Comments by "Peter" (@peter65zzfdfh) on "DW News"
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@ghsense2626 by American free money you mean your pension is invested in Europe, as are most of the US’s biggest companies. That money is spent, if you want cents on the dollar for it, try and sell off that investment in a hurry.
The US needs Canadian and Mexican car parts to keep factories operating, it needs Chinese steel, it needs Chinese lithium. It needs Taiwanese computer chips made with Dutch machines. Some of these could be replaced (not the lithium or rare earths) but not for a decade or two. In the meantime lots of pain while the rest of the world trades among itself.
The US is the second biggest exporter after China, but most of the value the US exports is things like movies, TV, software etc, that aren’t really needs and easily replaced or cloned. The US is only wealthy because other countries have agreed to let it become so, because a strong US has benefited them too.
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@butapioka El Salvador had a crime issue, they just centralized the criminal behavior in the new president instead of gangs, and that helped a lot of people at the cost of sending a lot of potentially quite innocent people to prison and basically removing everyone's freedom. In such circumstances people will argue that safety and stability are more valuable than freedom, and people have fought forever on just how far society should be tilted towards freedom vs public safety. There are more people per capita in prison in El Salvador than any other country in the world. Ultimately this playbook has happened again and again throughout history, controlling leader comes to power promising to centralize control and fix everything, and for a time they're quite popular, but then they never give up control and progressively do less and less popular things while refusing to give up their power. Other than the crime crackdown the 'radical changes' promised in El Salvador didn't end up eventuating (he tried, on a relatively small scale and failed). He's been pretty boring and basically kept spending the same, no massive cuts, no massive spending. They've also been on the USD since 2001, so they didn't have to try and make that massive change under his watch.
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@A.S.D442 Somalia has less than half the Debt to GDP ratio of Argentina. Basically, they're poorer than Somalia, and Somalia's economy is tiny compared to Argentina's, so debt forgiveness is a big component of how Somalia has not suffered in the same way, because there are much much smaller amounts to forgive. Argentina owes 100x as much money as Somalia, that means there's a lot more USD in Somalia compared to the size of the economy. Also, the USD isn't the official currency of Somalia, using it unofficially allows the government to manage parts of the economy in different ways, once you give up your own currency you lose that ability. Yes, you can mis-manage that ability as in Argentina, but that mis-management was less of the actual issue than the stagnant GDP which is the relevant metric regardless of which currency you use, Somalia's GDP has doubled in 10 years. Argentina's GDP hasn't gone anywhere in that time.
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A trade war is lose/lose. If the US tariffs the whole world and the whole world tariffs back, the US cumulatively has to pay all the tariffs they have against the world, while other countries can freely trade with each other and only have to put tariffs on the one country.
Canada has put tariffs on things they don’t need from the US, while the US has put blanket tariffs on everything including things like car parts, and oil, that the US needs to make cars and refine oil etc to on sell to other countries.
Tariffs are, I will hurt myself so I can hurt you. Both parties lose, but if you don’t retaliate then there’s little chance of stopping someone insane enough to want self harm. Especially those too rich to feel the harm personally.
Basically the more countries put tariffs on the US in response the worse for the US. If Trump just put tariffs of China, not Mexico or vice versa, the US might not lose so badly. But China, Mexico AND Canada, no chance the US doesn’t wind up the biggest loser. Everyone loses, just not as much.
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