Foreign trade deficit = subsidies...
Yes, of course, Donald, and now please inject yourself with disinfectant. 🫠
Yes, of course, Donald, and now please inject yourself with disinfectant. 🫠
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•@PowerWordChill don't seem to know much about the subject?
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•@PowerWordChill What makes you think that?
Do you have a different opinion? If so, please explain, I'm very curious to know how you intend to reconcile these two things.
Do you have a different opinion? If so, please explain, I'm very curious to know how you intend to reconcile these two things.
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•@PowerWordChill damn you are factually interested, just wanted to troll but: High subsidies for domestic producers can make imports less attractive and increase exports, which can reduce a trade deficit. So understand that Trump intends to subsidize the domestic industry to reduce the trade deficit with Canada
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EDIT: since 2021, the trade deficit is probably actually -244 bn $.
https://www.census.gov/foreign-trade/balance/c1220.html
@stocker_328 @PowerWordChill..
Trump's logic: If the USA imports more from Canada than it exports (trade deficit), then it is indirectly "subsidizing" Canada because Canada benefits more from this trade.
EDIT see above.
USA-Canada trade balance
According to official statistics: the USA has not had a trade deficit of USD 200 billion with Canada in recent years.
In fact, trade between the two countries is relatively balanced:
The US exports approximately USD 300 billion worth of goods and services to Canada each year.
The USA imports a similar amount of goods and services from Canada.
Depending on the method of calculation, there is sometimes a small deficit or a surplus.
It suggests that the USA is being economically "exploited" by Canada.
He used this to justify tariffs on Canadian steel and aluminum imports as well as the renegotiation.
In terms of classification:
Trade is not a "subsidy": a trade deficit does not mean that one country is financing the other.
Canada is one of the largest buyers of US products: So punitive tariffs also hurt US companies.
Conclusion:
Trump's statement was a simplification of trade relations with Canada, presumably to underpin his "America First" policy. In reality, trade flows between the US and Canada are balanced and both countries benefit from each other.
https://www.census.gov/foreign-trade/balance/c1220.html
@stocker_328 @PowerWordChill..
Trump's logic: If the USA imports more from Canada than it exports (trade deficit), then it is indirectly "subsidizing" Canada because Canada benefits more from this trade.
EDIT see above.
USA-Canada trade balance
According to official statistics: the USA has not had a trade deficit of USD 200 billion with Canada in recent years.
In fact, trade between the two countries is relatively balanced:
The US exports approximately USD 300 billion worth of goods and services to Canada each year.
The USA imports a similar amount of goods and services from Canada.
Depending on the method of calculation, there is sometimes a small deficit or a surplus.
It suggests that the USA is being economically "exploited" by Canada.
He used this to justify tariffs on Canadian steel and aluminum imports as well as the renegotiation.
In terms of classification:
Trade is not a "subsidy": a trade deficit does not mean that one country is financing the other.
Canada is one of the largest buyers of US products: So punitive tariffs also hurt US companies.
Conclusion:
Trump's statement was a simplification of trade relations with Canada, presumably to underpin his "America First" policy. In reality, trade flows between the US and Canada are balanced and both countries benefit from each other.
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•@VPT sorry, but the source is more than questionable.
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@stocker_328 the figures seem to be correct:
https://www.ceicdata.com/de/indicator/canada/total-exports-to-usa#:~:text=Kanadas%20Gesamtexporte%20nach%20USA%20belief,Durchschnitt%20von%2023%2C331.015%20USD%20Mio.
Or if you'd like it from a government site:
https://ustr.gov/countries-regions/americas/canada
Have you found other figures?
https://www.ceicdata.com/de/indicator/canada/total-exports-to-usa#:~:text=Kanadas%20Gesamtexporte%20nach%20USA%20belief,Durchschnitt%20von%2023%2C331.015%20USD%20Mio.
Or if you'd like it from a government site:
https://ustr.gov/countries-regions/americas/canada
Have you found other figures?
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@VPT @stocker_328 better fact check official US government site: https://www.census.gov/foreign-trade/balance/c1220.html
Edit: over the last 4 years you get 200+ billion dollars
Edit: over the last 4 years you get 200+ billion dollars
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•@intelligent_invest_99 thanks for the addition. But the export sums are really not insignificant for the USA 🥲
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@PowerWordChill I see the whole thing basically like this: Why do I subsidize something or try to protect it with tariffs?
Because it is obviously not competitive on its own. Does eliminating the competition make it more robust?
I always think of the example of American cotton, which was or continues to be subsidized so much (I'm not up to date on this) that it depresses the price of African cotton to such an extent that African producers could/can barely survive from growing it, even though it is/was grown much more sustainably. In the end, this is a completely inefficient approach in which everyone involved loses in the long term.
Or England in the 19th century, which imposed high tariffs on German products and also passed a trademark law which stipulated that products from Germany had to bear the words "Made in Germany" from then on. This was triggered by British producers' concerns about German competition.
We all know the outcome of the story: "Made in Germany" went from being a warning sign to a seal of quality. In the long term, the British domestic market was not strengthened but weakened.
In the end, as in nature, the most innovative and resilient always prevail. I doubt whether I am promoting these characteristics by creating an artificial biotope through relatively high tariffs.
But hey, Donald only has four more years. Until the consequences of his actions are felt in full force, he is no longer POTUS - at least I hope so, otherwise we have completely different problems, I'll just say this much: at the end of last year a movie with Wagner Moura was shown in the cinemas - and can - as usual with him - blame it on others.
Because it is obviously not competitive on its own. Does eliminating the competition make it more robust?
I always think of the example of American cotton, which was or continues to be subsidized so much (I'm not up to date on this) that it depresses the price of African cotton to such an extent that African producers could/can barely survive from growing it, even though it is/was grown much more sustainably. In the end, this is a completely inefficient approach in which everyone involved loses in the long term.
Or England in the 19th century, which imposed high tariffs on German products and also passed a trademark law which stipulated that products from Germany had to bear the words "Made in Germany" from then on. This was triggered by British producers' concerns about German competition.
We all know the outcome of the story: "Made in Germany" went from being a warning sign to a seal of quality. In the long term, the British domestic market was not strengthened but weakened.
In the end, as in nature, the most innovative and resilient always prevail. I doubt whether I am promoting these characteristics by creating an artificial biotope through relatively high tariffs.
But hey, Donald only has four more years. Until the consequences of his actions are felt in full force, he is no longer POTUS - at least I hope so, otherwise we have completely different problems, I'll just say this much: at the end of last year a movie with Wagner Moura was shown in the cinemas - and can - as usual with him - blame it on others.
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