Two More Trade Tidbits
So little art; not really any deal.
First, as I noted in the previous post, the trade “deal” with the UK is really not a fully fleshed-out deal, but a framework. Supporters need to consider this when assessing the administration’s claims that it is going to rapidly negotiate deals with dozens and dozens of individual countries.
If all it can show with one willing partner is a framework, with details to be announced later, that does not bode well for arting all the deals.
Via the NYT:
President Trump said Britain had agreed to increase market access for billions of dollars of American exports, including beef, ethanol and other farm products under a new trade deal — but left many of the details to be worked out later.
The agreement — promoted by Mr. Trump as the first of many that will result from his efforts to blow up the global trading system — appeared to be more of a framework than a full trade deal. Both sides agreed to drop tariffs on specific products and made general agreements in other areas, but officials from both governments will still need to meet in the coming months to hammer out specific language. That can be a tricky and difficult process, leaving open the possibility the agreement could still fall apart.
It is, therefore, inaccurate to state that the US and UK have reached a deal. They have agreed to keep talking about maybe reaching a deal.
Second, the stupidity of this is just off the scale:
Update: The BBC has some details, which suggest that maybe there is more definition than the NYT reporting provides. We shall see what formal agreement has been reached.
I know that, definitionally, if we buy less from the Chinese, then the trade deficit shrinks. But exactly who gets richer as a result is beyond me. This constant assertion that “we” are richer makes no practical sense.
I suppose consumers who cannot buy certain goods keep their money and therefore are richer in some sense. But, of course, the most likely outcome there is that they will have to spend more for a more expensive alternative, which will make them poorer.
But the dock worker, the trucker, and the like, who lose hours, or maybe even their jobs, are not richer. They are objectively poorer.
Like I noted in the previous post, this is all a choice.
And, a trade partner who, through their own obstinance, have suffered a decade of poor trading partnerships, and which are desperate to get any sort of deal.
Thirty days into their “90 deals in 90 days” timeline, they’ve struck a framework for one deal with one of the more desperate nations.
Even the penguins haven’t copped to a deal yet.
I think he means that the Treasury is receiving more money – ergo “we” (the government) is “richer”
He clearly has no concern for the dockworker, the trucker, even the US consumer in general.
When the monthly customs duties fall as a result to diminished imports, Trump will change the meaning of “richer” again.
BTW, do you suppose that US bakers will stop buying Vanilla from Madagascar, or diamonds from Lesotho?
Maybe this kabuki theatre will satisfy the unqualified orange manbaby enough for him to stop breaking things tho?
As in, Tariff Man can make loud, indecipherable grunting noises and declare victory. His cultlike sheep will then blindly follow whatever he says and agree the libtards are sufficiently owned.
Meanwhile in the background, Lutnick and especially Bessent can quietly negotiate trade policies sane enough to give clarity and save the economy?
Perhaps this is the best we can expect till serious, educated DEI hires are back to replace MAGA’s childish and incompetent DUI hire clown show.
@Bobert:
But if Americans aren’t buying their goods, no tariff is collected, so that doesn’t work.
I think he means that the trade deficit is lower if Americans don’t (or can’t) buy foreign goods.
It is ultimately nonsensical.
Trump, like many people including supposed economists like Peter Navarro, has a dangerous misconception that trade deficits damage GDP. Trump is firmly convinced of this, and it’s bullshit. The same mistake is often made in financial reporting like you see on CNBC or wherever.
I have posted Noah Smith’s (Noahpinion) explanation before, here it is again:
“Noahpinion”
…
Read on for the explanation. And good luck getting through to someone as stupid etc. as Trump.
It’s the Biff con:
Just finishing up the second coat now
Three stupid things I pulled out of that BBC article before I gave up:
1.
2.
3. This is clearly a guy that likes to huff a lot of paint in his spare time.
Having been here a little over two months, my impression of Starmer is that he is WILDLY unqualified to lead a country and is in the process of gift wrapping the country for Farage. The only person dumber than him is Badenoch.
@DK:
No, cause those men are idiots. They are also fanatics.
From what I can tell, the main UK gain is that tariiffs on steel and aluminium drop to zero; and on automobiles, plus everything else, remain at 10%.
With a quota on cars.
As we are hardly massive exporters of steel or aluminium (about £400 million of speciality steels, and £225 million of aluminium) the main benefit is from other goods which were ALSO to be charged at 25% on steel/aluminium content (!).
Though tbf we do have a 10% tariff on US cars; which few people want to buy in any case.
Also I suspect the unmentioned 100% levy on UK media productions (which could wreck UK TV/film production) is being held back as a cugel to avert UK regulation of US social media.
That’s a political powder-keg waiting to detonate, as there is a big issue re. Facebook pushing toxic content to teenagers.
Also, food standards are an issue: if US food is labelled as such, re hormones and such, it won’t sell.
So expect a US push for “no labels”.
Which will also cause a UK political backlash,
There are a lot of devils waiting in a lot of details.
Its all more political spin than substance, and we still end up with the shitty end of the stick.
Thanks a lot for very little, about sums it up, seeing as we are still charging nothing on most equivalent US goods.
@Steven L. Taylor: It’s non-sensical if you think the goal is to adopt better trade policies.
It’s not non-sensical if the goal is to impoverish the barely rich & rich adjacent so that you now have leverage and incentive for them to go along with anything that keeps them out of the ranks of the Hoi Polloi. Said another way—the goal is to create hunger in the most threatening social class of Americans, i.e the Professional Class so that the only teet out of subsistence living is the Trump family and adjacent ecosphere.
This is the only way authoritarian systems work—why else would the RW echo chamber be lavishing admiration on systems where the income of the avg citizen is around $500 bucks a month? The large class of subsistence livers in those countries are kept in check by a layer of people that, in exchange for middle class living, provide a buffer between the riff raff and the oligarchs.
This is the real plan
@JohnSF:
I’d happily join that backlash. Other than the pop* being absolute garbage and there being an absolute lack of salt in everything, the food is way better and cheaper here. Having read about the chicken thing, I think it’s stupid, but I get it. I don’t think most American will though. I’m pretty sure Starmer doesn’t get it either.
Although, watching Starmer twist himself into knots over the winter fuel cuts and looming disability cuts doesn’t inspire much hope. That guy is gonna get rolled cause he doesn’t seem to get that people don’t want a hard right party, a pretend hard right party and squishy hard right party. Too many Democrats in the US seem to think the same thing.
And I guess it makes me a Communist to think that maybe budgets and trade deals shouldn’t be balanced on the backs of the poor, the old, or working class.
* I had my partner bring me several cans of real Sprite the last time she went to CA for work.
@Jim X 32:
Reading about how much the Silicone Valley oligarchs hate their manager/professional class employees has been eye opening. I think you’re absolutely right about this.
Right up to the point where the oligarchs decide to feed their professional class to the wood chipper. Cause these oligarchs are fucking weirdo morons that think they don’t need people.
@Steven L. Taylor:
Yes nonsensical, but let me try to explain why I imagine Trump understands “richer”.
And if I’m off base in my understanding of the process.
March 2025 US imports increased by 4 something percent
April 2025 US imports increased by 5 something percent.
Together these increases in imports are the highest month over month increases for the past several years
The general understanding is that importers were ramping up activity in advance of being hit with larger tariffs (after the “pause”).
As far as when the tariff are paid to the Treasury, it is my understanding that (generally speaking) these duties are paid either on entry to the US or at the port of departure BY THE IMPORTER Whether these goods are actually being bought by US consumers, is irrelevant to the duties collected.
So Treasury receipts (from tariffs) have increased significantly in March and April – hence Trump’s “we are richer”
Now, If I’m off base or misunderstanding something, I’ll be grateful for correction.
@Bobert:
It would be more accurate to ask how the felon rapist misunderstands something. I think understanding is denied to him.
FWIW, we used to pay import taxes (aka tariffs) after filing a declaration of the content and origin of the goods involved, which required papers from the exporter and shipper. In cases when packages were inspected, not often, we’d pay what customs assessed, which was usually the same as what we’d declared.
Exporting 13,000 tonnes of beef to the UK will not even be noticed in America’s 1.3 million tonne beef export industry. But I came across something I don’t understand.
Firstly, “For the full year of 2024, total UK fresh and frozen beef imports totalled 241,000 tonnes”. OK, makes sense, small heavily-populated country needs to import lots of food. But then there was also this: “For the full year of 2024 exports increased by 9,000 tonnes reaching 113,000 tonnes”. So Britain exports half as much beef as it imports? How does that make sense?
@JohnSF:
I’m sure if the UK dropped their exorbitant tariff Detroit would be eager to provide the UK with RH drive cars adapted to British tastes, including cramped cities, narrow lanes, and $6.66/gal petrol. (If my Google and arithmetic are right.) About as eager as Kansas farmers to grow bananas and vanilla.
Used some Chlorox today and noticed the label “ produced in the USA from global sourced materials.”
Who would have thought?
@Ken_L:
UK exports quite a lot of premium beef to the EU.
(for steak, roasting rib and sirloin)
Imports quite a lot of less expensive beef which is used for pre-processed food, mince, stewing beef etc.
@JohnSF: “Also, food standards are an issue: if US food is labelled as such, re hormones and such, it won’t sell”
I was wondering about this. During the press conference a British reporter asked specifically about beef imports, and Trump started rambling about how we’re such a big country that we have all kinds of beef, which suggested to me that the Brits suggested they might accept some beef but only if it were completely organic and raised without hormones and all the rest… and that the total amount will end up a lot closer to zero than what the Trump teams wants us to believe.