Post B1JG5AL8W4SK4qDE5w by SteveRoth@mastodon.world
(DIR) More posts by SteveRoth@mastodon.world
(DIR) Post #B1GDF856sxkOdDtbDE by interfluidity@zirk.us
2025-12-15T03:48:53Z
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if the world lifted all tariffs but deficit countries committed to filling any domestic demand gap created by trade imbalance with efficiently implemented military build-up, perhaps surplus countries would seek a more balanced path.(not really recommending this. it’s a thought experiment.)
(DIR) Post #B1GDepYGOwbGgwmsJk by eARCwelder@mastodon.social
2025-12-15T03:53:30Z
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@interfluidity Hasn’t the United States sort of done that military build-up thing? Although it’s also the one providing all the demand. The error of the tariffs has been in their blanket imposition, instead of them being laser-targeted at surplus countries, China in particular. It makes no sense to tariff Canada or India right now, e.g.
(DIR) Post #B1GNcCruFiptgFMXc8 by interfluidity@zirk.us
2025-12-15T05:45:06Z
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@eARCwelder it really makes little sense to tariff China either. tariffs are very shitty tools. the only kind that make any sense are narrowly targeted to sectors rather than sources. the US has not matched increasing trade deficits with increasing military expenditure, and certainly has not efficiently implemented conversion of fiscal inputs to military outputs. the US “provides demand” by running large fiscal deficits, but not linked to military menace.
(DIR) Post #B1GOSaEWczEvCfuxAO by interfluidity@zirk.us
2025-12-15T05:54:34Z
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@eARCwelder (taking control of balance of payments is far from a shitty goal, though! it’s just that there are much better tools, on the capital side, to do that.)
(DIR) Post #B1HAKJT1sKpMggp8jo by eARCwelder@mastodon.social
2025-12-15T14:50:50Z
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@interfluidity I’m OK with the China tariffs, which even Biden supported to an extent, because at least they’ve moved the U.S. beyond just hoping for the best from “free trade.” They’re not enough on their own—and who knows, they might be gone soon and then we’ll be back to the “good old days” of a growing trade deficit. Maybe Japan can provide a test case of the deficit-country military buildup theory, but the early returns from its relations with China aren’t promising.
(DIR) Post #B1HGsiEitE054wv09w by interfluidity@zirk.us
2025-12-15T16:04:22Z
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@eARCwelder i agree it’s good to move beyond “free trade” dogma. i just think tariffs are for the most part a really terrible tool, so terrible in fact they may well discredit my view that the balance and composition of trade is a necessary and legitimate object of policy, and give succor to foolishly dogmatic “free trade” under the usual neolib “see, TINA. we told you so.”trade balance should be regulated on the regulatory, that is capital-account, side.
(DIR) Post #B1HHmHeMvMTOq6Pcv2 by interfluidity@zirk.us
2025-12-15T16:14:21Z
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@eARCwelder (no country is linking military expenditure to trade deficit that i know of. Japan i think now runs a small trade deficit but its overall balance of payments remains positive. it’s really the overall current account deficit that represents the demand drag fiscal policy, potentially military, gets called to fill. one wldn’t expect, if a country did this, it would improve relations with surplus powers. the point is to make surplus countries perceive themselves as “financing” a threat.)
(DIR) Post #B1HINOkdU9hTZs2ce8 by eARCwelder@mastodon.social
2025-12-15T16:21:04Z
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@interfluidity Right, I agree that negative polarization against tariffs could provide cover for reversion to strident (and destabilizing) “free trade” policies. Plus, SCOTUS potentially invalidating some tariffs could have the added effect of restoring its legitimacy with some liberals. At the same time, I think it may be hard for the U.S. to give up on tariffs completely. The politics of a Democratic president lifting a bunch of tariffs to provide relief to China’s exporters are terrible.
(DIR) Post #B1HIchOoR17fl085su by interfluidity@zirk.us
2025-12-15T16:23:53Z
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@eARCwelder you’ve got to have the courage to do something better at the same time. i wouldn’t have wanted Biden to restore Obama trade policy. i would have wanted him to make an affirmative case for balance-promoting capital controls, though, as an alternative to the Trump tariffs he inherited.
(DIR) Post #B1JG5AL8W4SK4qDE5w by SteveRoth@mastodon.world
2025-12-16T15:04:47Z
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@interfluidity slightly more serious thought experiment: match the demand gap with universal income