Pull out of TPP and watch the jobs go overseas: First up Harley Davidson

[grantcart]

In this timely thread Union Leaders complain about jobs moving from the US to Thailand.

https://www.democraticunderground.com/100210610419

Sounds like just another company moving to cut costs, but it isn't. It is an American company desperately trying to maintain its market now that the US will be out of the TPP.

Before leaving the TPP it was expected that the US factories would be able to compete and export HD bikes to Asia, now they will be made in Asia. Guess what? Even IF the Idiot in Chief does to back to TPP and even IF they let the US back in, those HD jobs will not be returning, they are gone and gone forever, the TPP was the last chance to save those kinds of jobs.

The best peer review article on the TPP estimated that by the year 2030 the TPP would add about $ 140 billion to American incomes. The reason is simple: we exchange better penetration of US jobs that are based on higher capital, higher skill, higher tech and less fungible to give TPP countries better access to the US for jobs that are lower capital, lower skill, lower tech and highly fungible. That study below but first what happened to Harley Davidson:

https://rideapart.com/articles/harleys-thailand-factory-result-pulling-tpp

Of course, selling American bikes in the APAC market—more specifically in Southeast Asia—comes with what Levatich has described as “unbelievable trade and tariff barriers". Because of the fee tacked on for importing a motorcycle from the US, it is cheaper for Harley to setup a factory in Thailand and build bikes there rather than build them here and send them there.

“We would rather not make the investment in that facility (Thailand), but that’s what’s necessary to access a very important market,” says Levatich. “It is a direct example of how trade policies could help this company, but we have to get on with our work to grow the business by any means possible, and that’s what we’re doing.”

On a macro scale the impact of TPP would have been significant to the US who would have been the biggest beneficiary:

https://piie.com/publications/working-papers/economic-effects-trans-pacific-partnership-new-estimates

The new estimates suggest that the TPP will increase annual real incomes in the United States by $131 billion, or 0.5 percent of GDP, and annual exports by $357 billion, or 9.1 percent of exports, over baseline projections by 2030, when the agreement is nearly fully implemented. Annual income gains by 2030 will be $492 billion for the world. While the United States will be the largest beneficiary of the TPP in absolute terms, the agreement will generate substantial gains for Japan, Malaysia, and Vietnam as well, and solid benefits for other members. The agreement will raise US wages but is not projected to change US employment levels; it will slightly increase "job churn" (movements of jobs between firms) and impose adjustment costs on some workers.

International trade is a highly complex organism and a lot of it is not ideological. The greatest sin of the populist nationalist, in this case Idiot in Chief, is to implement policies that fit on a bumper sticker but actually will have a counter affect to its intention.

US tariffs on Chinese steel and aluminum were made with the enthusiastic embrace of steel and aluminum manufacturers and their unions and it made for one of Trump's best photo ops. Last time we tried this it cost us a net loss of over 100,000 jobs and that is why Cohen left as economic advisor. The premise that China is a major disrupter in steel and aluminum is not only not true its laughable.

The major exporter of steel and aluminum to the US is Canada which has higher structural costs (like taxes) than the US.

http://www.latimes.com/business/la-fi-canada-trump-tariffs-20180303-story.html

Canadians reacted with a mixture of anger, confusion and resignation this week to President Trump's promise to hit U.S. imports of steel and aluminum with hefty tariffs, upending decades of economic cooperation and integration.

"We're pretty consistently flabbergasted that Canada is at the top of the hit parade of trade villains" in Trump's eyes, said Douglas Porter, chief economist at the Bank of Montreal.

Under the Trump policies announced Thursday, steel imported into the United States would be slapped with a 25% tariff and aluminum with a 10% tariff. The announcement sent shudders through world markets and prompted a global outcry, with European allies and others threatening retaliation.

Trump often has accused China of forcing U.S. steel and aluminum companies to fold by inundating the market with cheaper materials. But Canada is the largest exporter of steel and aluminum to the United States, supplying $7.2 billion of aluminum and $4.3 billion of steel to the United States last year.

Compare the announcement of the Idiot in Chief and the bad effects of leaving the TPP with the following article which is based on the US being in the TPP and having a really smart guy as President

https://www.reuters.com/article/us-vietjet-boeing/vietnams-vietjet-to-buy-100-boeing-planes-for-11-3-billion-idUSKCN0YE0C1
The deal, signed during U.S. president Barack Obama’s visit to Vietnam, represents a coup for Boeing, as VietJet has only operated its European rival Airbus’ A320 airplanes since it began operations in December 2011.

The airline also signed a $3.04-billion deal for engines made by Pratt & Whitney, a unit of United Technologies, for the 63 Airbus planes of the 99 it ordered and 7 hired since 2013.

This is the difference between an intelligent leader and an idiot, the difference between long term policy and a bumper sticker slogan.

For every year Trump is in office it will take five years to recover, and that is based on the assumption that the American people want to change and do the work of reading, understanding and discussing actual policies.