Section 122 of the Trade Act of 1974 (19 USCA 2132) provides the President authority to address ‘balance of payments” 9not current account) imbalances if such imbalances threaten an”imminent and significant” depreciation/appreciation of the dollar. The provisions related to the across the board tariff increases states the balance of payment deficits must be such that the dollar is likely to experience a significant depreciation. I am not sure folks have actually read the statute since no one seems to be addressing whether these conditions are met.
Yeah, not a lawyer so I didn’t wanna comment too much on the legal side of it without expertise, but it really does not seem like this round of tariffs has the strongest legal founding either
He missed the boat that left in the 70s and 80s, when we stopped making everything we stepped off the ride. The rest of the world has moved on. These policies would have to be in place for 50 years to bring back any kind of manufacturing. It’s way worse than most Americans realize, not only did we stop making things we stopped mining, refining and smelting, stopped and scrapped the infrastructures. These are the foundations for nations, natural resource extraction and refinement. These are not easily replaced, a single iron refinery can now cost 3 to 5 billion and take a decade to complete. Montana had 4 or 5 of these when I was a kid, they are all gone for years. Montana use to produce huge amounts of copper another crucial metal, no working copper mines, the remaining operation are just running stockpiled ore just to keep them operating. 20 miles away is a 900 ft deep gold and silver mine that built this entire town, more millionaires per capita for any city west of the Mississippi in 1900. It’s a ski area now and has been for 50 years. A tiny amount of silver was pulled when prices were up 20 years ago but this silver ore had been mined and stockpiled 100 years ago and left in the flooded mine. We still have the minerals in the ground, we just don’t have the facilities, equipment or workers to change this back. No one wants to work in an underground metal mine or a smelter now. That workforce is breathing their last breaths. It’s completely idiotic to run a country on imports especially if we allow corporate America to dictate the terms, but it’s even more idiotic to think that a few years of trade law changes will have any meaningful impact on the situation.
An important question is who, of the American consumers, is footing the bill? With the notable exception of Chinese goods, the payers are buyers of luxury goods who can afford it. There is no alternative to Hermeś but California wine is acceptable for most. Tariffs are not a total miss for Trump and his base. Time will tell on the longer dated items like manufacturing.
Section 122 of the Trade Act of 1974 (19 USCA 2132) provides the President authority to address ‘balance of payments” 9not current account) imbalances if such imbalances threaten an”imminent and significant” depreciation/appreciation of the dollar. The provisions related to the across the board tariff increases states the balance of payment deficits must be such that the dollar is likely to experience a significant depreciation. I am not sure folks have actually read the statute since no one seems to be addressing whether these conditions are met.
Yeah, not a lawyer so I didn’t wanna comment too much on the legal side of it without expertise, but it really does not seem like this round of tariffs has the strongest legal founding either
Especially since the dollar is down anyway
So someone is likely pretty quickly to seek a stay from USCIT?
Really solid commentary, analysis. Much appreciated!
Thanks Jared! Means a lot coming from you
Excellent
Thanks John!
He missed the boat that left in the 70s and 80s, when we stopped making everything we stepped off the ride. The rest of the world has moved on. These policies would have to be in place for 50 years to bring back any kind of manufacturing. It’s way worse than most Americans realize, not only did we stop making things we stopped mining, refining and smelting, stopped and scrapped the infrastructures. These are the foundations for nations, natural resource extraction and refinement. These are not easily replaced, a single iron refinery can now cost 3 to 5 billion and take a decade to complete. Montana had 4 or 5 of these when I was a kid, they are all gone for years. Montana use to produce huge amounts of copper another crucial metal, no working copper mines, the remaining operation are just running stockpiled ore just to keep them operating. 20 miles away is a 900 ft deep gold and silver mine that built this entire town, more millionaires per capita for any city west of the Mississippi in 1900. It’s a ski area now and has been for 50 years. A tiny amount of silver was pulled when prices were up 20 years ago but this silver ore had been mined and stockpiled 100 years ago and left in the flooded mine. We still have the minerals in the ground, we just don’t have the facilities, equipment or workers to change this back. No one wants to work in an underground metal mine or a smelter now. That workforce is breathing their last breaths. It’s completely idiotic to run a country on imports especially if we allow corporate America to dictate the terms, but it’s even more idiotic to think that a few years of trade law changes will have any meaningful impact on the situation.
An important question is who, of the American consumers, is footing the bill? With the notable exception of Chinese goods, the payers are buyers of luxury goods who can afford it. There is no alternative to Hermeś but California wine is acceptable for most. Tariffs are not a total miss for Trump and his base. Time will tell on the longer dated items like manufacturing.
Good analysis. One nuance — cost-per-token economics behaves differently at scale. What works at prototype stage often inverts in production.
Wrote about this recently: https://credentials.substack.com/p/the-700-billion-buildout-whos-actually