On Jan 30, 2012, at 4:14 PM, brad wrote:
> A Competitive Dollar: The Missing Link in President Obama’s
> Manufacturing Agenda
> Dean Baker
> Truthout, January 30, 2012
Lots of blah blah blah but not a word suggesting *how* the dollar is to be devalued, since flooding the banks with zero-interest credit and bellowing furiously at the Chinese have achieved less than nothing (given the $'s appreciation against the euro).
So why does nobody dare talk about the one obvious way to restore competitiveness to US manufacturing--change the tax structure by imposing an across-the-board twenty percent customs duty on merchandise imports (raising some $.4 trillion) and using the revenue to cut or eliminate the payroll tax?
Of course the orthodox will yell "free trade," "protectionism," "beggar thy neighbor" "Smoot-Hawley" and any other scare words they can think of.
But a revenue-only tax is not protectionist because it discriminates in favor of no industry, leaving importers and consumers perfectly free to spend on whatever imports they desire. Moreover it would enable the removal of all the *really* protectionist subsidies and "buy American" requirements that clutter up so much of the economy, leaving international trade much freer than at present while saving huge amounts of anti-productive government expenditures and regulations.
And what could be of greater benefit to the rest of the world (especially those poor countries whose finances depend on remittances from guest workers) than a vigorously expanding US economy?
Would it violate international trade treaties? It could not possibly do so, because the US constitution specifies customs duties as a main source of government revenue. Therefore if a treaty were to be construed as prohibiting using customs duties to raise revenue that would make it flat-out unconstitutional and so entirely null and void.
So why are the most "heretical" voices on our "left" and "right" (the Dean Bakers and Ron Pauls) so terrified of this simple proposition that they seem incapable of even letting it cross their minds? Only the Manchesterian Gods can guess.
Shane Mage
This cosmos did none of gods or men make, but it
always was and is and shall be: an everlasting fire,
kindling in measures and going out in measures."
Herakleitos of Ephesos