When it comes to trade, and trade deals, Trump’s low-information following is all about their candidate’s plans. They love his tough talk and his bloviations regarding China and Mexico…about how he intends to “make America great again,” by imposing stiff, 45% tariffs on our trade partners if they don’t straighten out and let us win.

It sure sounds good, unless of course, one looks into the details and has a shred of common sense about them.

What Trump is proposing is economic nationalism. America first and to hell with everybody else. If Mexico and China don’t do exactly what Trump and his low-information followers want, Trump…should he become the president, will stick it to them but good with 45% taxes on any products that either country tries to send to the United States.

But that’s not all…

Trump has also made it quite clear that he would also slam high taxes on American companies that have already located in foreign countries or those who are thinking about doing so thus intimidating them into NOT relocating, or making doing business FROM a foreign country so pricey that they will be FORCED to return home to America.

As I said…sounds good to the low-information crowd but…

Today, Indiana is up for grabs and that is where Carrier, the heating and cooling giant announced they were leaving for greener pastures in Mexico…a fact that has set Trump and his low-information followers hair on fire as Trump is telling Indiana’s voters that his policies and his alone, are what is needed FOR the state of Indiana.

It’s a lie.

In fact, Trump’s policies will do great HARM to the state of Indiana and its economy.

Indiana relies heavily on international trade to keep its economy up and running doing the bulk of that trade with Canada and Mexico to the tune of some $17.5 billion dollars every year which accounts for about half of their overall exports.

If Trump has his way, and 45% taxes are imposed on IMPORTS…countries hit with those taxes will respond…in kind, with equally high taxes of their own. It’s called a trade war and once it starts, it is very hard to stop and the result is higher and higher prices, due to the higher and higher taxes, until a couple of things happen.

Either the business doing the exporting can’t afford the taxes and is then forced NOT to export their goods, or consumers can’t afford to pay the prices and simply quit buying the goods thus forcing the companies to no longer produce the goods.

Either way, it would be devastating to a state like Indiana that exports some $35 billion dollars in goods annually.

Let’s go back to Carrier for a moment…

Should Trump get his way…Carrier would no longer be able to afford to ship their products or repair and replacement parts to the United States so…what has Trump and his low information followers just plain giddy, is the prospect that Carrier would then alter its course and stay in Indiana, but would that actually happen?

If Carrier were to stay, because of the tax penalties imposed under Trump…they would also not be able to afford to EXPORT their goods and thus, they would be forced, by Trump’s economic nationalism, to sell their goods primarily in the United States and cut out large portions of their international business which would lead to down-sizing their company and their workforce dramatically.

Carrier’s move to Mexico will save them $65 million dollars per year which, in the grand scheme of things, isn’t all that much for a company that sported $56 billion in revenue last year, but under a Trump regime and his economic nationalism approach, what makes more sense? Staying in Indiana and selling to maybe 50% of their worldwide market or moving to Mexico and selling to 95% of their world market?

And it’s not just the taxes that are making Carrier move to Mexico either.

Carrier sites 53 federal regulations as factors in their decision to make this move and that is something Trump doesn’t seem concerned with…but Ted Cruz IS.

Cruz has been campaigning on the need to kick the overly burdensome regulations, imposed by the federal government, to the curb so as to free businesses, large and small, from the shackles that bind them and prevent them from expanding. If businesses, especially manufacturing businesses, are so constrained by federal regulations that they can no longer grow, then they can also no longer create new jobs.

Under the Cruz plan, corporate taxes would be cut, making them competitive rather than penalizing and the burdensome federal regulations would be removed from the shoulders of manufacturers and small businesses thus allowing for expansion and the creation of new jobs.

But tariffs? Up to 45% against imports? That is NOT part of the Cruz package at all which would alleviate the prospect of Trump’s trade wars which would necessarily lead to economic disaster.

But Trump’s low-information voters believe the inevitable trade wars, stemming from Trump’s economic nationalism, would be worth it in the long run because that’s what he has told them…but what is the reality of those trade wars?

Yes…Mexico and China would see their economies collapse. That much is true but that is where Trump stops talking and his low-information voters stop listening. There is another side to that coin as illustrated by Moody’s Analytics which shows the effect on OUR economy.

Under Trump’s 45% tariff trade war proposal, not only will Mexico and China suffer economic recessions…so too would we. In fact, our economy would lose some 4 million jobs outright and fail to create another proposed 3 million jobs that projections show would be created without said trade wars.

According to Moody’s, the best case scenario would have neither China nor Mexico retaliate against Trump’s tariffs thus cutting job loss and the non-creation of new jobs in half by which we could avoid our own recession, but our economic growth would stagnate, and we would show no gain in GDP.

While economic predictions are always iffy, it’s better to hope for the best while preparing for the worst and the worst possible outcome of Trumpenomics would be a recession that becomes a full-on depression because there is little, if any reason, for China and/or Mexico not to retaliate and start a trade war.

In business, when things haven’t worked out, Trump has simply declared bankruptcy, taking advantage of the rules he claims are broken and walks away. This is something he could not do as president. One can’t just declare bankruptcy from the oval office and walk away from the mess and we already have a mess, what with our national debt at $19 trillion dollars and approaching $20 trillion rapidly.

Another issue which cannot or should not be ignores in any honest discussion of Trump’s economic plan is his tax plan, which nearly echoes that of Obama and would, over 10 years, add $10 trillion dollars to our national debt. Now, consider again the Moody’s projection of a trade war, that will cut millions of jobs and prevent millions more from being created while at the same time, crushing our GDP and add to all that, higher taxes on those who actually create jobs, and an overall tax system that adds $10 trillion to the national debt over 10 years and you actually have the recipe for that full-on depression.

For now, it is all but certain that Trump’s low-information voters will ignore this warning and the pending reality, as outlined above, but what will they say when it all starts going south on them should Trump actually win both the nomination and the general election? If, and it’s a big if, they ever do come to their senses, it will be too late.

What we need are lower taxes across the board, incentives for businesses to stay in America or come home from foreign countries rather than penalties and punishments and a trade policy that evens the playing field rather than escalating tensions into a trade war from which there is no way out.

Trump’s economic nationalism, or Trumpenomics, as I have called it, is exactly the wrong approach but it sure sounds good to those who refuse to look at the big picture…Trump’s low-infornation voters and for that matter, Donald Trump himself.

SPECIAL NOTE!!

As my partner and friend, Diane Sori, is in FB jail, I urge you to read her very important article, “The Battle Between God and Medicine…Part 1 of 2” by clicking here and please share both her article and mine. Thanks so much!!!