US/Canada Trade War ?

[The Don]

Canadian lumber tariff.

Again, I'm not clear how more expensive lumber, more expensive houses , lower demand and consequential layoffs in related industries is "good" YMMV

 

[logger]

Again, I'm not clear how more expensive lumber, more expensive houses , lower demand and consequential layoffs in related industries is "good" YMMV

Because people want to make more money. You do realize prices rise? We've had anemic wage increases for many reasons, one is we're competing with overseas slave labor. Funny how you seem to think a small rise in prices will destroy an economy. Bet you're all for tax increases?

 

[logger]

A feel good story.
https://www.nytimes.com/2017/05/11/business/economy/steel-nucor-trump-policy.html?_r=0

 

[The Don]

Because people want to make more money. You do realize prices rise?

The thing is that a few people may benefit incrementally from the price rise but a much larger number of people will suffer and to a much greater extent.

We've had anemic wage increases for many reasons, one is we're competing with overseas slave labor.

There are many complicated reasons for why a significant portion of the US population have seen real terms wage reduction but increasing the tariffs on imported goods are unlikely to help the situation and likely will have the opposite effect as businesses have to respond to rises in the costs of imported goods and services by squeezing domestic costs, including labour costs.

Of course in the case of Canadian softwoods, Canadian wages are higher so the point in this case is moot.

Funny how you seem to think a small rise in prices will destroy an economy.

I don't recall saying that - I do recall pointing to a study carried out by industry experts who concluded that a rise in lumber prices will likely hit jobs in the construction and related industries.

Maybe you have me confused with an alt-reality

Bet you're all for tax increases?

It depends. What taxes, on whom would they be levied, on what would they apply and what is the purpose of the tax increases ?

 

[The Don]

A feel good story.
https://www.nytimes.com/2017/05/11/business/economy/steel-nucor-trump-policy.html?_r=0

Indeed, that's all it is, a feel good story

Stock prices are up but as yet there is no indication that demand for steel is rising or that the steel in question will be provided by US steel producers. Indeed, so far action has been thin on the ground....

......neither the administration’s backtracking on a promise to use American-made steel in the Keystone XL Pipeline or its messy battles with congressional Republicans and low approval ratings have damped optimism about the president or his agenda

and of course it may not result in any more steel jobs, just higher profits for steel companies:

If trade policies have eaten away at steel industry jobs, so have technological advances like Nucor’s electric arc furnaces, which recycle existing iron and steel instead of making it from scratch. The old-style blast-furnace steel plants that resembled volcanic Mordor from “The Lord of the Rings” and employed legions of boilermakers, electricians, steamfitters and more are on the decline in the United States.

In the 1980s, for example, making a finished ton of steel required about 10 human-hours of work. Now the Huger plant can make that same ton from recycled material in 0.4 human-hours, said Mr. Daughtridge, who has worked for Nucor for 33 years.

 

[Spindrift]

Canadian lumber tariff.

You could just say you can't think of anything.

 

[newyorkguy]

I think sometimes we can get a more objective analysis by looking at news media reports from third parties. This is from Britain's Telegraph:

In reality, the imposition of tariffs was anticipated, irrespective of who won the race to the White House last November. The US has long been convinced that Canada is subsidising its lumber industry illegally, by allowing loggers to cut down trees at artificially reduced rates.

Wilbur Ross, the US commerce secretary, announced Washington was imposing a tariff on Canadian lumber. "[On April 24th] it became apparent that Canada intends to effectively cut off the last dairy products being exported from the United States. Today, the Department of Commerce determined a need to impose countervailing duties of roughly $1bn on Canadian softwood lumber exports to us. This is not our idea of a properly functioning free trade agreement.” Link

 

[Spindrift]

I think sometimes we can get a more objective analysis by looking at news media reports from third parties. This is from Britain's Telegraph:

This at the end is interesting.

However, Steve Jarding, a lecturer in public policy at Harvard School of Government, is fiercely critical of Mr Trump and believes the move could be costly. “It’s horrible. He has singled out lumber and dairy, and they are not even covered by Nafta,” he says.

“You don’t create policy in a vacuum and that is what he is doing. It is just a show – he is puffing out his chest to show how tough he is. The whole thing is madness – it sets a precedent and other countries will retaliate.”

 

[newyorkguy]

Steve Jarding, a lecturer in public policy at Harvard School of Government? An obvious pinko! In fact I was flabbergasted that logger linked a source -- that was shocking right there -- but the fact it was from the failing New York Times fake news website. Huh?

Seriously, there is some question as to how much cost the lumber tariff will add to things like home-building. The lumber trade group says less than a $1,000 per home while a builders' group says way over $1,000 per home.

The National Association of Home Builders has come out strongly against the tariffs...The NAHB says a typical single-family home uses roughly 15,000 board feet of lumber, and that the Q1 price hikes could add nearly $3,600 to the price of a new home.

The U.S. Lumber Coalition offers a different view of price impacts, saying that the total cost of lumber for a $350,000 house is $6,000, for which duties would add an additional $400. Link

 

[logger]

The thing is that a few people may benefit incrementally from the price rise but a much larger number of people will suffer and to a much greater extent.

And people will suffer if prices go down.

There are many complicated reasons for why a significant portion of the US population have seen real terms wage reduction but increasing the tariffs on imported goods are unlikely to help the situation and likely will have the opposite effect as businesses have to respond to rises in the costs of imported goods and services by squeezing domestic costs, including labour costs.

One of those reasons is low wages in other countries. Canadas wages can be higher since the government dumps their softwood.

Of course in the case of Canadian softwoods, Canadian wages are higher so the point in this case is moot.

Stumpage prices being lower allows business to charge more.

I don't recall saying that - I do recall pointing to a study carried out by industry experts who concluded that a rise in lumber prices will likely hit jobs in the construction and related industries.

Well, that settles it then.

It depends. What taxes, on whom would they be levied, on what would they apply and what is the purpose of the tax increases ?

Might be easier to figure out the ones you would be against.

 

[logger]

Indeed, that's all it is, a feel good story

Stock prices are up but as yet there is no indication that demand for steel is rising or that the steel in question will be provided by US steel producers. Indeed, so far action has been thin on the ground....

Its a huge hole to dig out, but they're headed in the right direction. Something Obama was incapable of.

and of course it may not result in any more steel jobs, just higher profits for steel companies:

Selling more domestic steel may not result in more jobs? I suppose wishful thinkers would post that, but it's not rooted in reality.

 

[logger]

Steve Jarding, a lecturer in public policy at Harvard School of Government? An obvious pinko! In fact I was flabbergasted that logger linked a source -- that was shocking right there -- but the fact it was from the failing New York Times fake news website. Huh?

I "feel" it necessary to put up leftist rags that your side might believe a little easier, it's my caring heart that is sensitive to your sides needs.

Seriously, there is some question as to how much cost the lumber tariff will add to things like home-building. The lumber trade group says less than a $1,000 per home while a builders' group says way over $1,000 per home.

Certainly would depend on the home size.

 

[newyorkguy]

I "feel" it necessary to put up leftist rags that your side might believe a little easier, it's my caring heart that is sensitive to your sides needs.

This isn't an argument; it's the opposite of one. It doesn't lead to a discussion. It leads to the opposite of one.

Certainly would depend on the home size.

Thanks for the insight. Real insider stuff.

 

[logger]

This isn't an argument; it's the opposite of one. It doesn't lead to a discussion. It leads to the opposite of one.

Chiding me for posting the NYT, will get you the answer you wanted. Shall I say, you started it!

Thanks for the insight. Real insider stuff.

Then you post this, so here's my answer. Need to know the average size of the home each group is using. The figures should not, of course, be that far off.

 

[newyorkguy]

What touched this off was apparently the Canadian system of stabilizing milk prices. Because prices are very volatile, American dairy products are usually not sold in Canada. This is from NPR:

In Canada, the price of milk that dairy farmers sell isn't based on supply and demand. Rather, a group of people from industry and the government get together and decide what's fair. They set the price high enough to cover a good farmer's costs, plus a little profit. Murray Sherk [an Ontario dairy farmer] says it's designed "to provide what you'd call fair returns for efficient producers."...It's called supply management, and part of it involves keeping out imports of cheap milk from the United States.

American dairy farmers like Bill Bruins, in Fond du Lac County, Wis., are constantly reacting to shifts in the supply and demand for milk. "You have high prices followed by low prices followed by high prices," Bruins says....Right now, prices are low because the world's cows are producing too much milk. They're so low, in fact, that some dairy farmers are giving up and selling their cows. This is the sometimes-brutal way that markets bring supply back in line with demand. NPR link

 

[The Don]

Its a huge hole to dig out, but they're headed in the right direction. Something Obama was incapable of.

1 million manufacturing jobs were created during Obama's Presidency, an 8% increase. Under George W Bush, there were 6 million fewer a 33% drop - Obama was doing pretty well actually.

Selling more domestic steel may not result in more jobs? I suppose wishful thinkers would post that, but it's not rooted in reality.

Yes if plants continue to improve their efficiency as they have done over the past 30 years they could soon be producing twice as much steel with half as many people.

Over that period, the amount of steel per work hour has increased by a factor of 25, doubling every 6 years or so.

 

[logger]

1 million manufacturing jobs were created during Obama's Presidency, an 8% increase. Under George W Bush, there were 6 million fewer a 33% drop - Obama was doing pretty well actually.

Starting in the base,ent does usually help your numbers. He did nothing! Each depressing quarter was nothing but average or below average.

Yes if plants continue to improve their efficiency as they have done over the past 30 years they could soon be producing twice as much steel with half as many people.

Over that period, the amount of steel per work hour has increased by a factor of 25, doubling every 6 years or so.

You do want high paying jobs. The steel sector has no where to go but up, as i said they're in a huge hole!

 

[newyorkguy]

...Need to know the average size of the home each group is using. The figures should not, of course, be that far off.

The house sizes were given in the link I supplied which is to a construction industry website, not a general news site. The figures are very different:

The National Association of Home Builders says a typical single-family home uses roughly 15,000 board feet of lumber, and that the Q1 price hikes could add nearly $3,600 to the price of a new home....

The U.S. Lumber Coalition offers a different view...“An average home uses 13,000 board feet of lumber,” van Heyningen said. “With an average composite framing lumber price of $435 today, it adds up to $5,655 total in the cost for lumber, which makes it impossible for a 20% duty on one-third of that lumber to result in a cost increase of $3,600 to the consumer.”

 

[logger]

The house sizes were given in the link I supplied which is to a construction industry website, not a general news site. The figures are very different:

Yeah I saw that, but generally home square footage is a much better indicator so I'm not really sure why they do it that way. Either way a few thousand added can be easily absorbed and a much needed pay raise for logger(s)

 

[The Don]

Starting in the base,ent does usually help your numbers. He did nothing! Each depressing quarter was nothing but average or below average.

Average against what metric ? Better than either Bush, better than Trump so far (though he gets a pass from me because it'll be a year until the effects of his policies filter through)

You do want high paying jobs. The steel sector has no where to go but up, as i said they're in a huge hole!

The question is, if there is increased demand for US steel (and there's still no guarantee that Trump will make good on his promises - Keystone is a good indicator of that), will it result in more steel jobs ?

On current evidence, the answer would have to be no, the increased demand will be met through increased automation.