Can Trumps economic plan work?

[Benton]

(01-10-2017, 02:30 AM)hollodero Wrote: Interesting post, sorry for only adressing that last part. This might be an interesting question - what are american workers willing to accept. I know of some examples back in Europe. A big manufacturer (I want to say VW, but not sure anymore) once told their personnel point blank, listen, you either take a paycut and forgo some of the benefits you would be entitled to, or we move to whereever and you're unemployed. And people ate it up. In a glazier's workshop in my home town I shortly worked in (never do that, btw.) the staff was also told, accept a massive paycut or Slovakians are more than willing to take your job for even less pay. And some ate that up, too (although there were mainly Slovakians when I was there, so probably not all of them did). These are frightening examples somehow. 
How desperate are people?
These instances happened in welfare states, where unemployment isn't an immediate existential threat. The US worker might be even more susceptible to blackmail of that kind - even regarding "returning" jobs. That's one of the questions things might boil down to - not only whether jobs go back to the US, but what kind of jobs those would be. I guess most Americans don't want to do a Mexican's work for a Mexican's pay - but they might feel forced to do so. Minimum wage is not likely to happen under the GOP, so there really is little limit to that apart from the worker's unwillingness to accept low wages. And how are those people percieved then. Here it's "freeloaders" and that's the end of the discussion.

Now additionally, your unemployment rate is way below that in Europe - but Detroit et al. sure are exceptions. I don't know what Detroit residents are willing to take. But if companies go back there, it might not lead to increased wealth, but to some kind of inner-state favela city where people just make enough to somehow survive. That I think is not that unrealistic.

Now in addition to tariffs - will the domestic market really be sufficient for the manufactured products? For one thing is quite clear. When you imply tariffs, it will be a double-edged sword, there will be a counterreaction. For countries like China or India - where a huge population might be on the leap to becoming wealthy and hence be a huge future market for more expensive imported goods - won't be that accessible for US products and therefore be widely lost for US companies. And I wonder if the US really is fit and willing to accept a more self-sufficient lifestyle. Tariffs might lead to being more excluded from world economy - hence resulting in a drastic loss of overall wealth. Which might mostly affect the average population, say the middle and lower class. This I see as a problem within the good news from the automobile manufacturers - which are evidently a Trump success as of now, even I have to somehow admit that at this point.

Just thoughts - I don't really know about these things. Basically just a worker myself.

To the first part, it depends. We had a steel mill close down over the summer. The union tried to negotiate reduced wages, but the parent company (German I think) wasn't interested.

The flip side of that is when companies like Hostess. Back when we had Twinkiegeddon, the CEO of Hostess was quick to point out that workers refused to take another pay cut (they'd already accepted reduced wages and decreased benefits to keep the doors open). The union moved forward with a strike because during that same time, the CEO got a 300% pay raise and most of the upper management got significant pay increases as well.

I think the majority of US workers will accept a little less if they see the company (ie, management) is sacrificing, too. But if you you go from making $20k a day to $50k or $60k, a day you're not going to get a lot of support for asking your employees to got from $40k a year to $35k.

As far as the tariffs and effect on other markets, don't know. But it's doubtful it will have a huge impact.

Using India, a quick search had a Toyota Corolla going for about the same in India as it does in the U.S. (just under $20k or 1,493,491 rupees). They're going to sell more Corolla's here than India (according to one web site, it's about 7 times more right now). If US made goods cost more, they're still going to sell more because US workers still make more.