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Bernardo de La Paz

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Member since: Fri Jul 16, 2004, 11:36 PM
Number of posts: 35,193

About Me

Canadian who lived for many years in Northern California and left a bit of my heart there.

Journal Archives

Wilbur Ross used deceitful deceptive argument to defend Trump Tariff

CommSec Ross said there are 2/10 cent steel in a soup can and 3/10 cent aluminum in a coke can.

“All this hysteria is a lot to do about nothing,” he said. The cost of items such as Campbell’s Soup cans and Coke cans will increase by less than a cent, he added.


The cost of the can won't change much, but the PRICE on the shelf will go up noticeably.

The machinery that makes the cans and fills them will cost more. The machinery that prints the labels will cost more.

The farm machinery that plants and harvests the food materials will cost more.

The trucks that move the cans will cost more because of steel costs.

The tools that fix all that machinery will cost more.

The steel shelves will cost more.

The steel in the construction of the packing houses, the food factories, the distribution warehouses, and the supermarkets will cost more.

By time you dial in all the costs going into the products and getting them through the manufacturing and supply chains, the PRICE will add up because it is multiplicative, not merely additive. When the food is more expensive to produce, the food cost goes up which raises the cost from the food factory to the distributor by a percentage because it costs and prices and profits are calculated on dollar volumes, not unit counts. The cost to the retailer goes up when the distributor raises prices.

Until proven otherwise, we have to take the position that Ross knows this and was deceiving the public and using the taxpayers' dimes to do so while being paid salary.

Posted by Bernardo de La Paz | Fri Mar 2, 2018, 10:44 PM (1 replies)

RepubliCONs are Borrow-and-Spend. Defense money is dead money. Rich park tax cuts in real estate/art


The old canard that Republicons use against Democrats is that they are "tax-and-spend". Republicons are of course borrow-and-spend, which is hypocritical.

You also have to factor in business cycles. Democrats tend to grow the economy and fix up deficits with a mix of fiscal prudence and some raised taxes. If they inherit a big economic problem like Obama did, they will stimulate the economy.

This is basic economics: Stimulate with government spending and some broad tax cuts during hard times, and pay down the debt during good times with raised taxes and fiscal prudence.

But there's another aspect to what the RepubliCONs did that make their willful mistake worse: Bombs and tanks do not produce more money (production). Machine tools and computers do. Building a jet fighter puts money in motion for a very limited time. Once the fighter is produced, it consumes money and doesn't make anything. Yes, defense is needed for national security, within limits.

However, it gets worse. By giving tax cuts to the rich, they do not invest in production. They are already fully invested; they need more investment opportunities. They park the money in real estate and art which inflates the prices of those two elements.

Tax cuts to the middle class and especially to the poor put money in motion. The money is quickly spend on food and housing and transportation and education. All of those are productive. Healthy people work longer hours. People with good housing are able to provide their children with better parenting and upbringing. People with cars or money to spend on public transit hold more jobs more securely and that makes the economy grow.

Posted by Bernardo de La Paz | Fri Feb 9, 2018, 10:16 AM (0 replies)
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