Gingrich predicts a lot of global conflict over trade

Newt Gingrich, who works closely with Donald Trump, suggests a lot of conflict over Trump’s approach to international trade.

“I think if you apply a new standard, which is, is this good for the United States economy, as opposed to, is this good for some kind of global system, you’re going to be in a lot of conflict with a lot of countries.”

In some ways a global trade shake up may initiate some change for the better, but it also risks changes or the worse.

This comes down to trying to impose one sided trade conditions using one’s ‘enormous leverage’ versus conducting good bi-lateral trade relationships.

Taking a heavy handed bully approach may achieve some short term benefits for the US, but in the longer term it is likely to discourage trade with the US and encourage trade agreements and relationships between other countries.

And there could also be negative consequences in the US as well, financially for the country as well as politically for some.

18 Comments

  1. David

     /  July 16, 2018

    Someone should give Trump a call and point out the massive trade restrictions there are on NZ cheese and beef going into the US and see if he wants a global level playing field.
    I tentatively support his aim of lowering trade barriers and tariffs I just hope it becomes a global thing not just a US thing.

    • Griff

       /  July 16, 2018

      Trump is lowering trade barriers and tariffs how?
      Trump has refused to sign free trade agreements, reneged on long standing agreements already in place and introduced tariffs.
      Trumpies really are deluded.
      As to agriculture.
      The USA subsidizes farming to the tune of 25 billion a year.
      Not bad for an industry that earns about 60 billion net a year.
      https://www.thoughtco.com/us-farm-subsidies-3325162

  2. Blazer

     /  July 16, 2018

    he doesn’t want a a global level playing field though…Gingrich states the..obvious.

  3. Gerrit

     /  July 16, 2018

    The Harley Davidson example is a good one in terms of what Trump is rallying against.

    American made cars and motor cycles face a 10% tariff when imported into the USA (as an aside, the USA imposes a 2.5% tariff on EU made cars).

    To bypass this EU tariff, Harley Davidson set up a factory in Thailand to service the European and Asian market.

    Now they want to imported these cheaper built Harley Davidsons into the USA. Killing USA jobs. So Trump is proposing a tariff to prevent this.

    All seems pretty simple if you are keen to protect USA jobs.

    https://www.reuters.com/article/us-harley-davidson-tariffs/trump-blasts-harley-plan-to-shift-u-s-production-to-avoid-eu-tariffs-idUSKBN1JL185

    Interestingly the steel tariff have hit the sheet metal producers who do not have iron and steel making facilities.

    https://www.reuters.com/article/us-usa-trade-steel-jobs/trump-steel-tariffs-may-leave-these-u-s-steelworkers-jobless-idUSKCN1GL2V9

    You can really see the problems in that it it easier to moan about the cheap sourced Asian steel slabs, used to roll steel sheets, than to gather raw material from a US based smelter.

    • Griff

       /  July 16, 2018

      To bypass this EU tariff, Harley Davidson set up a factory in Thailand to service the European and Asian market.

      Now they want to imported these cheaper built Harley Davidsons into the USA. Killing USA jobs. So Trump is proposing a tariff to prevent this.

      Bullshite.
      Hardly makes bikes for Asian in Thailand .
      As a result of Trumps trade war they decided they would also build bikes for Europe there.

      Wisconsin Sen. Ron Johnson (R) said Sunday that motorcycle manufacturer Harley-Davidson was right to move parts of its production overseas.

      Johnson told host John Catsimatidis on New York’s AM 970 that his state has been hit particularly hard by reciprocal tariffs from other countries angered by President Trump’s trade actions.

      “Because of the beginning of the trade war…our state has been particularly targeted,” Johnson said. “Harley-Davidson has been targeted, our cranberry industry, our ginseng industry, but people don’t realize that Wisconsin is a huge manufacturing state.”

      Harley-Davidson, based in Milwaukee, Wisconsin, announced late last month that it would move part of its motorcycle production overseas citing rising costs from European Union tariffs on its products.

      In a filing, the company cited the European Union’s decision to implement tariffs on motorcycles imported from the U.S. for its decision. The EU tariffs came in response to the Trump administration’s move to implement hefty steel and aluminum tariffs on the EU and other countries.

      “We’re a big steel-using state. Steel tariffs are hitting us pretty bad, pretty hard,” he added. “That raises the costs of American-manufactured products, of Wisconsin-manufactured products.”

      Johnson said Harley-Davidson’s owners weighed the costs of steel and aluminum tariffs, which the senators said had led to “30 to 40 percent” price increases on steel, against transportation costs incurred by manufacturing overseas.

      “What happened with Harley basically is the trade war. They were paying 6 percent tariffs [to get] into Europe, now it’s 31 percent,” Johnson said. “If they manufacture in another country they can enjoy the lower steel prices and remain competitive.”

      “So they really don’t have a choice,” he added.

      http://thehill.com/homenews/senate/397044-gop-senator-harley-davidson-is-right-to-move-its-plants-overseas

      • Gerrit

         /  July 16, 2018

        “Harley-Davidson, based in Milwaukee, Wisconsin, announced late last month that it would move part of its motorcycle production overseas citing rising costs from European Union tariffs on its products.”

        Exactly the point I was making…no BS, please read what was written.

        Under the tariff scheme if Haley Davidson wanted to bring Thailand manufactured bikes into the USA they would have to pay the import tariffs.

        Only a fool would think Harley Davidson would only move production to Thailand just to beat the EU import tariff – they want to increase profits from cheaper production costs in Thailand by exporting back into the USA)

        Trump is lifting the tariff for the reason I explained (confusingly badly) in my comment.

        USA made cars/bikes face a 10% tariff into the EU, EU made cars/bikes face a 2.5% tariff coming into the USA.

        He is simply balancing the equation.

        If Harley Davidson made the bikes in the USA, for USA consumption there is no need to worry about the Trump tariff on imported products.

        Harley Davidson wants the cake and eat it as well instead of supporting USA jobs. .

        • Griff

           /  July 16, 2018

          Hardly has never said anything about building bikes for the US market offshore.
          Ever .
          It is in your head .
          You cant argue facts with deluded fantasists who just make up shite to suit them self’s .

          • Gerrit

             /  July 16, 2018

            hahaha, have a bridge for sale just for you if you think the cheaper bikes made in places like Thailand, Brazil, India wont be imported into the USA when the accountants pursue the profit motive to make the share price jump up.

            So naive.

            Which bridge would you like? Have them all for sale.

    • NOEL

       /  July 16, 2018

      Most mill around the world were once integrated. Usually considered a strategic asset.
      As the US Bessemer steel mills dated, the owners closed down or reduced the steel making side and invested heavily in mini mills who took the steel from any supplier with the right price and processed it into finished products.

      NZ Steel is one of a only a few integrated steel mills left and survives because uniqueness of its iron sand to steel process.

      • Gerrit

         /  July 16, 2018

        Yep, reminds me of this song

        “Well my daddy come on the 0hio works
        When he come home from world war two
        Now the yards just scrap and rubble
        He said, “Them big boys did what Hitler couldn’t do”
        These mills they built the tanks and bombs
        That won this country’s wars
        We sent our sons to Korea and Vietnam
        Now we’re wondering what they were dyin’ for

  4. Gerrit

     /  July 16, 2018

    Correction

    “American made cars and motor cycles face a 10% tariff when imported into the USA”

    Should read “American made cars and motor cycles face a 10% tariff when imported into the European Union”

  5. Zedd

     /  July 16, 2018

    said it before; If Mr T starts a ‘trade war’ then the rest of the world could cripple their economy, by stop buying: coca-cola/pepsi, mcCrap, KFC, starbucks etc. (their biggest global trade monopolies)

    • Zedd

       /  July 16, 2018

      these companies maybe ‘global franchises’ that create employment.. BUT for every item sold, a percentage is returned to the USA parent companies !!

    • David

       /  July 16, 2018

      It’s odd you didn’t know that Google, Facebook, Apple, Microsoft, Intel etc are all far, far larger global trade monopolies.

  6. Gezza

     /  July 16, 2018

    Aucks doesn’t have enuf pedestrian crossings