You know, there’s nothing I love more than watching Ali Velshi on MSNBC take apart some brainless GOP twit, usually a congressman, who dares to venture into the economic logic arena with Velshi. And it’s always amusing to watch other hosts and analysts on MSNBC and CNN ridicule Trumpanomics with simple math. But you’d expect them to do that. What’s always a pleasant surprise is when even the “experts” on FOX News feel that they have to take exception to his claptrap once in a while.
Sunday was such a day. Trump has based his whole dead battery calculator economic rantings on what should be a now familiar yin and yang. On the yin side, Trump loves to bluster about our horrible trade imbalances, and how abused we are, resulting in big trade deficits with foreign countries. On the yang side, Trump loves to fluff himself endlessly about all of the foreign investment money he’s bringing into the US.
This was the conservative economist who was a guest on one of FOX’s show’s whole point. Namely, where in the ever loving hell did Trump think that all of this foreign investment capital was coming from? Answer: from companies that are buying American export goods at a lower price than they’re charging for the goods they ship here. That “foreign investment” money Trump keeps bragging about is those companies way of ensuring adequate supply and quality of products to sell in their markets at a larger profit due to the lower initial cost, while paying less to sell their products in the US..
The bottom line seems to be, at least in this way of computing the numbers, is that if we impose tariffs to make it more expensive for those companies to sell their goods in the US, they’ll stop investing foreign dollars into our companies, and use the money to offset the higher tariff prices instead. The Trade deficit may go down, but so will the foreign investment by a commensurate amount. A zero sum game in other words.
The phrase that immediately leaped to my mind when I saw this segment was “Robbing Peter to pay Paul.” But it’s little wonder that Trump doesn’t understand this simple principle. The ethos of his entire business life has been, “Robbing Peter to rob Paul. To rob Mary, to rob Phil, to Rob Marty.” You get the picture.