complicated than that. If you look at the inflation we are experiencing now, most of it is strictly due to the cost of oil and the pressure it is putting on businesses to raise their prices. It's resource based inflation. Now part of this inflation is due to a lack of confidence in our market because people are spending more than they are producing (making in money).

"I just saw a new thread about how China is dumping our currency because it is losing lots of its value and that is causing inflation. Are you saying that there will not be inflation if the dollar loses its value compared to other currencies?"

When money is dumped into an economy it will decrease the value of currency. Money is simply a representation of the goods and services we produce. You can look at it this way.

Let's say a country's GDP is 1 million, and they have 1 million pieces of currency. 1 piece of currency represents 1 piece of GDP. Now let's say that government prints 1 million more pieces of currency that instant with a GDP of 1 million. Now each piece is 1/2 of GDP and the purchasing power of each is half of what it was before. Since our market is shaky now you have people cashing in and flooding the market with dollars. Likewise even with no additional increase in currency, if GDP falls or the confidence in growth falls then you will see a drop in value of the currency as well, which is also what we are seeing.

Well we do subsidize the production of airplanes just like Europe does with airbus. We also export products that are capital intensive. The main issue with our economy isn't that we don't have a broader range of production, it's that we have a credit craze and other countries are typically the producers. If we were to produce locally the same issues would occur if people overstepped their budget.

Yeah, which means that the trade defecit is causing inflation which is one reason that the trade imbalance should be corrected sooner rather than later.

I may start a thread asking this question, but if the dollar is declining in value wouldn't a tariff just increase the prices for products bought overseas the same amount as if a tariff was instituted? In that sense a tariff wouldn't be any worse than a harmed dollar.

1. End Social Security, Welfare,Medicare,Medicaid and foodstamps for all abled bodied man and women.

2. Lower Income tax to around 15%.

3. Decrease Corporate tax by half.

4. End payroll tax.

5. End Death tax.

That should do the trick.

__________________
"True Freedom is the Freedom to oppress others"

Keep in mind that if the US imposes tariffs on imports China there is likely going to be a reaction from China. They are not going to just sit there and accept it.