Boeing, etc and Int Trade

[Bill Greenwood]

There is a lot of talk now about international trade agreements. I dont know or understand much about them. Does anyone have a SIMPLE explanation?
Are they generally good for some companies like Boeing, GE (engines) which have huge foreign customers? Are they good or bad for U S consumers or some segment of the work force?
Please, Id like to know the background and the unbaiased facts, lets not make it about any candidate.
In fact it is confusing enough that some advocates or candidates who are normally allies have opposite stances on a agreement.
Thanks and again , please keep it factual and unbiased if anyone knows about this idea.

[rwanttaja]

There is a lot of talk now about international trade agreements. I dont know or understand much about them. Does anyone have a SIMPLE explanation?
Are they generally good for some companies like Boeing, GE (engines) which have huge foreign customers? Are they good or bad for U S consumers or some segment of the work force?
Please, Id like to know the background and the unbaiased facts, lets not make it about any candidate.
In fact it is confusing enough that some advocates or candidates who are normally allies have opposite stances on a agreement.
Thanks and again , please keep it factual and unbiased if anyone knows about this idea.
It's hard to answer a political question without delving into politics. Also, "International Trade Agreements" is a rather broad term. It's like asking, "Can someone explain the Federal Aviation Regulations?"

All countries want to promote export of their goods, and nurture their own industries. However, these factors are scrambled by other factors, when the government of Country A wants a certain political favor from Country B, and offers a trade concession of some sort to "sweeten the pot." So a treaty might be signed, to reduce the import duties Country A imposes on framistats produced by Country B, in exchange for cheaper iron ore from Country B...whether or not that iron is actually used to build framistats. Doesn't have to have anything to do with production either. Could be just a straight political favor, such as supporting Country B in a border dispute.

This isn't necessarily limited to between countries, either...sometimes companies themselves work directly with the countries.

Here's an example. A while back, I was peripherally involved in a major new satellite communications system. The company we were developing the satellites for needed reservation of its operating frequencies around the world, which is handled by the UN's International Telecommunications Union (ITU).

We had three bids for building the solar arrays, and accepted the one that cost about twice as much as the other two bidders. But it was a major Government-owned company in Country B, and the company developing the SATCOM system needed that Government's support to win approval at the ITU.

Ron Wanttaja

[dclaxon]

Does anyone have a SIMPLE explanation?


I don't think there is such a thing as a simple explanation of international trade agreements. Or anything else the guv'mint is involved in, either.

Dave

[FlyingRon]

Sure. Almost everything done in international trade is done on the basis of reciprocity. If we raise a tariff on an imported good, the foreign country similarly raises tariffs on our goods. It generally has been found that lowering the barriers to trade benefits the economy's on both sides. ( In 1930, the Republican-controlled House of Representatives, in an effort to alleviate the effects of the... Anyone? Anyone?... the Great Depression, passed the... Anyone? Anyone? The tariff bill? The Hawley-Smoot Tariff Act? Which, anyone? Raised or lowered?... raised tariffs, in an effort to collect more revenue for the federal government. Did it work? Anyone? Anyone know the effects? It did not work, and the United States sank deeper into the Great Depression. )

The President can't enter directly into these agreements. The Constitution requires agreements with foreign governments (called TREATIES) to be approved by the Senate. Therefore we need things like GATT and some of the things like NAFTA and the TPA to be negotiated by State and approved by the Senate.

[Dana]

Free trade agreements are good for companies who sell products overseas (and their workers). They're good for companies (like Walmart) whose business model is to buy cheap foreign products. They're bad for companies (and their workers) competing with overseas companies that can produce products cheaper. They're real bad for workers formerly employed by companies that move production overseas.

In a perfect world, it wouldn't matter. But we're competing with overseas companies with vastly lower labor costs, that aren't burdened by US environmental regulations, OSHA, workman's comp, unions...

I would like to see tariffs large enough to offset the difference in regulatory and labor costs, but not enough to prop up truly inefficient industries.

[FlyingRon]

Sorry, Dana, but I do not agree. This would be true if the US wasn't exporting things to other countries, unless you have a way out of line trade balance, lowering the barriers helps both sides.

[Kyle Boatright]

Why is this on the EAA's discussion forum? There have been several similar threads recently that are potentially interesting. But they belong elsewhere.

[Mark17]

Why is this on the EAA's discussion forum? There have been several similar threads recently that are potentially interesting. But they belong elsewhere.

It's really important to understand the ramifications of any international trade agreement not only as Americans but as pilots as well. Any decision our government makes with regard to international trade specifically has a direct impact on us as pilots so it's important to understand the pros and cons. International Trade Agreements are directly corralated to the price of goods and services as well as supply and demand which in turn directly impacts both our economy and our jobs. All of this comes right back to flying and impacts everyone on this forum. Just look at Oshkosh attendance numbers of late and compare that to just a few years ago before Jack took over. There was questioning at the time if Airventure could be saved. None of that would of ever happened if the economy hadn't fallen apart to the tune of the greatest economic disaster since the Great Depression. It's all directly corralated and it truly matters. Talking about it and learning about it is extremely important. It doesn't have to be political but moreover, it should be a positive and educational robust discussion. If Bill wants to know what other forum members know about the topic, it's a great place to start. As pilots, we as a group are pretty intelligent. Why not ask other members who might have some intelligent insight and background?

[Dana]

Sorry, Dana, but I do not agree. This would be true if the US wasn't exporting things to other countries, unless you have a way out of line trade balance, lowering the barriers helps both sides.

Tell that to all the unemployed people who have lost their jobs due to cheaper imports, or when their own company has moved production to somewhere cheaper overseas. Our trade balance is way out of line.

[martymayes]

Why is this on the EAA's discussion forum?

Because EAA related topics don't seem to generate much interest and participation?

[Bill Greenwood]

Even standard airplanes, not just Boeing, nowadays have a lot to do with int trade. Evewrything nis not made here anymopre and customers are not just local. A small segment , but most gliders and many acro planes are foreign. Also avionics ,instruments. tiress.
Trade agreements may affect labor rates and labor is a big part of airplane costs.
And thanks for those who have given their best answer, or tried to.

[rwanttaja]

Why is this on the EAA's discussion forum? There have been several similar threads recently that are potentially interesting. But they belong elsewhere.Because EAA related topics don't seem to generate much interest and participation?

Part of the problem, I think is the fact that most of us have a thinner skin regarding our flying skills and construction ability than we do our politics. You can post a story about a close call, where you really did handle it correctly, and some dip**** will claim "YOU VIOLATED FAR XXXXX AND THUS ARE A PEA-BRAINED IDIOT!"

On the other hand, in my experience, most people who bring up Politics WANT a fight. They're troll-bait.

Bill's original start to this thread was due to honest curiosity, but it leaves things wide open for others to start laying blame on particular parties or politicians.


It's really important to understand the ramifications of any international trade agreement not only as Americans but as pilots as well.

The problem is, this is sort of thing can be used to justify discussion of ANY Subject:

"The current child-support mess I'm in could happen to ANY pilot!"

"Selling Amway products will give you more money to support your flying!"

"As soon as generous persons like you help pay his bail, Prince Ngatu will revitalize General Aviation in Nigeria!"

"These pictures of nekkid women will exercise your heart, and help you pass your next medical!" (maybe not, but what the heck)

Back a hundred years ago, when officers were declared gentlemen upon the granting of their commissions, their informal meeting places (Officer's club, wardroom, etc.) had one basic rule: No discussions of politics, religion, or women. It's still not a bad rule. There are thousands of sites to discuss politics, there are hundreds of thousands of sites to discuss religion, and, gawd knows, millions of places to discuss women. You can count decent sites dedicated to general homebuilding topics on the fingers of one hand.

So... the basic problem, I think, is people are bored. There aren't enough discussions going on. The solution to that is to START one!

Don't make me post another headset story! :-)

Ron "And I solder this wire over here...." Wanttaja

[Bob Dingley]

Why is this on the EAA's discussion forum? There have been several similar threads recently that are potentially interesting. But they belong elsewhere.
Roger that, Kyle.
In that vein, I submit that FAA has (again) approved a TURKEY DROP someplace in Arkansas. First we must make a deal with Ankara to import more birds.

[Bill Greenwood]

I have specifically asked all here not to make this about anyones politics.
Some of these agreements go back decades and do not represent one side.
And anyone who claims that these agreements are all bad/ all good or who gives the credit/blame to one side is probably not being accurate.
Let us say someone asked about pro/con of electric airplane engines. One can point out that they are under development, seem clean, but still electicy or batteries have to be manufactured somewhere..
Its not necessary to discuss any political side who is pro or con on these, or perhaps diesel engines.
We could have a topic about flying into Cuba, was an Osh lecture, and ( lots of airports, avgas only at two, lots of poor hotels, people friendly to Americans,) etc. No one needs to point out which party or candidates are pro/con on Cuba travel.
You could discuss ADS-B , certainly a political program, but dont need to talk about any party or candidate to cover the tech facts like costs etc.

[rwanttaja]

Roger that, Kyle.
In that vein, I submit that FAA has (again) approved a TURKEY DROP someplace in Arkansas. First we must make a deal with Ankara to import more birds.
Thank you for clarifying that. I heard it was a "TURNKEY" drop, and wondered, "Do they have too many prison guards in Arkansas?"

Ron "Cheap Jokes-R-Us" Wanttaja

[Kyle Boatright]

I have specifically asked all here not to make this about anyones politics.
Some of these agreements go back decades and do not represent one side.
And anyone who claims that these agreements are all bad/ all good or who gives the credit/blame to one side is probably not being accurate.
Let us say someone asked about pro/con of electric airplane engines. One can point out that they are under development, seem clean, but still electicy or batteries have to be manufactured somewhere..
Its not necessary to discuss any political side who is pro or con on these, or perhaps diesel engines.
We could have a topic about flying into Cuba, was an Osh lecture, and ( lots of airports, avgas only at two, lots of poor hotels, people friendly to Americans,) etc. No one needs to point out which party or candidates are pro/con on Cuba travel.
You could discuss ADS-B , certainly a political program, but dont need to talk about any party or candidate to cover the tech facts like costs etc.

These "discussions" inevitably turn political. I've seen it on the Red Board, the Blue Board, the Purple Board, the Warbird Information Exchange, and a dozen other forums where I participate. Most of those forums have completely banned political topics because they inevitably devolve into a brawl, with people taking sides and pigeonholing others simply because they don't share the same political conventions. And then you don't have a nice forum where everyone is there to talk about the supposed subject at hand.

On the other hand, there are plenty of political forums out there. If you want to "poke the bear", go there. I'm sure the folks who want to discuss National Policy and other important subjects will be there, all ready for a Hatfield and McCoy style feud.

Me? I'd rather come to a forum where the topic is airplanes or something aviation related, and where I can escape the stench of politics for a few minutes a day.

And I will add that anyone who has 3 minutes can review the threads you've started in the last month or so. All troll-bait and not appropriate (IMO) for this forum. Rosenburgs? 60 Minutes? Aviation after the election? Amelia Earhart? "Study showing 40 cops guilty of rape".

[dougbush]

International trade agreements could be good or bad, depending on what's in them. Free trade is generally good for all participating countries, because more competition leads to better prices, better products, more specialization, better productivity, and greater wealth. For example, oranges grow better in Florida and cherries grow better in Michigan, so Floridians and Michiganders are better off if they can trade freely.

Free trade can cause disruptions when one country has an abundance of low skilled workers willing to work for low wages. They compete for work with Americans who can't or won't develop high-paying skills.

But the main problem is these agreements can contain ANYTHING unrelated to free trade, and if we are not allowed to know what's in them, I assume it's bad.

[dougbush]

BTW, Bill Greenwood, alas, there is no unbiased, omniscient authority to which we can refer for "fact checking." The so-called fact checkers are people with an agenda trying to profit by criticizing those with whom they disagree. Here's how they do it:

Suppose you said, "It's a beautiful day!" Fact checker searches for someone to contradict you, and cites "BBC reported five people died in a flash flood in Indonesia that day." Fact checker rates your statement as Mostly False. Fact checker does the same with seven other carefully selected quotes from you, plus two that he agrees with, and publishes his blog saying that 80% of your claims are lies.

[Frank Giger]

Meh.

The executive is overstated when it comes to international trade, as they can sweeten or poison deals that are started, but in the end it's big corporations that are already international and legislatures that do the heavy lifting in that realm.

That's the whole debate about "fast track" authority to the President when doing deals. What "fast track" means is that Congress is telling him to assemble a team, negotiate the best deal he can, and when he comes back they'll put it to an up-or-down vote without modification to the terms. In reality it means that the President is keen to inform Congressional leadership on both sides what the deal is shaping up to look like and ensure there are no serious deal stoppers when he gets back.

The State Department might be paying for the plane to Country X to get the Boeing, Cessna, and other aviation execs there, but it was a Senator that handed them the manifest for the flight. And the bulk of the deal has already been done in the months of lobbying by corporations in the other country. Boeing doesn't wait for government to start a deal for the purchase of airliners by Saudi Arabia or Japan or Wherever; they're just want a nice photo op and a public announcement to help seal the deal and appeal to their share holders.

There is only one world leader who has absolute control on international trade in and out of his country, and last I checked North Korea ain't doing so hot.

[addendum]

For all the doom-and-gloom apocalyptic predictions about our country if X wins or Y wins in the election, let's all take a deep breath for a second. Every nation and person who has predicted the decline and fall of the USA has been proven wrong in a spectacular fashion. We are made from discord, designed for discord, and thrive because of our discord. We are great because we're always one election/event/war/treaty from disaster. As a nation we learn (slowly), adapt (usually through wild swings that slowly come to a middle), and grow (in fits and starts, unequally, until a new and better balance is achieved), only to repeat the process.

Frank "Canada is too cold" Giger

[rwanttaja]

For all the doom-and-gloom apocalyptic predictions about our country if X wins or Y wins in the election, let's all take a deep breath for a second. Every nation and person who has predicted the decline and fall of the USA has been proven wrong in a spectacular fashion. We are made from discord, designed for discord, and thrive because of our discord. We are great because we're always one election/event/war/treaty from disaster. As a nation we learn (slowly), adapt (usually through wild swings that slowly come to a middle), and grow (in fits and starts, unequally, until a new and better balance is achieved), only to repeat the process.

Frank "Canada is too cold" Giger

In my opinion, bureaucratic inertia is so high that the person at the top has less influence than people think. A few hot-button ideas might get more attention, but for the most part, peoples' lives aren't going to change much. Let's not forget Congress, too...as much as we would like to. There's rarely a consensus, even within parties, so when the Executive and Legislative branches are the same parties, there's enough fractures to prevent things from getting railroaded through.

Congress needs to stop surrendering its power to the Executive branch, though. Most of us were probably old enough to remember the post-Vietnam limitations placed on the President to keep him (or her) from taking the country to war on their own. Congress has basically given up its power in that regard...don't want to be on the record as voting for (or against) a military action. Gosh, that might affect their re-election chances!

Ron "South America stole our name" Wanttaja

[dougbush]

We... thrive because of our discord.
How can discord lead to thriving?


We are great because we're always one election/event/war/treaty from disaster.
How does proximity to disaster lead to greatness?


As a nation we learn (slowly), adapt (usually through wild swings that slowly come to a middle), and grow (in fits and starts, unequally, until a new and better balance is achieved), only to repeat the process.
A better balance of what?

[DaleB]

5879


:)

There is something to be said for the healthy competition between ideas. I think we may be a little farther down that road than is really healthy, but I suppose we've been there before.

[Mayhemxpc]

Oh, this is going to be fun! Especially the effort to keep this relevant to the forum...

Yes, everyone is right. All posters have valid points. In no particular order...

1. Some EAA topic generate lots of interest and participation. These are generally shut down by the moderator, and often for good reason.

2. Free trade is especially important to aircraft owners, operators, and even builders. (If my wife ever lets me, I intend on building an Italian kit plane. The One week Wonder last year sparked my interest and fueled my fantasy that I really could build something.) At a higher level, it is nice to say "if it ain't Boeing, I ain't going" but for that to work, Boeing needs to be able to be competitive in foreign markets.

3. Free trade is best at the national economic level. It forces all players to become more competitive. It also increases the economic health of all participants, making them more likely to buy higher priced American products, if such products have a higher level of quality to justify the price (Mercedes vs Chevrolet...Sorry, Boeing vs Tupolev)

4. Yes, it can really hurt individual businesses and even sectors. No business has a right to success. It can only expect fair competition in that market, and the competition changes. Companies need to adapt. Become better, more efficient, or find new markets and products. Workers need to have other skills than making buggy whips. (Warping wings/hand carved propellers?) Some business will suffer but free trade is best for the economy as a whole.

5. That said...there are limited circumstances where tariffs are necessary as a temporary measure. One is where for national interests you are trying to discourage use of that product. That doesn't work well. It is just a legitimate justification. The other is where a it is determined that a particular business sector is necessary for national economic development or for national security reasons. (Rocket engines?) A government can impose tariffs as a protectionary measure for the time it takes to get that business sector up and running and then remove them as soon as possible. (Yes, I am aware that it takes a Reagan to actually remove a tax once imposed.) When those conditions apply and when they can be removed is a debate for another day -- and may never be resolved to ANYONE's satisfaction.

6. It really isn't that complicated at a macro level. But...taking an analogy from war, Clausewitz wrote that war is really very simple, but in war even the simplest thing is very hard. Kind of like aerodynamics.

[Floatsflyer]

Every nation and person who has predicted the decline and fall of the USA has been proven wrong in a spectacular fashion.

Frank "Canada is too cold" Giger

Hubris and xenophobia strikes again. If you ignore history you are destined to repeat it.

Over the course of only the last 3500 years, the Greek Empire fell, the Roman Empire fell, the Egyptian Empire fell, Troy fell to name but a few. These great civilizations eventually declined as quickly as they rose. So too will the USA, it's not a matter of if but when. Perhaps the events of next Wednesday morning may give us some insight into the timeline.

No need to be concerned with Canada's climate.....they've already built a wall.

[rwanttaja]

No need to be concerned with Canada's climate.....they've already built a wall.

Hmmmm....it's ice, and 500 feet high? Sounds like we're on the wrong side of it!!!

Ron "White Walker" Wanttaja