Schiff on Free Trade?

[I've had enough]

I'm sorry if this has been discussed on here before, I've recently joined.

What are Schiff's thoughts on our current trade system?

I'm having trouble forming an opinion about the issue and I'd appreciate the information.

Thanks.

[krazy kaju]

Schiff is pro free trade. He points out how overregulation, overtaxation, and easy money is at the root cause of the USA's trade deficit.

The free market balances trade because an outflow of currency but equal the inflow of currency out of a region. If, for example, the US buys $300 million of goods from China, then China has an extra $300 million in their coffers. That $300 million means a higher purchasing power, higher wages, and greater profits, enabling the Chinese to buy extra goods, including goods from the USA. At the same time, that deficit of $300 million causes slight deflation. Lower demand in the USA but higher demand from China means that the Chinese will be able to buy more American goods. Thus, trade balances out.

However, in a market tampered by a central bank, like the Federal Reserve, the outflow of currency doesn't necessarily lead to an equal inflow of currency. When a central bank devalues its nation's currency, it prevents the natural process of deflation in a country with trade deficits. This prevents the trading partners of that said nation from having greater purchasing power, thereby destroying their ability to purchase the goods of that nation. This promotes ever greater trade deficits.

Moreover, regulations also drive jobs out of the United States. It is easier to start, operate, and close a business in all Scandinavian countries, Ireland, Canada, and a few others.

Taxes also drive jobs out of the United States. Countries like Mexico, Canada, Germany, Japan, and South Korea all have lower corporate taxes than the United States. This encourages job creation in those countries, while discouraging it in the US.

[Epic]

You can't argue for freedom if you don't believe in people's freedom to make transactions...

[sratiug]

You can't argue for freedom if you don't believe in people's freedom to make transactions...

But free trade within the US is more important than free trade outside. All internal federal taxes subsidize imports. Replacing internal federal taxes with a flat tariff would ensure the free-est trade possible given our expenditures on federal government. Jefferson relied on the tariff for revenue.

[I've had enough]

Schiff is pro free trade. He points out how overregulation, overtaxation, and easy money is at the root cause of the USA's trade deficit.

The free market balances trade because an outflow of currency but equal the inflow of currency out of a region. If, for example, the US buys $300 million of goods from China, then China has an extra $300 million in their coffers. That $300 million means a higher purchasing power, higher wages, and greater profits, enabling the Chinese to buy extra goods, including goods from the USA. At the same time, that deficit of $300 million causes slight deflation. Lower demand in the USA but higher demand from China means that the Chinese will be able to buy more American goods. Thus, trade balances out.

However, in a market tampered by a central bank, like the Federal Reserve, the outflow of currency doesn't necessarily lead to an equal inflow of currency. When a central bank devalues its nation's currency, it prevents the natural process of deflation in a country with trade deficits. This prevents the trading partners of that said nation from having greater purchasing power, thereby destroying their ability to purchase the goods of that nation. This promotes ever greater trade deficits.
.

Thanks. How come, after nearly 3 years of college with 3 econ classes and several business classes, has no one ever explained this to me?

[Epic]

But free trade within the US is more important than free trade outside. All internal federal taxes subsidize imports. Replacing internal federal taxes with a flat tariff would ensure the free-est trade possible given our expenditures on federal government. Jefferson relied on the tariff for revenue.

Right but that's looking at it from a political pov. Free trade vs. Protectionism is really an economic/intellectual argument. Ron Paul would like to just have a low uniform tariff, but he's the biggest free-trader there is from an economic pov.

[He Who Pawns]

Thanks. How come, after nearly 3 years of college with 3 econ classes and several business classes, has no one ever explained this to me?

Exactly. Papa Schiff, may he be freed from jail soon, put out this comic book aimed at teaching basic economics to youngsters, but actually, I learned more from that comic book than from all my high school and university econ classes!!

[krazy kaju]

But free trade within the US is more important than free trade outside. All internal federal taxes subsidize imports. Replacing internal federal taxes with a flat tariff would ensure the free-est trade possible given our expenditures on federal government. Jefferson relied on the tariff for revenue.

I agree. We would actually make trade a lot freer if we removed all quotas and tariffs and replaced them with an across the board two or three percent tariff.

[Calpico]

Did he do the art for the comic himself?

[He Who Pawns]

No, I doubt it.