Tactics and Tariffs

The Genius Behind The Trump Tariffs

We export Government Debt. "Junk" is sold to US consumers for dollars and Junk (dollar-denominated Treasury Debt) is bought by foreigners. Incumbent -- and often incompetent -- politicians can spend money to keep their supporters happy without raising taxes. If the dollar were backed by gold, we would have run out of gold (and imports) in the 1960s. But then we could not have fought the Vietnam War and built LBJ's not-so-Great Society.

The dollar is now backed by American assets (such as real estate -- when they sell our debt, they can buy our houses). We sacrificed our industries to re-elect politicians and benefit Wall Street, Silicon Valley, and the Wealthy Everywhere. Next, we'll sacrifice our homes. We need to get spending under control.

The President should announce a trade deficit target. The deficit was $1.2 trillion last year, so put it at $800 billion this year, $400 billion the year after, and a max of 200 billion every year after that. Impose penalty tariffs for each year a nation sells 10 percent more than it buys. The more goods a country buys from the US, the more it can sell in return.