Trumpwatch 2.0

[Matt]

https://apnews.com/article/donald-trump ... afd57ae759

Another day, another unlawful and despicable move by the Trump regime.

[Rate This]

https://apnews.com/article/donald-trump ... afd57ae759

Another day, another unlawful and despicable move by the Trump regime.

Musk has no business in the government. Since he’s unelected he doesn’t answer to anybody and frankly I don’t want him and his cronies anywhere near payment systems and potentially sensitive data.

Not to mention they are grossly incompetent.

[MWmetalhead]

I think a boycott of Tesla would be a great idea.

[Matt]

Does Bill Cassidy have the balls to stand up for his principles and protect HHS from RFK, Jr. or will he be a disgraceful partisan hack.

Tommy Tuberville has to be the dumbest motherfucker to ever serve in the Senate.

[MWmetalhead]

I hope you're right on point #1, and I completely agree on point #2.

[MegaHertz]

I think a boycott of Tesla would be a great idea.

*stares intensely at TC Talks*

[bmw]

The tariffs on China in his first term didn't do a damn thing to bring down the trade deficit. In fact, the trade deficit grew.

According to the US Census Bureau, that is not true. Except for a small dip during the 2008-2009 recession, our trade deficit with China had been rapidly climbing since 2000, up by more than 400 percent by 2018. It was mid-2018 when the first round of tariffs took effect. There was a substantial drop in 2019, with our deficit dropping from $418 billion to $342 billion. Most of that drop was pre-Covid. Even in 2022 when the deficit went back up coming out of Covid, that number of $382 billion deficit was still 8% lower than the 2018 peak. The number in 2024 is down to $270 billion - a 35% drop from our 2018 peak.

Long story short, it looks to me like our trade deficit with China began its first reversal in at least 20 years beginning the same year Trump's first round of tariffs went into effect, and keeping in mind that Biden kept most of those in place and even expanding them, we look to be on a continued downwards trend.

Now whether that change in trajectory is attributable to tariffs or was naturally due for a correction is up for debate (Covid certainly threw a wrench into everything, but again, the first big drop came in 2019), but I don't see support in those numbers for your claim that the trade deficit with China grew after the Trump tariffs.

Green line on graph below represents when first round of tariffs took effect.

[TC Talks]

I think a boycott of Tesla would be a great idea.

Oh, Tesla is already experiencing the fallout. Some guy is counting the Cybertrucks damaged. It's actually a viral thing.


The reality is that Tesla has more US parts than any other vehicle.

[bmw]

Tariffs such as those imposed on Canada and Mexico will harm profitability of domestic companies whose supply chains are intertwined with those countries, will lead likely lead to retaliatory actions by those countries (particularly Canada), will cause manufacturers to pass along increased input costs to consumers (which will lead to reduced purchasing activity as measured by quantity), and will harm corporate profitability - which means many stocks could be in for a rough year. These combined consequences could certainly lead to a recession, perhaps a significant one.

Certainly reducing the corporate tax rate would offset much of that, no? In 2023, the federal government collected a record $445 billion in corporate taxes. If we're importing $400 billion in goods from China, a 10 percent tariff amounts to a $40 billion tax. We imported $481 billion from Canada (1/3 of which was energy imports), so a 25% and 10% tax respectively on that would be $96 billion, and for Mexico, a 25% on $455 billion would amount to $114 billion.

So some basic math here:
$40 billion tax on China goods
$96 billion tax on Canada goods
$114 billion tax on Mexico goods

A corporate tax rate cut from 21% to 15% would cut corporate taxes by $127 billion. That offsets the tariffs by almost exactly half. Then, if those tariffs make it cheaper to produce some of that stuff here instead, that number gets further offset.

My problem with what Trump is doing is that he hasn't set forth any benchmarks for how long the tariffs will remain in effect. For what he's doing to work in theory, corporations need that piece of information before they would be willing to start moving production from overseas to the US.

[km1125]

Tariffs such as those imposed on Canada and Mexico will harm profitability of domestic companies whose supply chains are intertwined with those countries, will lead likely lead to retaliatory actions by those countries (particularly Canada), will cause manufacturers to pass along increased input costs to consumers (which will lead to reduced purchasing activity as measured by quantity), and will harm corporate profitability - which means many stocks could be in for a rough year. These combined consequences could certainly lead to a recession, perhaps a significant one.

Certainly reducing the corporate tax rate would offset much of that, no? In 2023, the federal government collected a record $445 billion in corporate taxes. If we're importing $400 billion in goods from China, a 10 percent tariff amounts to a $40 billion tax. We imported $481 billion from Canada (1/3 of which was energy imports), so a 25% and 10% tax respectively on that would be $96 billion, and for Mexico, a 25% on $455 billion would amount to $114 billion.

So some basic math here:
$40 billion tax on China goods
$96 billion tax on Canada goods
$114 billion tax on Mexico goods

A corporate tax rate cut from 21% to 15% would cut corporate taxes by $127 billion. That offsets the tariffs by almost exactly half. Then, if those tariffs make it cheaper to produce some of that stuff here instead, that number gets further offset.

My problem with what Trump is doing is that he hasn't set forth any benchmarks for how long the tariffs will remain in effect. For what he's doing to work in theory, corporations need that piece of information before they would be willing to start moving production from overseas to the US.

And if any production is moved back to the USA, then there are also the taxes collected on all that investment (at the very least the payroll taxes from the workers now employed to build or operate the new production).

[TC Talks]

Certainly reducing the corporate tax rate would offset much of that, no? In 2023, the federal government collected a record $445 billion in corporate taxes.

So you're premise is that lowering taxes benefits consumers and not shareholders? Boy, you're an idiot.

[TC Talks]

And if any production is moved back to the USA, then there are also the taxes collected on all that investment (at the very least the payroll taxes from the workers now employed to build or operate the new production).

Humor me, how long would you estimate moving manufacturing of even a simple product to the US would take?

Let's say a washing machine.
-Motor
-ECM
-Encasement
-Power Cable

And how much do you think it will cost with a reasonable profit?

Finding the engineers in this job market alone will be daunting. Again, you people haven't thought this through.

[zzand]

I haven't seen anyone mention that unions would organize at these facilities so there would be legacy costs on every washer they built. Kinda like the legacy costs on every vehicle built in a union shop in the states.

[MWmetalhead]

BMW is correct that the trade deficit with China did drop substantially for a time, and then it began to grow again in 2021 & 2022, even though Biden kept the Trump tariffs on China in effect. The trade deficit with China then fell sharply in 2023 & fell a bit in 2024.

What I should have said earlier is that despite the tariffs on Chinese goods, our net global trade deficit continued to rise during Trump's first term in office. (And as I noted earlier, trade deficits are not innately a bad thing.)

As we know, the economy is dynamic based on changes in tax policy. There are ripple effects. The equation of estimating tariff revenue and offsetting it with corporate income tax rate cuts to arrive at a zero sum is not as simple as the arithmetic bmw suggested in his earlier post. There are different winners & losers, and changes in tax policy will change investing and consumption behaviors. Moreover, any reduction in the corporate income tax rate would be of zero benefit to the large number of companies who file on Form 1120 or Form 1065. (Income of those companies is taxable at the equity holder level and therefore gets included on the personal tax return filed by each equity holder and is taxed at personal income tax rates.)

Tax Foundation analysis:
https://taxfoundation.org/research/all/ ... trade-war/

American Enterprise Institute commentary:
https://www.aei.org/op-eds/trumps-tarif ... -disaster/

Peterson Institute for International Economics:
https://www.piie.com/blogs/realtime-eco ... good-thing

The fact the Canadian and Mexican tariffs harm multiple companies that sell automobiles in the United States but not Tesla is likely not a coincidence given the fact Elon essentially funded Trump's campaign.

Ford, GM, Honda, Toyota, Stellantis and perhaps others all export multiple models built in Canada for sale in the U.S., including a rather high percentage of RAV4 hybrid vehicles sold in the U.S.

[Matt]

This is stunning: https://www.detroitnews.com/story/news/ ... 159087007/

Washington – The Trump administration has placed two top security chiefs at the U.S. Agency for International Development on leave after they refused to turn over classified material in restricted areas to Elon Musk's government-inspection teams, a current and a former U.S. official told The Associated Press on Sunday.

Members of Musk's Department of Government Efficiency, known as DOGE, eventually did gain access Saturday to the aid agency's classified information, which includes intelligence reports, the former official said.

Musk's DOGE crew lacked high-enough security clearance to access that information, so the two USAID security officials – John Vorhees and deputy Brian McGill – were legally obligated to deny access.