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We don’t need more dollars in health care. We need less government.

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Following a good showing on his first overseas trip, President Trump returned to the states and called for something that has some on the right scratching their heads. He’s wanting more dollars put towards health care.

One of the things that got the AHCA passed in the House was the decrease in spending on health care. The conservative Freedom Caucus pushed for several additions before voting for it, including the ability for states to opt-out of some of the more liberal points such as pre-existing conditions. However, the reason some gave for finally backing the bill is that it reduces overall spending on health care. What is the President asking for now?

Regardless of whether this was just a Tweet that can be disregarded as rhetoric in 140-characters-or-less or if its a sign that he really wants more money put into health care, the overarching theme is the same. Many in the GOP (and pretty much every Democrat), including the President, are missing the fundamental point that health care can only truly be fixed if the federal government systematically removes itself from the equation.

Obamacare isn’t failing because of subtle details or nuances. It’s failing because the concept behind government-mandated health care is fatally flawed. The differences between the ACA and the AHCA are so small that their cores are essentially the same. Both insert DC into an area where it simply doesn’t belong. By doing so, either will fail whether it has the letter (R) or (D) on its stamp of approval.

We don’t need more money plugged into health care. We need the massive amounts of money that are already pumped into health care focused by a consumer-driven free market. Businesses operate based upon the demands of three forces: government, consumers, and market conditions. Today, government has primacy in the equation by forcing the other two factors to be secondary. Consumers have very little impact in the equation because of mandates in both Obamacare and the current Trumpcare replacement being worked on in the Senate. As for market conditions, they are artificial because of government intervention. They will continue to be artificial if Obamacare is repealed and replaced with a variation of the AHCA.

Nearly everyone on Capitol Hill fears a full repeal for the same basic reason. They know that if it’s done right, it will work in the long term. The Democrats don’t want that because it exposes the long-con they’ve been working in DC for decades, the concept that more government is better. The Republicans don’t want that because they fear it won’t work quickly enough for them to retain power in the midterm elections. The AHCA isn’t designed to fix health care. It’s designed to pretend to fix it while mitigating fallout until election day.

As I stated in a different post:

If we systematically repeal Obamacare, we can have privatized health care once again. A replacement plan that tries to predict what will happen is foolish. Instead, we should repeal, then monitor and analyze the market. Over time, we’ll find the holes that need to be plugged. States, charities, and other organizations can fill most of these holes. Whatever is left, if anything, can fall to the federal government. This way, DC becomes the final safety net instead of being the first line of defense. That’s the way it should be in health care and a plethora of other areas.

The last thing this nation needs is more dollars redirected into health care. Those of us watching our premiums rise despite higher deductibles and worse coverage (which is a vast majority) know that there’s already “more dollars” in health care. It needs to be allocated properly through competition and the push for innovation. We can’t have the best health care in the world as the President hopes unless DC is willing to remove itself from the equation. Until then, the math will continue to fail miserably.

Christian, husband, father. EIC, NOQ Report. Co-Founder, the Federalist Party. Just a normal guy who will no longer sit around while the country heads in the wrong direction.

Economy

Trump expects Harley to lose money on his behalf one way or the other

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Trump expects Harley to lose money on his behalf one way or the other

American motorcycle motorcycle manufacturer Harley Davidson is in a tough spot. Tariffs imposed from Europe against imported motorcycles in response to President Trump’s tariffs on steel and aluminum have forced Harley to consider moving some production to Europe to avoid the tariffs. It’s a fair response, but the President is having none of it.

He has ratcheted up calls to boycott Harley over the potential move.

It’s imperative for President Trump’s reelection that these tariffs work. If they have the expected effect of bringing some jobs back while pushing others away, then they will be painted by the media as a failure. He knows this and therefore must do everything he can to keep jobs in America even if it means painting one of the most beloved American companies as the bad guys.

Trump backs boycott of Harley Davidson in steel tariff dispute

https://www.reuters.com/article/us-harley-davidson-tariffs-trump/trump-backs-boycott-of-harley-davidson-in-steel-tariff-dispute-idUSKBN1KX0J9The Wisconsin-based motorcycle manufacturer announced a plan earlier this year to move production of motorcycles for the European Union from the United States to its overseas facilities to avoid the tariffs imposed by the trading bloc in retaliation for Trump’s duties on steel and aluminum imports.

In response, Trump has criticized Harley Davidson, calling for higher, targeted taxes and threatening to lure foreign producers to the United States to increase competition.

My Take

What does he expect them to do? They will lose tens of millions of dollars if they continue to try to export motorcycles to Europe. They will lose even more if they stop selling motorcycles in Europe. If they try to mitigate the damage by moving some operations to Europe, the President wants them to lose money as a result. This, too, will likely result in cuts to the workforce.

In other words, President Trump will make certain Harley Davidson, an iconic American company, loses money and cuts American jobs no matter which direction they go. If he has an alternative for them that does not hurt Americans, I’m sure they’re all ears.

Most tariffs are bad in the 21st century. It’s impractical to believe we can maintain our supremacy as the world’s consumer if we continue to slap tariffs on some of our best trading partners. He either lacks the understanding of how this all works or has chosen to ignore the facts for the sake of spinning it for votes when his term concludes.

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Economy

Tariffs on Turkey: Bad for the economy but damaging to a dangerous dictator

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Tariffs on Turkey Bad for the economy but damaging to a dangerous dictator

Say what you will about President Trump’s foreign and economic policies. Whether you support them or not, it’s hard to deny that they’ve made things much more interesting.

The latest move by the President to impose stiff tariffs on Turkish steel and aluminum may seem in line with how he’s been treating the national and world economies recently, but more is at stake with this move than previous ones.

There are two factors at play that make this move different from previous tariffs. First, it is not purely economic but is a response to Turkey continuing to hold pastor Andrew Brunson for allegedly supporting the coup attempt of 2016. Second, the tariffs come at a time when Turkey’s currency, the lira, is in free fall.

It was already starting to show signs of failure when leaders from both countries pushed it even further down. Turkish President Recep Tayyip Erdogan added more challenges for the lira when he asked his people to convert their foreign currency and gold, a sign of trouble that will likely have the opposite effect.

Erdogan calls on Turks to convert hard currency, gold into lira

https://www.reuters.com/article/turkey-economy-currency-erdogan/erdogan-calls-on-turks-to-convert-hard-currency-gold-into-lira-idUSA4N1TM024Turkish President Tayyip Erdogan on Friday called on citizens to convert their hard currency and gold into lira, after the local currency tumbled to a record low this week, reflecting investor concern about a widening diplomatic rift with the United States.

Erdogan, in a speech in Ankara, also said Turkey was diverting to the Chinese market to overcome what he said were “subjective evaluations” from ratings agencies. Erdogan has repeatedly railed against credit raters, saying their downgrades of Turkey’s sovereign debt to “junk” status were politically motivated.

Seizing on the free fall, President Trump made matters worse for for the lira with the sanctions:

Trump authorizes doubling of metals tariffs on Turkey

https://www.cnbc.com/2018/08/10/trump.html“I have just authorized a doubling of Tariffs on Steel and Aluminum with respect to Turkey as their currency, the Turkish Lira, slides rapidly downward against our very strong Dollar! Aluminum will now be 20% and Steel 50%. Our relations with Turkey are not good at this time!” Trump wrote.

Losses in the the Turkish lira deepened on Trump’s tweet, falling as much as 20 percent vs. the U.S. dollar in Friday trading.

Erdogan is now calling this an economic war with the United States and claims he will not back down. Meanwhile, the Euro and other currencies are also feeling the heat:

Euro tumbles as investors fear bank exposures to Turkey

https://www.reuters.com/article/uk-global-forex/euro-whacked-on-turkey-turmoil-as-investors-scramble-for-safety-idUSKBN1KV07M“You’ve had a fairly sharp move lower in the euro and it’s broken through key technical levels as well,” said Richard Franulovich, head of FX strategy at Westpac Banking Corp in New York.

The euro dropped below technical support at $1.15 to $1.1421, down 0.91 percent on the day and the lowest since July 2017. Against the yen, the euro slid 1 percent to 126.79 yen, a two-month low.

Now, the criticism and praise of President Trump’s moves will be debated for days, maybe weeks.

My Take

As I’ve stated on many occasions, I’m not a fan of tariffs. They are misunderstood by most, particularly the President, and no longer yield the results they did in previous centuries. From an economic perspective, I oppose this move.

The bigger picture is how this is being used as a pressure tactic against Turkey. Currently, I like it a lot. That opinion could change based on how things go, but moves like these that apply pressure against a dangerous dictator of the false ally that Turkey has become are welcome. It isn’t just about securing Brunson’s release, though that’s extremely important. Turkey is a rising power on every spectrum that is increasingly turning to Russia and China for help instead of their “friends” in NATO.

The strategic importance of Turkey as a hub that connects Europe, west Asia, and the Middle East cannot be understated. In an ideal situation, Turkey would still be a good ally as they once were. Erdogan has taken advantage of two past U.S. Presidents and seemed poised last year to start taking advantage of President Trump. That doesn’t seem to be happening anymore.

Is this the right way to handle Erdogan? Probably not. Whether it is or not will be revealed in coming weeks. One thing is certain: we’re seeing things being done from the White House that we’ve never seen before and may never see again. It’s troubling, but at least it’s entertaining.

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Economy

Can Trump keep Element Electronics from closing a South Carolina plant over tariffs?

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Can Trump keep Element Electronics from closing a South Carolina plant over tariffs

For full transparency, I’m not a fan of tariffs. I know that in the end it’s not the target countries or their companies but rather the American consumers who pay for these tariffs in the form of higher prices. It’s also American countries who rely on imports to thrive that get hurt. An example of the latter is Element Electronics, the last US assembler of televisions.

According to The Hill, layoffs are planned to start in October.

South Carolina manufacturer says it’s closing plant over Trump tariffs

http://thehill.com/policy/finance/400761-south-carolina-manufacturer-says-its-closing-plant-over-trump-tariffsElement said “the layoff and closure is a result of the new tariffs that were recently and unexpectedly imposed on many goods imported from China, including the key television components used in our assembly operations in Winnsboro,” in a letter to the state’s Department of Employment and Workforce obtained by the local paper.

The company said in the letter that it hopes the closure will be temporary and added that it could reopen the plant in “three to six months, but we cannot predict this with any certainty at this time.”

This puts the administration in a pickle. Perhaps it’s better to look at it as a catch-22. They could exclude the parts needed by Element from the tariff list and save the jobs. Doing so could signal to other US companies affected by the tariffs to threaten closures and layoffs in hopes the White House will also exclude the parts and materials they import.

If the President sticks to his guns, he will gain the benefits associated with tariffs such as expanded use of domestic materials and the potential for jobs to be created in America. Of course, he’ll also have to face media backlash for every negative effect of the tariffs, including Element Electronics’ challenge.

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