17 Jul 2018

Trump, the Mercantilist.

I was struck by a economics blog post: [US] Corporations and mainstream media trumpet the “horrors” of higher wages.

Whatever else he is, Trump is a mercantilist

"Mercantilism states that a country will grow richer by increasing its net exports. To achieve this goal, the original mercantilist writers recommended that wages be kept at the subsistence level, not just to minimise the direct cost of labour, but also to maximise the pressure on workers to work. They believed that workers were lazy and had to be coerced to work." - Prof. David Spencer. Six Centuries of Vilifying the Poor.

Trump is desperate to increase America's net exports. The USA imports a lot more from Russia, to take a topical example, than it exports to Russia. Hence the trade war and hence the pressure on US wages, though not CEOs salaries, because mercantilists are willing to pay top dollar to anyone who can squeeze more work out of fewer workers at lower pay.

If Europe, Russia, and China mounted a coordinated response to Trumps's trade war, he'd be in deep trouble. Now we see why he's going around stirring up trouble between us.

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Keep is seemly & on-topic. Thanks.