Friday, June 14, 2019
Michael Hudson: Trump's trade tantrum is that other countries are simply following the same economic strategy that once made America great, but which neoliberals have destroyed here and in much of Europe. U.S. negotiators are unwilling to acknowledge that the United States has lost its competitive industrial advantage and become a high-cost rentier economy. US GDP is "empty," consisting mainly of the Finance, Insurance and Real Estate (FIRE) rents, profits and capital gains while the nation's infrastructure decays and its labor is reduced to a part-time "gig" economy. Under these conditions the effect of trade threats can only be to speed up the drive by other countries to become economically self-reliant.
Trump opens negotiations with a threat. That costs nothing, and you never know (or at least, he never knows) whether he can get a freebee. One might even think this tactic worked against Mexico, but that is just another deliberate lie from the orange sloth. In fact the agreements between the USA and Mexico to install more troops at the Mexico's Southern border and house refugees applying for asylum in the USA in Mexico was signed last December.
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