Raymond Richman - Jesse Richman - Howard Richman
Richmans' Trade and Taxes Blog
The Trade Agreements Negotiated by the U.S. Have Been a Disaster for U.S. Workers. and the U.S. Economy
In seeking a Trans-Pacific free trade agreement, the U.S. is continuing a policy of seeking international trade agreements in spite of the fact that all of the agreements it negotiated since 1966 have converted the U.S. from the world's leading creditor nation to the world to the world’s leading debtor nation. In 1947, the U.S. began negotiations seeking an international General Agreement on Tariffs and Trade (GATT). There were eight rounds of negotiation from 1947 to 1994. They had little effect on the U.S. trade balance until the Kennedy round, 1964-1966. The trade deficits exploded after the Uruguay round. 1986-1993, in which 123 nations participated and which created the World Trade Organization (WTO) which began operations in 1995. The creation of the WTO marked the beginning of the end of the USA as the world’s leading industrial power. The North American free Trade Agreement (NAFTA) with Mexico and Canada in 1993, the granting of permanent most-favored-nation trade status to China in 1980, the free trade agreement with Korea, all produced large trade deficits and cost millions of American jobs. These agreements led to a major exodus of U.S. manufacturing firms overseas.
The US ran a trade surplus in 1981 of $3.1 billion. By 1983, the US experienced a trade deficit of $35.1 billion. By the end of the Uruguay round, 1983-1994, and the creation of the WTO in 1995, the U.S. trade deficit had grown to $105.3 billion. The trade deficit peaked in 2006 at over $800 billion and in 2014 it amounted to $467.6 billion. ...
Michelle Malkin: U.S. harmonizes its patent laws with Europe
In preparation for the Obamatrade deal with Europe, the United States has adopted Europe's anti-innovation patent laws. Michelle Malkin is on the story. She writes:
America's patent laws have been moving in this direction for years, due to foolish decisions by the DC federal court. More and more, patents are being filed, not by those who are developing new inventions, but by those who wish to sue those who eventually develop the new inventions.
Inventors should, at the very least, be forced to produce working prototypes of their invention before they can apply for patents. I would like to see a much tougher patent process in place, but also one which includes automatic grants to produce the invention whenever a patent is awarded.
Which American President Holds a Patent?
By the way, Malkin includes a fun fact in her article. She writes:...
Sen Sessions explains Obamatrade in key Senate Speech -- I was published in the American Thinker blog
I closely followed the Senate debates on Trade Promotion Authority (Fast Track), and afterwards posted an American Thinker blog piece that has received about 300 comments, almost all positive. I began:
If you want to read the rest, go to:
U.S. Trade Agreements Have Been an Economic Disaster for American Workers
In 1947, the U.S. began negotiations to seek an international General Agreement on Tariffs and Trade (GATT). There were eight rounds of negotiation from 1947 to 1994. The Tokyo round which began in 1973 and lasted for more than six years was attended by 102 nations. The last round began in Uruguay in September, 1986 and 123 nations participated and ended with the creation of the World Trade Organization (WTO) in 1995. GATT marked the beginning of the end of the USA as the world’s leading industrial power.
GATT was followed by the granting of “most favored nation” status to China in 2000. In a 2012 article by Justin R. Pierce, a Federal Reserve Board researcher, and Yale economist Peter K. Schott, found a link between the sharp drop in U.S. manufacturing employment after 2001 and the elimination of trade policy uncertainty resulting from the U.S. granting of permanent normal trade relations to China.
When one examines the history of the US trade balance, it appears that until the end of the Tokyo round which lasted from 1973 to 1979, the US ran small trade surpluses with the rest of the world. The US trade surplus in 1981 was $3.1 billion. In 1983, the US experienced a trade deficit of $35.1 billion. By the end of the Uruguay round, 1983-1994, and the creation of the WTO in 1995,.the U.S. trade deficit had grown to $105.3 billion.
Tomorrow's vote on the Portman-Stebanow amendment to Fast Track is shaping up as the only significant amendment that could pass. It would direct the U.S. Trade negotiator to include prohibitions against currency manipulation in the trade treaties that Obama negotiates. The Hill reports:...
This Amendment would Preserve U.S. Sovereignty from Fast Track
This week, the U.S. Senate will be considering up to 100 amendments to the Fast Track bill, which is expected to pass the Senate on Friday. Senator Elizabeth Warren and twelve other Democratic senators are sponsoring what could be the key amendment (pdf) for preserving U.S. sovereignty. Here is the text:
At issue are the Investor-State Dispute Settlement provisions that are in Obama-type trade agreements. If any existing U.S. law or regulation violates the agreement, foreign businesses can sue the U.S. government for monetary damages. Through billion dollar fines, the dispute arbitrators can force Congress to change any U.S. law that differs from the trade pact.
Like Senator Warren, Republican Senator Jeff Sessions wants to preserve U.S. sovereignty. On May 12 he issued a Critical Alert in which he wrote:...
Fast Tracking the End of U.S. Sovereignty
Now President Obama is selling Obamatrade and has come up with a new lie. On May 8, 2015, he told an audience in Beaverton Oregon:
But Congress’ think tank has found that the Trans-Pacific Partnership (TPP), the first of the trade agreements that Obama is negotiating, would indeed change U.S. laws. Senator Jeff Sessions reports:
What is President Obama negotiating into TPP? The following all appear to be likely:...
Jeff Sessions May 12 alert about FastTrack
Senator Jeff Sessions of Alabama definitely gets it. His May 12 critical alert is excellent. Here's how he begins:...
Solving the Capital Gains Riddle
Under the U.S. personal and corporate income tax codes, realized capital gains and losses are considered income. However, when calculating national income, capital gains and losses are excluded. Why the difference in treatment? No serious economist would argue that changes in the value of assets during a period should be added in calculating the national income for that period. Nor even that realized capital gains and losses should be added in calculating national income. Yet most appear to believe that realized capital gains at least should be counted as income for purposes of personal and corporate income taxation. Some argue that to exclude realized capital gains would be unfair to taxpayers whose income comes from other sources. In this view, even unrealized capital gains (referred to in the economic literature as accrued capital gains) are income but need to be excluded for administrative reasons, i.e., one should not be forced to sell some of his capital to pay the tax liability. Herein we argue that accrued capital gains are not income, that realized capital gains are income if they are consumed but not income if they are re-invested.
As distinguished an economist as the late Herbert Stein, former chairman of the Council of Economic Advisors, in an op-ed piece in the Wall Street Journal, "Don't Cry for Capital Gains Taxpayers" (WSJ, July 5, 1995), wrote:
Because of the value of time, the tax on capital gains is lower than it seems--and lower than the tax on many other [sic!] kinds of capital income. That is due to the deferral of the tax on the gain from the time the gain accrues to the time the gain is realized by sale or exchange.
When he writes that an accrued gain is a form of capital income, he is confusing capital and income.
Cruz files amendment to prevent Fast Track from changing federal immigration law
When Fast-Track is voted upon, Senator Ted Cruz plans to propose an amendment that would prevent Obama from using Fast-Track power to change federal immigration law. A Texas newspaper reports:
Fast Tracking an International EPA -- we were published in the American Thinker today
After documenting that the Trans Pacific Partnership treaty (TPP) would create a new level of international environmental regulation enforced by a private court system, we point out that Balanced Trade is a much better alternative:
Follow the following link to read the rest:
Senator Elizabeth Warren of Massachusetts gets credit for this one. She led the Democratic Senators in a rebellion. Previously, they had backed everything that Obama had sent down the pike. All but one of the Democrats voted against the bill.
One of the issues was the sports shoe contest. The Bangor Daily News explains:
Meanwhile, Senator McConnell was reluctant to compromise with Democrats on the procedural vote, possibly because he would be losing his own Senators on the votes to follow. If he had continued, five had already announced that they were planning to oppose Fast-Track, including Mike Lee two days ago and Rand Paul today. And others were wavering including Sen. Collins of Maine, who was careful to point out in her comments afterward that her vote did not mean that she favored Fast Track:...
CNN quickly cuts away from Japanese leader saying that Fast-Track will enable free flow of people
At his April 28 Press Conference with Obama, Prime Minister Shinzo Abe of Japan confirmed that the Trans Pacific Partnership, the secret treaty that he is negotiating with Obama, is designed to enable the free flow of people among the 12 participating countries (which include both Mexico and the United States). You can watch this statement at the 47:06 mark. He says (according to the simultaneous translation):
Watch this humorous YouTube video from Redacted Tonight to see CNN instantly cutting away before its viewers could hear Abe's statement:
The amendment to FastTrack that could save America
Tomorrow, the Senate will start voting on whether or not to give President Obama Fast-Track power (Trade Promotion Authority). As my father, son and I noted in a commentary last week (Fast Tracking America's Economic Destruction), the Trans Pacific Partnership will give our treaty partners permission to manipulate exchange rates.
Even worse, the court system in TPA would make it impossible for the United States to ever combat currency manipulation because, if the United States were to promulgate tariffs against a currency-manipulating treaty country, businesses exporting to the United States from that country could sue the U.S. government for billions of dollars of damages in TPP's private court system. We wrote:
Here is the text of the simple amendment that would give future presidents the ability to balance trade. It should be added to all trade treaties that are negotiated by the U.S. government:...
Globalization and Free trade Agreements Set the U.S. on the Road .to Decline
George Washington in his farewell address urged the US to avoid foreign entanglements. How right he was. US foreign entanglements began with a vengeance under Pres. Franklin D Roosevelt beginning with the Bretton Woods agreements (1944) which created the World Bank and the International Monetary Fund.These agreements were negotiated by Harry Dexter White on behalf of the US. (White was later exposed as a Communist spy.)
Benn Steil (senior fellow and director of international economics at the Council on Foreign Relations and founding editor of International Finance) in his book The Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White, and the Making of a New World Order (Council on Foreign Relations, Princeton University Press, 2013), he discusses the creation at Bretton Woods of the World Bank and the IMF. He writes:
Donald Trump's radio ad on fast-track
Does trading away our future buy the US friends?
Writing on May 3 in the Washington Post, the often thoughtful and perceptive Robert J. Samuelson made a fall-back argument for the Trans Pacific Partnership: it's good politics, even if the economics are lousy. The fall back is a weak position, however. Is it truly good politics in the long run to pursue imbalanced trade policies that undermine U.S. power?
Samuelson notes that the economic benefits of the deal would be extremely modest: "Still, plausible economic gains from expanded trade seem modest. By 2025, the incomes of the 12 countries could increase by 0.9 percent, according to a revised estimate by a study for the Peterson Institute." He appears to assume that these will be divided equally though if current patterns hold and U.S. trade deficits with partnership nations grow substantially, the benefits will likely not flow to the U.S. much at all.
But he argues that US trade policy isn't about economics: it's about politics. "Still, the pursuit of political ends by economic means remains at the core of U.S. trade policy." ...
Huckabee campaigning in Iowa: "The last time we fast-tracked something was Obamacare."
Governor Huckabee has been campaigning in Iowa, making Fast Track one of his issues:
Dick Morris wrote today about Huckabee's strategy:...
Dick Morris: Obama Could use Fast-Track to Require Climate Change Regulation
In a May 4 commentary (GOP: Lost Its Soul or Just Its Mind?), Dick Morris warns that President Obama could use Fast Track power (to negotiate trade treaties without amendment) to require climate change regulation:
Bobby Jindal opposes Fast-Track
The Presidential candidates are reading the polls and listening to the voters. On May 1, Gov. Bobby Jindal said:
Michael Savage comes out against "Trade Treason"
Talk show host Michael Savage came out against giving President Obama Fast-Track power. Click here to listen to his show. He begins talking about the trade deal at the 03:44 mark:
Gov. Huckabee decries "unbalanced trade deals" in Presidential announcement speech
You can listen to the following statement at the 9:44 mark:
I would love to hear a candidate say that he would balance trade, since doing so would help restore America's economic health. This is close.
Foreign corporations on the scaffold in China
Vladimir Lenin reportedly said, "The capitalists will sell us the rope with which we will hang them." The Washington Post reported on April 24 (The Great Unraveling of Globalization) that American corporations are now on the scaffold in China:
We put this in context on pages 78 and 79 of our 2008 book, Trading Away Our Future:...
Senator Jeff Sessions issues Critical Alert against Fast Track
Senator Jeff Sessions was one of the Republicans heroes who voted in the Senate Finance Committee to include a prohibition against currency manipulation in the Trans Pacific Partnership treaty that President Obama is now negotiating with 11 Pacific Rim countries. Unfortunately, the amendment that he supported did not pass in committee.
As a result, President Obama was directed by the Senate Finance Committee to negotiate a treaty with 11 countries that would be "free trade" in name only. Our trading partners would be given implicit permission to manipulate exchange rates in order to give their products hidden subsidies and American products hidden tariffs.
But that was just a committee vote. The Senate as a whole has not voted to give Obama "Fast Track" power, called Trade Promotion Authority (TPA), to negotiate trade treaties without the possibility of Congressional amendment. On Sunday night, Sessions issued a "Critical Alert," listing his Top Five Concerns with Trade Promotion Authority:...
Fast Tracking America's Economic Destruction - We're published in today's American Thinker
We're published in today's American Thinker. Here's a selection:
To read the rest go to:
Journal of Economic Literature:
Atlantic Economic Journal: