I am glad to see Dr. Roth supports constitutional government and free enterprise in theory. I would like to see him support it in practice.
He rejects that the Trade Promotion Act as unconstitutional because the courts have not yet ruled it so. But constitutional government is not the sole job of the courts.
Congress should not pass unconstitutional laws, the president should not sign unconstitutional laws or execute unconstitutional laws. The people should not elect officials that violate the constitution. Elected officials take an oath to uphold the constitution. They can try to change the constitution, but until they do, they are bound by it.
The need for Congress to pass tax laws is an important part of our system. Just as the 2nd amendment prevents the government from having a monopoly of force, the taxation clause prevents any individual in the government from having the sole discretion to set taxes. This is power too important to delegate to the President.
As for the tariffs as policy, Dr. Roth argues, that tariffs are justifiable because the Chinese government is evil; because trade hurts American workers, because foreign investment is bad and because trade with China is only a minor part of the economy.
The evil nature of President Xi’s government is undeniable. But is hard to see how raising taxes on Americans help the people of China or weakens the grip of President Xi. And why tariffs on China OK but not other tyrannical governments.
As Dr. Roth is familiar with the greater efficiency of free trade, the argument that we should have tariffs to help some Americans at the expense of the majority of Americans is odd. The “rust belt” was not created primarily by foreign trade.
Urban factories were uncompetitive due to improvements in transportation (Interstate highways & containerization) which allowed factories to move to cheap land away from the old cities, as well automation reducing the need for workers and factories moving to the American South due to lower wages.
Most cities were able to reinvent themselves as service providers in the global economy. The majority of Americans ended up better off.
Let’s not forget that not all of Trump’s tax increases have been about China. His tariffs on steel, hurt the American auto industry.
Is a steelworker’s job worth more than an autoworker’s job? Or two autoworkers’ jobs? (Economists found the job losses in the auto industry exceed jobs saved in steel) Conservatives used to say that it is not the job of the government to pick winners or losers.
Dr. Roth’s concern about foreign investment seems misplaced. Why should have Dubai Ports World, a reputable firm based in a friendly country be barred from investing in the US? Why are “Arabs” unacceptable as investors?
In any case, most foreign investment involves buying U.S. government securities, thereby financing our increasing deficit, the highest since 2012, almost double the deficit in Obama’s last year. Without a trade deficit, we would be facing much higher interest rates.
Dr. Roth, also stated that trade with China is only 5 percent of our economy, so it is not important. Five percent of our economy is more than a trillion dollars a year? That is twice as much as drop in our GDP during 2008-2009 recession.
As I write this, Donald Trump says he has reached an agreement with China that they will purchase more agricultural products in return for Trump not raising taxes again. Please forgive me for not being grateful to Donald Trump on this.
Roger Cooper
Albertson
