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Paul Krugman @paulkrugman
, 3 tweets, 1 min read Read on Twitter
What I've been saying. Not just China, either Suppose you're a European leader, and you really want to avoid a confrontation. Well, Trump says eliminate your "horrible" tariffs -- but your tariffs are only 3 percent. What do you do? 1/
As best I can figure out, the Trump team still thinks VATs are tariffs. But they aren't -- and EU countries, on average, collect 7 percent of GDP from VATs, which is a lot of money; not something they can give up 2/
So Trump has set up a trade conflict in which there is no way the other side can accommodate his demands, because those demands are vague and/or incoherent. Retaliation designed to hurt the GOP is the only option he's giving the rest of the world 3/
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Good piece from Bloomberg pointing out that Sweden actually has a top marginal rate of almost 70% -- and grass is hardly growing in the streets 1/ bloomberg.com/news/articles/…
I'd also point out that while the US federal top rate is only 37 -- it was 39.6 before the TCJA -- there are also state and local taxes. If you're a high earner in New York City, you pay almost 9% state and almost 4% city tax at the margin 2/
Plus sales taxes -- 4.5% state and 4% city -- also reduce the purchasing power of a marginal dollar earned. Put all of this together and high earned-income individuals (as opposed to capital incomes) pay a marginal rate of 55-60% 3/
Read 6 tweets
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Not really relevant to this article, but it reminds me of what it was like being a young international trade economist. At that time the field was dominated by Canadians and Australians 1/
Why? English as a first language was an advantage, given its dominance of the journals; but Americans didn't really believe the rest of the world existed (not sure why there weren't more Brits) 2/
And what that means is that in my memory, two things are indissolubly linked: seminars on trade theory, and lots and lots of beer. I think I was in my late 30s before I even realized that an economics conference could run on wine instead 3/
Read 3 tweets
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There's a political puzzle that has worried me for a while, and is highlighted by some of the responses to today's column. What some of the pushback against @SenWarren comes down to is "I feel like she's talking down to me" 1/ nytimes.com/2019/01/07/opi…
The reason this is puzzling is that she really isn't. She does try to explain issues, but there isn't any condescension I can find -- and nothing like the sneering contempt for his supporters that shines through everything Trump does and says 2/
Yet this is a real thing, not to be wished away. And I don't think it's just sexism -- in general, politicians who try to understand issues get grief from a segment of voters who seem perfectly happy with politicians who clearly consider them chumps 3/
Read 5 tweets

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Who funds the IEA, the TPA, the ASI &co?
You know, the RW 'free trade' thick tanks advocating tax havens, "freedom" (no regulations like workers' rights or environmental protection), no welfare (no tax & no free healthcare).
Basically, "Only the wealthier survive" philosophy?
1/n
*Could it be* that it has something to do with defending their funders' interests?
Today, I'm going to tell you the Thick Tanks' Hydra tale.
Featuring Atlas, huge piles of money, tradition, "free speech", useful idiots and a very clear agenda that Brexit/Trump are a part of.
2/n
Take a seat: It's a long story, with a lot of players, including politicians, pretty ladies squatting your TV, the climate change denial's network, the global fascist movement, Silicon Valley/multiname data-stealing/misusing company & private companies' involved in elections.
3/n
Read 249 tweets
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#China will attempt a forceful unification with #Taiwan by 2021, the centenary of the Chinese Communist Party. Xi's grand dream of national rejuvenation entails unifying all that #CCP considers Chinese lands, especially Taiwan.

This THREAD looks at this potential scenario.
The legitimacy of the #CCP regime under Xi is based on the twin pillars of economic growth and nationalism. For the party-state, unifying the mainland and Taiwan is critical to its aspirations of national rejuvenation and erasure of national humiliation.
Why would PRC force a unification as early as 2021? 1) 2021 is the centenary of the #CCP; anniversaries and dates have massive symbolic importance in China's political culture. 2) Xi wants unification to be part of his legacy. This is the only way that he can outshine #Mao.
Read 26 tweets
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In light of today US-China tariff escalation, worth highlighting some of the incredible details in @SenRonJohnson's letter to the Administration about harm from 232/301 #tariffs to #Wisconsin companies. #TariffsAreTaxes #TariffsareBAD bit.ly/2Lm4Nr6 1/X
@SenRonJohnson From @CV_Bean in Menomonie, Wisconsin: “CVB has cancelled over $3.5 million in capital purchases for 2018 since the retaliatory tariff was applied, as well as scrapping over $15 million in expansion plans for 2019."
@SenRonJohnson @CV_Bean More from @CV_Bean: "Kidney bean suppliers in Canada, China & Argentina will raise their prices, too, slightly below the US base price plus the tariff. The end result is that our competitors will increase their profit margins while US farmers can’t sell their beans.” 3/X
Read 14 tweets
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1. The #Trump administration would like us to believe its sanctions policy is about changing “the behavior of the leadership in #Iran to comport with what the Iranian people really want." Now we have the chance to test whether this is really true.
bloomberg.com/view/articles/…
2. As I write in @bopinion, #Iran has a new central bank governor, Abdolnasser Hemmati. He has a lot on his plate. A currency crisis exacerbated by sanctions fears took his predecessor down. The Central Bank of Iran is going to be placed under sanctions once again next week.
3. European governments are working to find ways to facilitate payments to #Iran's central bank despite the returning US sanctions. But Iran needs to meet the reform requirements set by #FATF to better prevent financial crime. This is a precondition for these special solutions.
Read 9 tweets
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"Trump has used Harley-Davidson as an example of a US business that is being harmed by trade barriers. Yet Harley has warned consistently against tariffs, saying they would negatively impact sales"

Harley, hit by tariffs, shifts some production overseas apnews.com/6c8942f7363743…
Important issue highlighted by @riotwomennn: are tariff exemptions determined by bribes?

Corker: "22,000 companies have asked for exemptions.There is no basis to deal with them. Are they going to grant these exclusions based on political contributions?"
Trump’s trade war with the European Union is going to cost Harley-Davidson as much as $100 million a year and force the manufacturer to shift production out of the U.S. bloomberg.com/news/articles/…
Read 232 tweets
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Trump Hotels' website still lists Trump SoHo New York among its properties in the Our Hotels menu. Select its name though to access its page and there's a message about it being renamed

bit.ly/2EPCSy1
National politics correspondent for Newsweek, Nina Burleigh, with a fun find on a TV above the bar at the Trump Hotel DC bit.ly/2E37QRR
Two errors in the 2nd graf of Breitbart's Trump Hotel DC article:
-holdings aren't out of @realDonaldTrump's hands: trust isn't blind & he can profit from it
-Trump Org told Congress it was estimating foreign receipts—not auto donating in full
bit.ly/2CpL7z2
Read 1562 tweets

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