This thread is for a discussion of economics. Politics belongs on
Q: Does the rise of populist movements in America and Europe threaten international trade and, if so, is this a good or bad thing?
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/Econ/ Economics General #3: Trade Policy in 2017
Lincoln Edwards
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Easton Hernandez
Discussion does not have to be limited to the question in the thread. I just put those in to get a discussion starting. Feel free to post any econ or econ-related investing questions in this thread.
Julian Hill
Why is Krugman such a fucking blatant partisan hack?
William Reed
Because he runs the NYT column. Krugman makes all Keynesians look bad. He says that deficits don't matter under Obama and then says that deficits suddenly matter under Trump. He's full of smugness.
I disagree with Keynesianism, but outside of Krugman, I can have an intelligent discussion with one.
Samuel Carter
he makes some good points
only thing he doesn't realise is that republicans don't want a deficit still, they don't want to spend on building and infrastructure
it's only trump that wants that
Joshua Garcia
This is very true. I'm a bit dubious of the whole exuberance after the Trump election, even as a Trump supporter myself, because i feel a lot of it is driven by the expected fiscal stimulus.
At best, he'll pass out a tax credit for infrastructure investment or something. When Trump has to focus on getting McConnell and Ryan to support his immigration agenda first and foremost, you can expect that to go. They're already discussing a border tax, which makes such policies even more unlikely.
Justin Ramirez
Larry Summers is the same way. He's spent years shilling for a massive infrastructure program and as soon as Trump proposes one he slams it as "economic creationism," whatever the fuck that means
Christopher Carter
That border tax is probably one of the worst ideas I've ever heard. I was tepid toward Trump. Didn't mind him except for his dreadful trade policies. If the border adjustment tax goes through, inflation will kick up like no ones business. Pair that with a tax holiday on overseas earnings and the USD will REALLY make a day of it.
Robert Martin
Yeah I agree. I'm not denying China doesn't do stuff like IP theft, but dealing with it by using tariffs sets a dangerous precedent for the international trade system.
What do you think are the odds of the policy actually getting passed? I assumed the House would stop Trump fiscal stimulus and give him immigration, but trade seems to be in the middle. It's a defining issue for Trump, up there with immigration, but the Republicans in the House and Senate are ardent defenders of free trade.
Landon Gutierrez
Pseudoscience belongs on Not only can macroeconomists not form any kind of consensus, but macroeconomic theory does not hold any predictive power, nor has it ever. Macroecon fails both tests for being considered a science and is literally just "here are some opinions mixed with a few irrelevant numbers that me and my financial sponsors happen to believe."
Carter Hernandez
t. david suzuki
Luis Lopez
Summers was probably referring more so to Peter Navarro's ideas on international trade rather than infrastructure, but Summers is still a dick.
Henry Martin
>Does the rise of populist movements in America and Europe threaten international trade and, if so, is this a good or bad thing?
Maybe in the short term, but perhaps not in the longer run. Of course, in the beginning some of these populist movements will run protectionist trade agendas to try and keep up with the promises that got them into office. Within some time though, those policies might drive up the prices of products for everyday people by enough that it would be political suicide to continue.
At that point, the entire mindset of protectionism might shift. For example, trade agreements might be renegotiated such that they better reflect the foreign policy interests of the United States. I recall someone suggesting in the long run that we might end up embracing Mexico and diverting investments from China to enhance their economy. That way, we could stem off or even reverse illegal immigration by making the economies of our neighbors livable, all the while perhaps starting some kind of economic union with them.
Maybe the last part is a bit of a stretch, but in any case I think that protectionist trade will become too politically unwieldy to continue enforcing in the long run.
Asher Clark
Most likely. Looking at the Reagan Revolution, there were a lot of protectionist measures implemented, like import quotas on Japanese cars and the Plaza Agreement, despite all the fervor about Milton Friedman and supply side economics. But it was followed by the free trade boom of the 1990s, so I'd assume this is just temporary. If you go after Chinese subsidies and make the business climate in America more conducive to business, things should clear up.
Jack Baker
>That way, we could stem off or even reverse illegal immigration by making the economies of our neighbors livable, all the while perhaps starting some kind of economic union with them.
I honestly think this is the best way to deal with a lot of problems - economic, social, environmental
Lincoln Smith
An economic union with other nations to make their nations livable would be good. I think that using our trade agreements to target more policy initiatives would a step in this direction, for instance, how our trade agreement in the 2000s made them privatize Japan Post. Using that on a larger scale with countries like Mexico and more importantly China could help other nations transition to market-based economies in an orderly manner and satisfy the protectionists by leveling all nations to a market-based standard and satisfy by free traders by expanding globalization.
Ryan Wilson
"Making the economies of our neighbors livable" is a pretty broad term. It could refer to free trade agreements as seems to be arguing, or it could be something along the lines of the World Bank and the IMF.
Could you be more specific?
Wyatt Hill
>t. Passed freshman macroeconomics with a C
Adam Taylor
kek
Zachary Collins
>ITT NEETs and wcon 101 students pretend to know what they're talking about
James Perez
I'm in Econ 203, get on my level faggot
Jose Thompson
>tfw in Mathematical Econ, Public Policy Econ and Econometrics
My levels cannot be matched
Eli Scott
Congratulations on mastering multiple equally useless fields of study.
Julian Sanchez
If economics is such a hard science, then why have economists always dismissed looming financial crisises like the 2007/2008 one, and simultaneously predicted all kinds of bullshit like hyperinflation that never materialized?
Luke Mitchell
Not going into an economics job, just enjoy the topic. Interning at the local Chase headquarters during the school year and going back for year 2 at Chicago during the summer.
Pretty comfy with my major, so thanks
Aaron Diaz
>hyperinflation never happened or was close to happening
Someone's a millennial
Carter Williams
They've been predicting it in the US since 2000. So where is it?
When the results of a physics experiement disagree with a model, physicists respond with "here is why our model is wrong and how to fix it." When an economist's model disagrees with their data, they say "here is why our data is wrong and how to fix it."
Kayden Martin
It happened in the 70's, inflation was really really about to fuck the U.S during that inflationary period, Volcker only barely pulled us out of it by raising unemployment by a shit ton
That was being predicted every since WW2, but it happened nearly 3 decades later, your span of
Carter Flores
So changing perspective on data is bad?
Ryder Turner
Something something... broken clock... something... right twice a day
>So changing perspective on data is bad
That's the problem: they don't change their perspective based on data. When the data disagrees with the model, they think the problem is with the experimental data rather than the possibility that their model is faulty. See the episode where a spreadsheet error in an economist's study caused Europe to nuke itself financially.
Charles Gomez
>Does the rise of populist movements in America and Europe threaten international trade and, if so, is this a good or bad thing?
Why the fuck would that be a good thing for the economy? Trade less, close everything, buy all national and fuck the rest are ideas that should have died in the 18th century. But no, blue collars think they are entitled to jobs in dying, inefficient or soon-to-be-automatized industries just because and refuse to be retrained.
Julian Jones
Someone predicts the next big financial crisis every week. Then when one does happen everyone gets mad at the people who didn't listen to the crazy "the end is near" guy.
Thomas Cooper
I was just meme'ing, I've read a lot of economics in my free time. Are you currently employed in an econ-related position? What's the job market for econ majors like?
>equally useless fields of study
Found the STEMfag :^)
If you're using that as your metric for a hard science, mind explaining how Newtonian and Quantum physics are both used in different settings, yet utterly contradict one another?
I may be using the wrong terms for what it is i'm referring to, but there's a lot of stuff in other hard sciences that isn't definite. Your point is irrelevant anyway, economics, hard or soft, is still subject to various interpretations of data.
>implying the inflation of the 1970s was "hyperinflation"
It was bad, but it wasn't hyperinflation. Nixon, Ford, and Carter were not the American equivalents of Robert Mugabe.
It resulted from the fiscal, not monetary, policy of the 1960s in the guns and butter rally. That was created by Keynesian thought.
We don't have that kind of stuff. The stimulus that we had, though ineffective, was meager spending compared to what some Keynesians would've wanted it to be at. We injected nearly $4 trillion, if not more, into the economy as part of monetary policy and there's a difference. When you're in the zero lower bound, you can take radical actions in monetary policy and still have little to no effect on inflation.
Who's "they?" Most mainstream economists haven't been predicting this. The ones who have are mainly Austrian economists, who reject the use of empirical data modeling in favor of praxeology.
Pretty much this. I consider myself a free trader and economically speaking there's nothing wrong with it. I think there are certain national security effects to be taken into account, for instance, China using its state owned companies as fronts for its military or illegal export subsidies and the sort that challenge the market consensus.
Isaac Jones
my country practically killed PEMEX with taxes and now they giving it to USA
dailymail.co.uk
Ayden Rodriguez
There's nothing wrong with privatizing PEMEX kek, it's the market at work
Jonathan Gomez
>being a protectionist
Maybe with the US something good will finally come out of PEMEX.
Easton Nguyen
This, it's not a coincidence that one of Mexico's slowest and least competitive sectors is run by a state monopoly. How is it that you can defend the company that has presided over falling oil production for every year since 2009?
Also, pic related. Even by the standard of other state-owned oil companies, PEMEX looks like shit
Jose Young
You're confusing actual economics with pop-economics.
Peter Schiff being a fuccboi on cnbc isn't actual economics.
aeaweb.org
This is a good resource.
Ian Morgan
Schiff for brains couldn't even make money off of his predictions. His clients lost money in 2008 because of his conspiracy theory bullshit (businessinsider.com
Aaron Cruz
>judging the field of economists
>uses Austrian predictors
Austrian economics reject all forms of empirical data modeling in favor of praxeology, a series of assumptions about human behavior.
In other words, you're basically judging the validity of chemistry by people with homeopathic medicine degrees.
Henry Bell
International trade isn't threatened because "capitalism in one country" can't work. What is happening is American hegemony has been slowly collapsing, an economy based on military Keynesianism... that keeps losing wars... will destroy itself. You'll eventually have a Soviet Union style "collapse" and restructuring.
The global system of trade requires a central dominant city to act as the coordinator and clearing house of international capital... it was Venice in 1450, Antwerp in 1550, Amsterdam in 1650, London in 1850, and New York City in 1950. If America wants to stop exporting capital someone else will just take on the role.
Noah Mitchell
Here's the global economy for the next 8 years.
USA USA USA USA USA USA USA USA USA.
Sorry chingchongbong commiefuckland no more easy money for you.
Canada is already getting fucked and now shits crashing even further. Short the Canadian housing market because by Dec it's gonna be in a pit so big you can stuff 6 million in it.
Justin Stewart
Too bad America makes its money by riling up sand people and then selling them a shit load of guns. There is literally no shortage of muslims or niggers to piss off and make a buck off of. Eventually they might end up wiping themselves out but that's just a win-win
Aaron Sanders
How much economics did you have to take in college to participate in this thread?
Do you have to know micro to be able to discuss macro?
Samuel Brooks
What about the resulting actions of protectionism that could occur? For instance, a trade war between America and China would be catastrophic for China, America, and the rest of the world, wouldn't it?
I'm a sophomore in college and have taken four semesters of economics, but I've read into it in my spare time before (especially political issues dealing with economics).
I'd say you don't have to learn micro to discuss macro. I took a class in macro before I did one in micro and the stuff in macro made sense. Most of macro and micro 101 are the same concepts, just applied to different areas (for instance, supply and demand, equilibria, elasticity, etc. etc.), but there are things you learn in macro that you wouldn't learn in micro and vice versa.
Zachary Peterson
>no more easy money for you
What's going on in Canada? I've heard about the massive boom in real estate, but I was of the impression that Asian investors will continue sending their money to other markets until the Chinese get their shit together and stop seizing assets of successful businessmen
(before you call me a cuck I voted for Trump plsnobully)
Owen Mitchell
wired.com
Hard scientists are wrong as well, economics isn't really an outlier in that respect.
Liam Gomez
Krugman is great. Right up until he goes anywhere near politics. Then he speaks with the same authority as he does on economics despite understanding politics on a highschool senior level.
James Cox
Source: your ass