Thursday, April 3, 2025

What about Trump Tariffs?

When a government imposes tariffs, ITS OWN PEOPLE PAY!


Trump's Tariffs


WHAT ABOUT TARIFFS? 

By Professor Gilbert Morris
Nassau, NP, The Bahamas


Trump Tariff
One of our young princes - the artist Sheldon Saint - asked me to explain about tariffs.  And whilst it’s a pleasure to answer one of my beautiful sons of Grand Bahama, it turns out that it’s my job, as my title is “National Public Reader of The Bahamas”; which means in times of crisis, I am to explain the crisis to my fellow Bahamians.

Well, what a silly little ditty this “Liberation Day” has been; a veritable cult of nonsense, on the US imposition of tariffs, even in geographic areas with no people; although birds do fly!


LET’S GET AT THE TECHNICALS: 

So, the administration actually thinks it’s some sort of equation:

1. To create a rate based on each country’s US trade surplus

2. Divided by their US exports!


DC ECONOMICS - a think tank - provided a good basic example:

a. US trade deficit with Indonesia is $17.9 billion

b. Indonesia’s exports to US is $28 billion

c. So: $17.9/$28 = 64%, which Trump claims is the tariff rate Indonesia charges the U.S.

So the Trump administration is using a nation's trade deficit with the U.S., divided by the nation's exports to the U.S.

But that’s not a trade equation…as such the Trump tariff rates are arbitrary and will lead to economic convulsions for Americans as I will show below!


THERE’s ONE MORE TECHNICAL POINT:

1. The Trump administration claims to have assessed tariff and non tariff barriers in calibration to determine the effective tariff rates.

2. That would mean Trump divided the US trade deficit with a country using imports and then multiplied by half; judging by the rates.

3. Part of the reason this is NOT a trade formula is no homogeneous elasticity for those countries on whom 10% across the board has been imposed, instance.

4. Simply, their calculations do not capture the reality of trade and it can’t with dozens of countries treated exactly the same or territories (French ones) treated as countries when their trade is counted already.

5. Moreover, to gain a clearer perspective, they would need some sort of elasticity/time passthrough that dovetails to 1 as a baseline.

6. Nothing in Trump’s calculus captures the elasticity of trade or the range of U.S. dependencies, like potash from Canada.


NOW LET’S GO TO GENERAL EXPLANATIONS:

There are some unimpeachable basics:

1. The imposer of tariffs pays.  For example: In Trump’s previous administration, he had to subsidise the agricultural industry by $34 billion to offset their loses from his bizarre tariff regime.

So let’s be clear:

1. If Americans import an auto from China which costs $50,000 and

2. There is a 50% tariff on that auto…

3. Then the American pays China $50,000 dollars (the cost of the automobile),

4. Then the auto is shipped to America,

5. Then the American must pay the 50% tariff on $50,000 which is $25,000 to the US government.

When a government imposes tariffs, ITS OWN PEOPLE PAY!

Yes it’s like customs’ duty that we - The Bahamas, Jamaica and Barbados (which has one of every tax known to humankind), pay on items;

EXCEPT

A tariff is a penalty and customs duty is a tax.

That is, we aren’t trying to force another country to behave a certain way by using customs duty.

It’s just a lazy unimaginative way to tax citizens.

That’s what we do!

2. ⁠Whilst the imposer of tariffs pays (raising domestic costs, engendering unemployment, collapsing small businesses), those upon whom tariffs are imposed may lose market share or share of sales in whatever products are affected; unless they can diversify demand.

So, in our China example above: when an American buys a product from China and the U.S. imposes a tariff, that item becomes more expensive for Americans or in America.

So imagine you own Dollar Rent-a-Car and you were paying just the $50,000 for each auto to China.  Then the US government adds the 50% tariff, that means for no reason, your cost for each automobile just increased.

10 automobiles would have cost you $500,000 at $50,000 each.  Now suddenly without warning the exact same automobiles cost you $75,000 each or $750,000!

If you are a company - FedEx or rental cars, or limousine service or taxi company - your government just drove your costs upward for no benefit to you!

Now imagine appliances companies, clothing companies, furniture, technology, medical equipment, building supplies…all these companies would experience higher costs, which they must now add to their retail prices and so customers pay the higher costs.

Additionally, if companies can’t pay it, they let employees go so they can stay in business.  This is how tariffs lead to unemployment.  And remember, 70% of all jobs in America are small businesses.

LET’S GET A BIG PICTURE PERSPECTIVE:

3. ⁠The US - 4% of world population but 34% of global consumption - which means that’s hard to replace.  But U.S. borrows 80% of global savings.

Therefore - if you can believe it - it’s placing tariffs on those who finance its consumption!

This is a more complex point:

US debt is over $30 trillion.

So where do they get the money to consume?

They borrow it.

Where from?

From you!

Alright - lil gapseed here - you need to stop lying.  We know you’re not supposed to have US bank accounts without Bahamas Central Bank approval…but we know your lil corruption at Bank of America.  But it turns out 80% of global savers think their money is safe in the United States…as you do!

So the U.S. uses your savings as borrowed money to finance their consumerism.  (It’s more complex than that…but that’s the basics).

The point is: why impose tariffs against countries whose citizens are financing US debt through savings in America?

It shows how interdependent America is and how delusional are these polices.  Because you have those savings owing to more competitive productive environment - Mexico, Vietnam, China, etc - in your country rather than in the U.S... but when you’re paid, you hold your savings there, giving them access to cheap loans.

So what happens to China or Mexico or Vietnam when the tariffs hit their economies?

Well, as I said, they pay nothing.

Americans pay.

But Americans may decide not to buy that Chinese auto because they don’t want to pay $75.000 for an auto that cost them $50,000 yesterday.  That means sales in China, Mexico, Vietnam etc may slow down.  And obviously, if sales slow down, they earn less money.

But this is complex: so for instance, there are some items on which the U.S. can’t hold tariffs for too long or it would destroy industries in America; such as steel and aluminium from Canada or potash also from Canada.  There are critical tech components of life saving medical equipment from China, Vietnam and textiles from Indonesia.  So what will happen is whilst talking loudly, the U.S. would relax tariffs on those items…because US hospitals and national security firms will demand that the US government change the policy to avoid disastrous impacts.

Also, China, Mexico and others could find new customers in other countries; which is the easiest option…whilst waiting out the U.S.!

But, they could also reduce their currency values buy some share the tariff amount.  So if the tariff is 10%, they could reduce their currency value by 5%.  This would absorb the tariff to some degree and make that automobile I mentioned closer to the original $50,000 price and so the tariff would have less of an impact, at least theoretically.

4. ⁠For Caribbeans: just yawn.  This is a piffle.  We should ignore these tariffs: The Bahamas exports around half a billion in goods, some bonded…so about 5% to 7% of GDP.

But since we sell so little to the U.S., you see how stupid it is putting tariffs on us.  In my economics classes, I teach that we are a “loop economy”: that means no matter how much money we earn from the U.S., we go right back and save or spend it in the U.S.  So it’s stupid to put any hurdle on The Bahamas and we are the only country in the world (with Turks and Caicos) where this is so.

For Jamaica and to some degree Guyana, the matter is more complex as they export higher shares of GDP to the U.S.  But even they can offset tariffs quietly and expertly.

The truth is: We do more to damage our economic prospects than Trump’s tariffs can!


Source / Comment

The Bahamas Government Responds to U.S. President, Donald Trump 10% Reciprocal Tariff

U.S. President, Donald Trump 10% Reciprocal Tariff on Caribbean Countries - including The Bahamas




Tariffs USA
The Government of The Bahamas has taken note of the announcement by U.S. President Donald Trump to impose a 10% reciprocal tariff on several Caribbean countries, including The Bahamas, that export duty-free to the United States under the Caribbean Basin Initiative (CBI).  It is important to note that The Bahamas currently maintains a trade deficit with the United States.

We will engage with our U.S. counterparts and work collectively with our CARICOM partners in response to this development.  The Government has approved a National Trade Policy aimed at diversifying trade.

As part of our broader strategy to protect the Bahamian economy, we have already announced a number of measures, including the development of a trade diversification framework.  We remain focused on minimizing the impact of global trade decisions on Bahamian businesses and consumers.


Source

Monday, March 10, 2025

Branville 'The proven snake' McCartney Bombastically Speaks

FNM 'Judas' Branville McCartney Arrogantly Advises The FNM!


Stay out of FNM Business, Mr. Branville McCartney


By Dennis A. Dames
Nassau, The Bahamas


Branville McCartney DNA
Did you hear that foul piece of political ordure which the FNM traitor, Branville McCartney so arrogantly advised to the party - that he so cruelly abandoned?  He had the audacity to gave counsel to the FNM about giving the former party leader Dr. Hubert Minnis a nomination to run in The next general election.

Branville McCartney Bahamas
How politically arrogant could a turncoat become?  No one with sense in the Free National Movement – FNM party takes Branville ‘The proven snake’ McCartney seriously.

His beloved Democratic National Alliance – DNA still exists, but is presently on life support and is only in need of some intense loving boost to live a bit more - to simply add some cash to the public treasury.

DNA Branville McCartney
Go and revive your needy political house, Mr.  McCartney, and invite your cousin – Dr. Hubert Minnis to be its leader.  That way, you and your sweetheart of a coz could get a royal cut-hip to safely propel both of you into the nearest political graveyard – once and for all mon.

Wednesday, March 5, 2025

We Learn from Canada Trudeau Errors in Response to Trump's Tariff Big Stick

Justin Trudeau Errs


CANADA IS RIGHT TO STAND UP; BUT IT MUST LEARN TO ACT WITH STRATEGIC STEALTH!


By Professor Gilbert Morris
Nassau, The Bahamas


Trudeau Errors
Seems unwise that Canada should telegraph its every move against US financial aggression.

If Canada knows - for instance - that 6 million U.S. homes depend on Canadian energy…make the moves necessary to bring that to bear without telegraphing.  Undertake surgical strategies to offset interdependencies, by whatever degree of stealth is possible.

One can’t win a narrative war.

Let Trump awaken to the consequences of his decisions by their actual impacts.

America’s apparent dominance - to speak in such terms - are really a network of teeming interdependencies through which it has been allowed to appear dominant singularly.

That is fragile.

And Canada has been complicit in sustaining American dominance; including choking Cuba to death illegally and financing the slaughter of 50,000 Palestinians.

It’s not enough to whine and claim victimhood.  Canada must in its actions atone for its complicity as handmaiden to serial villainy: for instance, it should end the effectiveness of the Cuban embargo by leveraging its massive agricultural prowess in Cuba; solving their food production and distribution problems.

Such a strategy would not merely help the Cubans, but it would punch a hole in the embargo, whilst providing regional states - which have also been complicit - with alternative access to agriculture.

Things how one break those interdependent linkages, expose fragilities and system anomalies which are weaknesses appearing as strategy’s, by enacting counter-measures against key US industries, rather than against the U.S. itself…and beyond mere talk and showboating.

It strikes harder and more deeply and in that way, does so in a manner that’s difficult to incite revenge.

Small nations must master such methods!


Source / Comments

Thursday, February 13, 2025

Trump Bans Central Bank Digital Currencies (CBDCs) in The United States

Donald Trump Central Bank Digital Currencies (CBDCs) ban order defines CBDCs as digital money denominated in the national currency and directly issued by the central bank...


Central bank digital currencies - CBDCs are completely owned and controlled by governments.  Meaning governments would hold your wallet, your money, and have access to all of your banking information.  This would include information on every transaction in your daily life.  It’s ultimate centralization


By Collective Evolution:

central bank digital currencies (CBDCs) ban
President Donald Trump signed an executive order this year banning the creation and issuance of central bank digital currencies (CBDCs) in the United States.  The order defines CBDCs as digital money denominated in the national currency and directly issued by the central bank.  It prohibits any federal agency from developing, promoting, or implementing plans related to CBDCs unless required by law.  Any ongoing initiatives must be immediately terminated.

CBDCs are completely owned and controlled by governments.  Meaning governments would hold your wallet, your money, and have access to all of your banking information.  This would include information on every transaction in your daily life.  It’s ultimate centralization.

With cryptocurrencies, governments can’t track how much you have, where you spend your money, or who you give it to.  Plus they are decentralized, effectively pulling power away from central banks who have been using debt to control and enslave entire populations for decades.

With CBDCs, something governments and central banks have been pushing hard for, governments would enjoy more secrecy, and be able to control their population more than they currently do.  CBDCs would also be easier to tax, since hiding any money from the government would be impossible.

Remember, central banks ARE the problem, and have been for decades.  Crypto was created to stop this problem, yet they have gotten a bad rep because they don’t serve the interests of powerful people.

"Instead, a CBDC is something closer to being a perversion of cryptocurrency, or at least of the founding principles and protocols of cryptocurrency—a cryptofascist currency, an evil twin entered into the ledgers on Opposite Day, expressly designed to deny its users the basic ownership of their money and to install the State at the mediating center of every transaction." - Edward Snowden.

Source / Comment


Blogger Note: Say bye-bye to Central Bank Digital Currencies (CBDCs) and welcome to the new world of crypto currencies - Bahamas!

Tuesday, February 4, 2025

Hubert Minnis All In Political Game

The Lost Cause of Hubert Minnis


By Dennis A. Dames
Nassau, The Bahamas


Dr. Hubert Minnis
This is an open letter to The Most Honourable, Dr. Hubert A. Minnis, MP, Killarney Constituency.


Dr. Minnis, you were the leader of the FNM for the 2017 general election.  Under your watch, Mr.

Edison Key Abaco
Edison Key – an FNM incumbent, was heartlessly undercut and denied a FNM party nomination to run in the 2017 elections.  You were the leader then – remember?

Now, you and your supporters say you should be given the chance to run again, just because you are a FNM party incumbent candidate.  Well bro, what’s good for the goose is good for the gander.

Wednesday, January 22, 2025

Hubert Minnis Losing Game

Hubert Minnis is Set to Burn Down the Free National Movement - FNM before the Next General Election in The Bahamas


Dr. Hubert Minnis Phantasm of Becoming Prime Minister of The Bahamas Again


By Dennis A. Dames
Nassau The Bahamas


Dr. Hubert Alexander Minnis is all set to sadly divide the the Free National Movement - FNM leading up to the next general election.  It seems as if he does not mind ruling over a party of utter ashes - of which he is about to instigate through his arrogant and selfish drive to become the lousy leader of the Free National Movement - FNM once more.

Yes, he is arrogantly on a losing course to wreck the FNM – just to satisfy his wicked political ego.  Well, he will holler as the FNM will not win the next election under his unwanted national leadership.

He is unknowingly working on a political legacy of shame and disgrace for himself.  He is a sore loser.

As a voter in the Killarney constituency – who has supported the FNM all of my voting life, I am all ready and set to ensure that Dr. Hubert Alexander Minnis lose his seat on or before 2026.  So, carry on Dr.  Minnis.  Your time of becoming a no-seat wonder nears with the passing of each day.  It will be a fitting retirement gift for the politically foolish Dr. Minnis – who appears not to know when to quit while he is ahead.