Liberation or Ruination Tariffs – Part 14

Q: Do you regard the Trump administration as one driven by ideology and rationale or do you believe most of the policy decisions are irrational and random. The reason why this question is so important in the context of free trade and globalization is because many have posited the idea that globalization is dead and gone. The second question is personal and it relates to your autism and this is a subject of enduring fascination for many of us and we suspect your cachet of regular readers- the question is how do you see autism and the question on how you see the world? (From CP3 read club)

A: Greetings. Long time no see. Let me be so inmoderate and do a reverso here. Yet again. Yes, I am autistic, but I am at the functional spectrum. Or so I like to believe, though people who have interacted with me personally may tell you otherwise. As to my point on view on, it is certainly shaped by my autism. You know when I was a young engineer working as an intern in a factory in Derby that manufactured gas turbines. I remember distinctly visiting an aircraft factory assembling wings for the Tornado multirole fighter and a few weeks later when the engineers were trying to resolve a vibration issue on one section of the wing. I mentioned to my supervisor that it could be because of the high number of rivets on one specific section of the wing. Of course he was quite flabbergasted when I mentioned that the number of rivets despite only seeing it less than a few seconds. Well to cut a long story short. I was suspended for a week with no reasons given. Later on I found out that my supervisor suspected something underhand like perhaps industrial espionage as the number of rivets I had mentioned corresponded exactly to the number listed on a classified blueprint. Now if you ask me Kompf what methodology did I deploy to gain that sort of insight. Truth is I don’t know. I just know that such abilities scare people senseless. When I worked in a factory in Boon Lay, whenever a problem in production came out for open discussion. I learnt that it made far more sense to act dumb and if possible mute and deaf for the sake of self preservation. But this grated on me no end. I would come home everyday after a shift and punch the wall till my hands were numb. One thing that really bothered me when I was trying to fit into the world was how odd the world really is and this notion has never really left me till this day. I guess only someone autistic can really appreciate this statement. This feeling of always been exiled, like someone condemned to look from the outside into the deep interior of things. This was also the same reason why I find myself doing what I do today. I am a planter. Kompf I reclused myself in my own world for eleven years just to answer this one question, never got a satisfactory answer and these days it hardly matters at all. I think, I just figured out that it makes far more sense to live my life without constantly comparing myself with others . As for what others think about me, let put it this way, I can afford not to care these days. I hope my candor didn’t piss anyone in CP3 readership.

Now to the issue of Trump. Ok that question you are all asking me is – is he sane or a madman? Let me put it this way. Once you label someone as X,Y or Z. Then you really have no motivation to seek to understand them any longer. I don’t think its productive to do that. If Trump the man is just a property mogul then you could just as well do that without inflicting any violence on either your sense or sensibilities, but he is the President of the United States or disunited states depending which you consider a more accurate description. This should prompt one to ask- if Trump is sane, then what is his rationale? Its often said that Trump sees himself as a reincarnation of Mckinley of Ohio who once lauded isolationism and tarrifs. But whats seldom ever discussed and this I consider a greater omission is not to ask further where did President Mckinley get his ideas from? The answer is Friedrich List. His works influenced the Vormarz. You all go read up more on this if you are interested. My point is Trump is far from mad. He is perhaps the first President since Nixon who really takes dedolarization seriously hence his fixation with the national debt. I happen to agree with Trump. As these seemingly intractable problems can really derail the US in so many ways in the longer term. Where I think, we part waves is in his haphazard execution of how to resolve those issues. I think if Trump just rolled out a flat 10% tariff instead of his convoluted reciprocal tariff. The world may bitch about it, but they would still suck it up and just pick up and go with it. But this idea of negotiating directly one to one with a hundred or so countries is just a bridge too far. Its operationally undoable.

Is globalization and free trade dead? Far from it. But what we may be experiencing now is a redefinition of Bretton Woods. This not new, it happened in 1971 when Nixon depegged the dollar from the gold standard and set into motion global inflation. The man of that hour was Paul Volcker – who many consider the quintessential great man, but to me he was just a credentialed Ponzi scheme operator who knew perfectly well the very monetary system he had put in place would one day come crashing down, simply because the entire raison detre of the system was based on faith i.e the dollar will always be the reserve currency of the world. That day has unfortunely cometh and the wheel stops at Trump’s shift. The point that I am trying to make here is Trump is hardly mad. And even if there exist madness, there’s actually a vein of compelling sanity in how he sees the US in relation to the rest of the world. Hence when Trump says that the rest of the world is ripping off the US. There is some truth in that statement because how is it possible for a biggest debtor nation to continue running huge trade deficits with every other country in this world? How sustainable is that? Its only sustainable if the debt ceiling keeps get adjusting upwards, but even then at some point the interest payments on those debts will come back to bite real hard. This may account for why in Trump world parlance words such as rebalancing or resetting the global order seems to be redolent. The problem as I see it is the credentialed class don’t understand what Trump or the MAGA movement really wants out of this global shake up. They seem content to just poke fun at Trumpism like how one would make fun of a dancing bear. To me that’s both counterproductive and dangerous.

The other question you all asked is globalization and free trade dead? I don’t think something as robust as the free market can just roll over and die without something better and spankier to replace it. People who insist globalization is well and truly dead if you care to observe never ever discuss what comes after. But even if it survives, it will probably be reincarnated into a system that operates alongside what has been hatched in Bretton Woods. I see globalization and all its appendages and surrogates settling into a dual lane system, one that’s the rule based order that is still governed largely by the doctrine of Pax Americana and the other that is led by Brexit. Each system will have its advantages alongside disadvantages. And I dont believe its possible for the US or for that matter China to demand nations to choose between the two. Some countries will of course opt to remain within the orbit of the US trade system, but most will be freelancers who will play both sides because they can…..we live in exciting times Kompf.

Hold on tight!