Will The U.S. Trade War Extend To The Space Sector?
Trump threatens to slap retaliatory tariff on European cars as trade war talk heats up, CNBC
“Trump’s hasty decision to impose tariffs on steel imports has stoked talk of a brewing trade war, roiling both the political establishment and the global economic order. The move also prompted E.U. trade chiefs to weigh hitting a broad array of U.S. imports with a 25 percent tax, Reuters reported this week.”
New Tariffs Could Harm Industry Critical to American Economic Security, Aerospace Industries Association
“Friday morning on CNBC, AIA President and CEO Eric Fanning was featured immediately following Commerce Secretary Wilbur Ross, emphasizing: “This is going to impact companies big and small in the aerospace and defense world. More importantly, we’re concerned about retaliation. The aerospace and defense industry generates the largest net surplus in the manufacturing sector – over $86 billion a year. These companies thrive on the exports of their products.”
Why Europe and Canada may retaliate against bourbon, Harleys and Levi jeans, Washington Post
“Another alternative would be to ban U.S. companies from bidding on Canadian defense and infrastructure contracts, Mendes, the economist, said. The advantage to that approach would be that Canadian consumers wouldn’t feel the impact in their wallets. When Boeing launched a complaint against Bombardier, claiming the Canadian company had benefited from unfair government subsidies in the production of its C Series jet, the Canadian government retaliated by saying it wouldn’t consider buying fighter jets from Boeing. That dispute was effectively settled in January, when the U.S. International Trade Commission voted that Boeing was not harmed by Bombardier.”
Keith’s note: I am waiting to see how the trade war that the White House has started will affect willingness of affected nations to cooperate with U.S. on future human spaceflight and on U.S. commercial space sector – and example of both being the Deep Space Gateway. Protectionism and isolationism do not seem to be synonymous with such an expansive endeavor as the exploration and utilization of space.
US Aluminum production has dropped from 2,070,000 metric tons in 2012 to 740,000 metric tons in 2017. If you don’t think it is important to be able to produce aluminum used in aerospace to protect our strategic interests you do nothing. What would you do if you thought it was important to be able to produce aluminum used in aerospace related products so we wouldn’t be vulnerable to cutoff by our adversaries?
https://www.statista.com/st…
US steel production has done better, but it’s still below the level it was prior to the Obama Administration.
But their defense uses are exactly why the WTO allows exemptions for national security reasons.
Don’t you mean prior to production falling off a freaking cliff under President Bush and right when Obama took office and was 90% recovered in a couple years?
Obama was coming in to office at the bottom .. it actually went up under his watch.. from where it was when he started.
https://uploads.disquscdn.c…
Thanks for illustrating how it never recovered to the levels it was under President Bush. It permanently lost 10% of its workforce under the Obama Administration. You illustrate well how the recovery under the Obama Administration was basically limited to Wall Street and Silicon Valley, skipping the rest of America, what the Democrats call “flyover country” as they fly over it in their private jets.
Yet when the Obama Administration tried to help domestic US renewable energy companies, they caught nothing but flack from the Republican opposition. The same Republicans who seem to be hell bent on screaming about coal jobs going away due to over regulation. The reality is that coal jobs are going away due to increased automation in coal mining and production coupled with the impact of cheap domestic natural gas production.
I live in oil “fly-over” country. It has not done much better than coal under Obama. Local real estate investors say that the financial condition of the area (and thus their market), ebbs and flows with whatever party is in the Whitehouse. I suspect that coal does too…for similar reasons.
With oil, Dem Presidents appoint environmentalists to positions of power over the issuance of drilling permits on public lands and the number of those permits falls precipitously, putting this “fly-over country” into a localized recession. The recession ends a couple of years after a Rep Prez gets elected and appoints oil-friendly folks to those positions.
The price of energy derived from various sources has far more effect than WH. As far as environmentalist are concerned: everybody plays by the same rules. And we live in much healthier environment.
No, China, Russia, Saudi Arabia don’t play by the same environmental rules. And they laugh when we handcuff ourselves with strict rules, or by putting huge parts of the nation off limits to mining and energy as the Obama Administration did.
Ok, ok, ok. Of course you are right. Not sure where my brain was.
And who cares if they laugh? Let them eat sand!
Unfortunately, in Beijing, that laugh has good odds of ending up as a cough. Air pollution is a bit of a problem there.
Globally speaking, yes. Locally, here in Evanston Wyoming, the oil companies hire and fire in proportion to the drilling permits, which swing wildly from somewhere around “drill drill drill” to something like “go away and find something else to do for a living”. People come here and buy up every house in sight, drive up the price of housing to beyond laughable, and spend money like it was water. Then the WH flips and they end up walking away from home and mortgage. Yes, yes the low price of oil is slowing down the come back this time, and there is other work here besides just oil, but even with all of that there has still been a noticeable difference in the available labor force and the liquidity of real estate since Nov. 2016.
The price of oil will impact the profitability of the operating wells, and they might have to shut them off and cap them, but I guess with these small wells out here they just drill when they can and stop drilling when they can’t.
Yes, they area where I live in SW Texas is just coming to life again after the Obama Administration threw the economy into an eight year recession. Here an entrepreneur explains why it is finally returning…
https://www.reviewjournal.c…
COMMENTARY: Donald Trump unleashes the economy by dismantling the Obama regulatory state
“As terrible as taxes are, there is an invisible burden that is much worse for business. It’s the regulatory state. It’s not a sexy topic, so it’s rarely in the media headlines. No one talks about it. But when regulations are heavy, business is strangled and suffocated. Middle-class jobs vanish. No one wants to risk, invest or create a quality job.”
“No business owner, entrepreneurial idea man or investor can survive in an environment like this. So, like so many millions of other businessmen in the Obama era, I stopped opening businesses. I stopped investing. I stopped raising money. I raised about $20 million for various businesses under President George W. Bush. I didn’t raise $1 in eight years of Obama. Regulations and lawyers killed the fun, killed my entrepreneurial spirit, killed the risk-reward ratio.”
And to return this to space, its no accident that the FIRST thing the National Space Council looked at was the regulations that govern space commerce. They know fixing it is FAR more important than anything involving NASA.
and of course the freedom caucus and Mitch McConnell were bending over backwards to recover to .. I mean .. nothing says support than the conservative republicans adopting a no honeymoon policy and voted NO on everything .. the house is burning down and they commit to voting no even on legislation they support and propose… nothing says support then a record shattering 500 filibusters .
Your constant ignoring of history is truely remarkable
“TIME just published “The Party of No,” an article adapted from my new book, The New New Deal: The Hidden Story of Change in the Obama Era. It reveals some of my reporting on the Republican plot to obstruct President Obama before he even took office, including secret meetings led by House GOP whip Eric Cantor (in December 2008) and Senate minority leader Mitch McConnell (in early January 2009) in which they laid out their daring (though cynical and political) no-honeymoon strategy of all-out resistance to a popular President-elect during an economic emergency. “If he was for it,” former Ohio Senator George Voinovich explained, “we had to be against it.””
http://swampland.time.com/2…
https://uploads.disquscdn.c…
Yes, the party of no. No, we won’t let you export jobs to Europe because they need help. No, we won’t let you gut domestic oil production with new regulations. No, we won’t let you put Americans out of work so you may brag about a trade deal with some foreign nation. No, we won’t let you use the emergency to promote socialist solutions. 🙂
It’s not ignoring it. It’s just how the rest of America sees the history of the Administration that killed Project Constellation and gutted astronomy at NASA. There are many reasons the election of Barack Obama as President divided the nation.
BTW here’s a link to an article that shows just how much the Obama Administration was able to damage the economy despite Republicans in Congress fighting for it. It’s from Oct. 2016.
https://www.investors.com/p…
“In a recent study, the Government Accountability Office found that the four administrations before Obama averaged about 1.6 major new rules per year. Under Obama, that’s jumped to three. No wonder the economy’s still crawling at a less than 2% growth rate, instead of the robust 3%-plus ratof earlier administrations.
Regulation of the U.S. economy — in particular regulation in which costs far exceed the benefits — has become a major hindrance to our prosperity. According to the Cato Institute the total economic cost of regulation is now about $2 trillion a year — more than 11% of GDP. How can our economy fly when it has so much dead weight?”
Here’s a longer view of US Steel Production. After the decline during the end of President Carter’s term, it shows a steady increase. After the last recession, it recovered some but seems to be showing signs of decline.
https://uploads.disquscdn.c…
Oh no! Not actual facts!
I don’t suppose you know where to find longer term data. The tariffs are authorized under a national security provision, and that reminded me of one of the United State’s main contributions to winning the Second World War: Our local economy could significantly overproduce other countries when it came to war material like steel for tanks and ships. I thought that was still the case as late as 1970, but the plot you show implies otherwise. Do you know when the US became a net importer of steel or aluminum?
I don’t know if you are a geologist or not but understanding Aluminum production starts the with mining of Bauxite and thus there are deeper reasons for the changes. Everyone just goes to the top level stories and “statistics’ without ever researching or understanding the whole picture.
https://minerals.usgs.gov/m…
I do know that we use very little domestic production of bauxite for our production of aluminum and haven’t in a long time. We import bauxite from Jamaica, Brazil and other places for our production of aluminum at prices everyone else supposedly is paying as a global commodity. Other countries including China, subsidize their suppliers until competitors are weakened or go out of business to buy market share. They do that in a number of industries. .
Some data points since I expect most folks here know little about the non-space economy.
Autos that are made in the U.S. and sold in the EU must pay a 10% EU Tariff. Autos made in the EU and sold in the U.S. must only pay a 2.5% Tariff. So after years of trying to get the Europeans to embrace free trade and lower their Tariff we decide to increase our auto Tariff. The Europeans, used to dumping cars here are now mad. So what? They had their chance to embrace free trade and open their markets to the U.S. and refused.
It’s no different than Germany refusing to honor the NATO Treaty and committ 2% of their GDP to defense. Instead they just dump the burden on the U.S. and drive around in tanks with pieces of wood painted to look like machine guns while all 6 of their subs are stuck in port waiting for repairs.
Isn’t some of that offset by the cars that are built here, which provide high-paying jobs for many Americans on this side of the Atlantic? Ask those folks in Greenville, SC or Vance, AL about this before we just start slapping tariffs on things to satisfy the rabid base.
Like the Japanese they use the construction of plants here as a bargaining chip so they get to keep their high tariffs and keep harming American firms.
BTW according to economic theory, if we raise tariffs they should expand those plants to avoid paying the tariff, so it will create more jobs in the USA.
It’s only a burden if you accept that:
A) Defence spending harms the economy.
B) The US would reduce defence spending if Germany increases theirs.
Since the same idiots who screech about the horrible Euros living off the back of Uncle Sam also scream bloody-murder whenever anyone suggests reducing US defence spending, that suggests they utterly reject both A & B. Therefore no-one is “dumping the burden on the US” except the US politicians who insist on high defence spending.
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To borrow a little Tom Sawyer…
Brothers, Li’l Reg and Li’l Doug are painting a fence. Reg notices Li’l Hans playing with his building blocks and gets angry, “Why should we have to paint the whole fence while Hans can play with his blocks?!” Doug doesn’t agree with Reg on most things, but the principle is fair, so he tentatively agrees.
Reluctantly (people hardly come into this area any more, so Hans doesn’t think the fence needs to be painted quite as often), for the sake of his friendship with the brothers, Hans agrees and they shake hands on it. Hans and his siblings will paint half the fence.
Hans, “So which half of the fence will you paint?”
Reg, “No, we’re still painting the whole fence.”
Doug, “What?!”
Hans, “Why?!”
Doug, “No, Reg, we only need to paint half as much. Then we can spend more time playing.”
Reg, outraged, “What are you, a communist? How dare you suggest we paint one-inch less than the entire fence!”
Doug, “But you said…”
Reg, “Communist!”
Later, Reg notices that Hans has gone back to playing with his blocks and gets angry, “Why should we have to paint the whole fence while Hans can play with his blocks?!”
And just because…
The Ants And The Grasshopper.
Two ants, an elephant ant and a donkey ant, worked all year collecting seeds to store in their ant-nest. Meanwhile, the European grasshopper sung and played.
Come winter, the ants ate only part of their stores, leaving plenty for the grasshopper. The elephant ant was outraged, “How dare you benefit from the sweat of our toil!”
The grasshopper frowned, “But you weren’t going to eat these seeds, they were going to waste. There’s no extra burden on you if I eat your excess, if you chose to collect too much.”
But the donkey ant also agreed, why if they hadn’t collected so many seeds, they could have fixed up the nest before winter hit; it was falling apart, leaking, etc, you know basic infrastructure issues.
“Fine,” said the grasshopper, “I’ll collect my own seeds next year.”
Next year, when the elephant ant and the donkey ant had collected enough seeds to last the winter, the donkey ant said, “Good, now we can stop collecting seeds and start fixing the nest before winter hits.”
The elephant ant was outraged, “How dare you suggest we stop collecting seeds! Are you a communist? I demand that we collect exactly as many seeds as we collected last year… No, actually, we should collect even more!”
The donkey ant sputtered, “But, but…” while the elephant ant screeched, “Communist!”
And seeing this, the grasshopper stopped collecting seeds and went back to singing and playing. And come winter, when the grasshopper again ate the ridiculous excess of seeds collected by the ants, the elephant ant screeched, “How dare you benefit from the sweat of our toil!”
The EU has destroyed the Scottish steel industry in the 1990s they demanded the UK cut steel production so Ravenscraig was closed , our Fishing industry in Scotland has been destroyed by the EU as was the Scottish Car industry when Chrysler sold out to Pergout under new single market EU rules the Job’s transfer’d to EU my Father never worked again. wish we had someone like your President to stand up for Scotland !
Yes, the UK should have never joined the EU. As soon as the exit they will be able to create a free trade agrement with the U.S. that should extend to their space industry.
That sounds consistent with Trumps stated preference for lateral agreements over unilateral ones.
As for space tech, I’m not sure tariffs make that big a difference in a near monopoly. SpaceX has most of the new U.S. business and Arianspace has most of the EU business already. A tit for tat 25% tariff shouldn’t change that much. Help Arian hold onto their business a little bit easier i suppose.
Yes, allow them time to adjust to the new launch world. In terms of partnerships they never contribute at the level they could afford so I suppose they will continue to freeload.
For example ESA and Japan just signed an agreement to build the LOP-G. Together their combined GDPs are much higher than the US. But will they contribute the bulk of the $30-40 billion it will cost? No, they will probably contribute about 5% or so and leave NASA, and American Taxpayers, to pay for 80%-90% of it like the ISS.
In fact space is one of the biggest winners of the decision to quit the EU it’s forced the government to invest in space to the extent we have leep frogged Italy into third place for funding. we have just built the biggest satellite processing facility in Europe at Harwell.
I think the timing there is a bit off. If memory serves, the increase in UK space funding started a year or two before the vote to leave the EU.
But you are right about the UK moving forward, and not just with government-funded projects. Clyde Space is picking up the Glasgow tradition of building long-range vehicles (although they were recently bought out by AAC Microtec of Sweden, the work is still being done within walking distance of the Clyde.) Surrey Space Technology is also doing great work in the small satellite field.
I understand, many of mine walked the same road, but you may be tilting at windmills here: Steel, car, shipbuilding (The UK is an an island in the midst of one of the busiest sea lanes, for goodness sake), aviation, mining, nuclear industry, railway and host of other strategic heavy industries, all thrashed in the UK in the late 70’s and 80’s. True this aligns with the UK entry into the EC however, and this is the key, all those sectors thrive elsewhere in the EU. Correlation is not necessarily causation. That sounds more like national policy and leadership issues than explicit EC/EU interference. There is a space factor here: The UK is unique in being the only country that developed space access then gave it up. Not only that but declined to join the ‘European’ (not EC/EU) project for access after giving them the seed technology it had developed (No UK flag on the Arianes). It’s all of a theme here. I guess we will see soon enough if it was the EU after all.
The UK is now a major player in the European Space Agency , the current Government has increased funding and for the first time we are part of the ESA Human Space flight program Tim Peek flew in 2016 and is due to go again possibly next year . we have put a small amount of funding into ISS and Orion .
The UK has always been a major player. Usually trading third place with Italy. ESA has mandatory and voluntary budget lines. ISS and Launchers are voluntary. The UK has never elected to contribute to them until the recent contribution to the ISS. FWIW the UK are now happily going their own way on launchers anyway and in time may be able to realise a real cost effective option for European space access. Just not in the near term.
UK used to be active participant in ESA (Spacelab patch from the days had a Union Jack flag) then they pulled out. And no UK astronauts. In 1960s UK had launch vehicles, US said “our Scout rocket is available for your use” which prompted UK to cancel their rocket program (and US raised Scout prices). UK had several automobile companies, all gone, which someone posted during 1980s Thatcher did not offer govt assistance to their car companies (other European govts assisted their car companies when going through economic pains). Foreign companies came in and bought out those UK car companies.
I heard someone commented during the days where the sun never sets on the British Empire, too many goods were being produced so they backed off on industrial production. And China is about at that same point. I’m not clear on this history (and not that knowledgable of UK, GB, England) but how sustainable are “empires?” Looking at NASA where a time when budgets were much higher, in other words a much stronger industrial base.
Taxes are being cut here and there, both sides make up losses with tariff taxes?
You have focused on a very large issue, one that will become central in the next 20 years: will the US move away from taking care of our citizens, or we continue to allow the rich to get richer and richer?
Tax cuts by the Republicans are done for one reason: to justify cuts to social programs. All the rest – including the silly notion that lower rates means higher revenue – all for hose discussions are simply meant to distract the public.
Let’s add some science to that statement…
https://www.nature.com/news…
Income inequality is cyclical
Branko Milanovic
21 September 2016
“Periodic rises and falls in the gap between the rich and poor over centuries indicate that inequality will not grow forever, argues Branko Milanovic.”
So this is nothing new nor worrisome, its just a result of folks making money from the recent wave of new technology. And as is normal, its not hidden in mattresses, but is either invested in social causes or science (Andrew Carnegie, Bill Gates, Paul Allen…) or in new high risk industries (Howard Hughes, Elon Musk, Jeff Bezos,) that generate higher levels of economic activity. Eventually the industries mature and the income is more evenly distributed.
Tell me, what do you prefer, Eon Musk investing his huge profits in SpaceX? Or the government taxing it at 90% as it did in the 1950’s and giving a percentage of the money to NASA to spend? Which do you think will make America better off?
Though tax rate was 90% but ***nobody*** paid 90% taxes, there were loopholes. But regarding higher tax rates in 1950s, you can get a job of livable wage out of high school at North American, Consolidated, Grumman, Northrop, Douglas, etc. Get tech training or a degree (when college education will not put you in a financial hole) and earn even more.
Though new technologies are being created, but will the masses be part of it?
There are still jobs like that in the mining industry in Nevada. High School seniors take a year of community college and start making in the 70’s with no student loans.
The masses will be part of it when High School teach the skills they did years ago.
There are many good paying jobs which only require an apprenticeship, trade school or Associates, but they go begging. The problem is an over-promotion of “college” and easy loans to marginal students cause them to choose unwisely.
Yes, and lots of those mining jobs go begging as well. College is not for everyone and I say that as a University Professor.
However, effective tax rates were in the 50% for people in the top 1% of income earners. Now it’s around 16%.
(Is the average American now 3 times better off thanks to this modern largess?)
Compared to the average American in the 1950’s when most families had a single car, a phone hard wired into a wall and a B&W TV? What do you think?
That the average American family’s share of both the national income and national wealth has been falling for 40 years. That the median wage in both constant dollar and PPP terms has been flat or falling for 40 years.
And yet America still beats the rest of the world…
http://www.pewresearch.org/…
“The U.S. stands head and shoulders above the rest of the world. More than half (56%) of Americans were high income by the global standard, living on more than $50 per day in
2011, the latest year that could be analyzed with the available data. Another 32% were upper-middle income. In other words, almost nine-in-ten Americans had a standard of living that was above the global middle-income standard. Only 7% of people in the U.S. were middle income, 3% were low income and 2% were poor.”
Also keep in mind its not just how much you make, but what you are able to buy with it. In terms of the hours spent to buy the gasoline needed to drive 100 miles it has fallen greatly.
http://www.businessinsider….
“It’s currently 27.2 minutes of work, the lowest since 1999. By Perry’s estimate, a further 26 cents decline (to $2.10) in the price of gas per gallon would be the cheapest in history, adjusted for fuel use and wages.”
The same is true across the board on what Americans buy. So the money goes much further.
http://www.thepeoplehistory…
In looking at this remember what a house, and car, was in 1930 compared to today.
The vast majority of Americans have a smaller and smaller share of their nation. That has consequences. You can twist around and try to explain it away, but that’s what is.
You just don’t understand the economic cycle. When the railroads came about huge fortunes were made and you had a concentration of wealth. And what happen to it? Large observatories like Mt. Wilson and Mt. Palomar were built, museums, Carnegie Libraries, etc. and the kids just spent it. It’s not like Scoorge McDuck where they hide it in a money bid. Do you think universities like CalTech or Stanford could have been created by a million individuals donating $10 each? Or $10 per person provide the capital for low return investments like aviation or rockets.
And the result is the disparity decreases. Then a new wave produces a new wave of disparity, next was automobiles. And then it’s dispersed. It’s one of the strengths of a free market society, folks get rich and then spend the money on things that the government would never fund, things that benefit everyone. It’s one of the reasons the American economy will never be beat.
and how much of that was considered almost a luxury good as compared to today?
They also had a pension, a union job, a wife staying at home, and regular vacations.
Dr. M: As a learned man you know better than to offer a false dichotomy.
And I will add this: Yes, one can show that income disparity is cyclical, a fact that colors the point not one wit. Income disparity is the single biggest issue threatening our country.
And exactly how is it threatening the country? I see lots of hand waving but no real economic based arguments. There is a reason innovation from firms like SpaceX and Blue Origin occur in the United States and not countries like Sweden where there is less income disparity.
Income disparity is threatening the country because many people don’t like it, and they might do something about it.
That was a concern an hundred and fifty years ago, when labor violence could have become a very, very serious problem. I personally think trade unions helped release some of that pressure and prevent socialist revolution in many nations.
Or, more likely today, people might get so sick of earning $50,000 a year when the big boss makes that much in a few hours. Then they might vote for some a politician with a truly stupid promise to change things.
The amount the boss makes is annoying, but Americans are convinced that they should get whatever they can get.
Again, our friends on the right have been successfully hammering that issue for decades.
That’s what worries me. Americans have been trying to vote for an “outsider” to change things, and just seen more-of-the-same. So the hunt for an acceptable “outsider” have become more and more extreme.
Americans voted for Clinton (who was then a political outsider), to try to change things. (His schtick was parodied as “I feel your pain.”) People were dissatisfied with him, so turned Congress against him; but when the Republicans put up a pure insider against him, they re-elected him.
Then they rejected Gore, and insider, and swung to GWB, who was “like them” (or pretended to be), outside of Washington in spite of his family dynasty. At least, he wasn’t a too-clever intellectual like Clinton and Gore.
When that killed the economy, they went for Obama, a political outsider, a “clean skin”. When it didn’t help, they swung Congress in the mid-terms.
During the Republican primary in Obama’s second term, many Republican voters kept pushing anyone but Romney. But each alternative candidate fizzled into incompetence. So they stayed home in November and Obama won again.
You saw the same process in 2016. Voters on both sides wanted anyone but a mainstream candidate. Clinton overcame that in the primaries. But Trump rode it in both.
[In this, the Republican base is more radicalised than the Dems. Being drawn from areas that have been hardest hit by (ironically) Republican economics and Dem failures, and deliberately stirred up by right-wing news networks (fear and hate makes a reliable audience.) But the left voters are heading in the same direction.]
When Trump merely makes things worse, what will voters turn to next? How radical do you have to go to find someone more “outside” than Trump?
The same thing happened in Russia in the 19 teens. And in Europe and US in the ’30s. In Europe it led to fascism. In the US, democracy was saved thanks to FDR’s radical economic changes.
But I don’t see a modern FDR. I don’t even see a basic realisation amongst mainstream politicians that there’s a crisis approaching. I do, however, see the equivalent of the German aristos in the ’30s who thought they could ride the civil unrest into more wealth/power, and I do see wannabe Hitlers/Lenins/Stalins who do see the level of unrest.
Income disparity led us to the current WH occupant, as one simple example. The issue is far from simple and the results are difficult to predict.
A far-left candidate hasn’t been popular (yet) mostly because the right has been so effective for so long in raising the Big Government bogeyman (all the while insidiously peeling away privacy).
I think there is already a trade war ongoing in the space sector, but it has little to do with foreign and domestic. It is all about the cost of doing business and the war is New space versus US government/contractor. In case you have not noticed, New space is winning. It is all about progress in technical accomplishments versus costs and spending. New space is spending far less and accomplishing far more.
In US versus the world in human space, I recently saw the Italian film ‘Expedition’, about the ISS. The Italians take a lot of pride, they said, in having built most of the ISS manned elements. In fact essentially they said they have taken over the building of the manned elements for the world. The Italians boasted that for Italy it is a new industry, which I read their statements to mean that the US gave up and the Italians gained.
Let’s not take out eyes off the small balls in play : Strategic metals and Rare Earths.
Those scenes of a SpaceX second stage Merlin E engine blazing away in the vaccuum of space show us a rocket nozzle made almost entirely of Niobium , a metal produced almost entirely in Canada and Brazil. The USA has only one domestic source of industrially and strategically important platinum and palladium, a single mine in Montana that until recently was owned by Russians and now owned by a South African company . Rare Earth mines in the US ? Count ’em on one or two fingers. Where does tanatalum come from ? — Brazil again , Australia, and the sh_thole region around Congo. The metal vanadium is absolutely essential to aerospace and specialty steel industries, but can be obtained in industrial quantities only from Brazil, Russia, China, and South Africa. Need a boatload of critical titanium ? —you’ll have to get it from Japan, Russia, South Africa or the sh_thole of Sierra Leone, or Australia. Lithium metal is now as important to the American consumer as oxygen and running water, but US sources are minor, and most lithium is imported from Chile, Bolivia, and Argentina or China or Australia. Got gallium ? Tellurium ? Yada yada.
Dear Trump supporter , Pentagon procurement officer, aerospace mogul or more sundry über-capitalist , the bulk of Periodic Table should very much concern you more this week than last week. On the hot button topics of the commidities steel and aluminum , the US has some iron ore and thermal coal to smelt it but is dreadfully deficient of aluminum ore ( bauxite ). Be careful what you demand Mr. Trump. You are sorely in need of some global economic enlightenment that extends far beyond hotel suites and golf courses… your precious Tweeting device depends on having a free flowing supply of many strategic metals not found or produced in Red States .
A tariff is a tax on imports, not exports so a trade war won’t impact the flow of those strategic metals into the United States. Nations usually don’t tax exports when they are commodity producers.
And the reduction on environmental regulation will likely create more domestic sources. For example, a reduction in regulation is allowing a Rare Earth mine near Las Vegas to expand. It will also encourage U.S. firms to start prospecting again.
But you also make a good case for space mining, especially for Rare Earths and Titanium which is abundant on the Moon.
Mining titanium on the moon to serve markets here on Earth is a ludicrous idea. Purified titanium dioxide is selling for maybe $1.50/lb.
You completely missed the elemental point : Retaliations . If Trump’s follows thru on his initial unilateral tariff scheme, retaliations are inevitable on the two way street of trade, even if it’s instigated only against steel and aluminum. Trump has so aggravated , annoyed, and cast aspersions against most of the planet that it will have direct economic consequences. The EU has already said plainly they will put tariffs on imported Harley Davidson motorcycles made in Wisconsin to get Paul Ryan’s attention , and imported Kentucky bourbon to get Mitch McConnell’s undivided. For starters. Trump needs to be taken to the woodshed for some Global Trade 101 lessons with a nice imported Italian black leather strap across his posterior , forthwith . P.S. his firm got kicked out of the big Trump hotel in Panama City , Panama today and they took the Trump name off the building. great spot news photos of that…
The EU is a lot more dependent on exports than the U.S. is and already has high Tariff walls in many areas, so they are in a weak position for a trade war, which is why they made such poor choices, luxury goods most in the EU are not able to afford anyway. It would be too easy for the U.S. to retaliate with high Tariffs on Champagne and German Beer.
And unlike the U.S., the EU risks internal fragmentation if they destroy America markets important to individual members. In case you haven’t notice the anti-EU parties in Italy just had huge gains in the last elections. A Tariff that impacts their car industry would make an Italian exist from the EU even more likely.
German beer falls into the unspecified 5.7% of total exports so it really is not a big thing. Germany exported 1.32 trillion with 118 billion going to the US which is less than 10% of their exports. The question is strategic minerals versus beer …. which will hurt the US more …. less beer or less rare earths?
https://atlas.media.mit.edu…
But Rare Earths don’t come from Germany and there is no Tariff on them.
That’s not quite a fair description of the Italian election. The main Euro-sceptic party, the Five Star Movement, did do well. But it only got 32% of the vote.
Depending on how you count the right-center and center-left coalition parties, there were either seven or fourteen parties running. Five Star won the second most votes. But the other six (or thirteen) parties are largely pro-EU.
The same is true of the recent German and French elections. The Euro-sceptic parties did better than in past elections, but their success wasn’t as great is it seems. The pro-Euro vote was a strong majority but split between several different parties. That’s hard for Americans to appreciate, since we’ve got a essentially two-party system, and most European countries have five or six major parties.
It’s similar here in America, where the elected political body and the views of citizens aren’t exactly congruent, largely due to safe seats in the House.
Actually, it’s a bit different since we have a strong two-party system. Even if the elected officials fully represented the views of their constituents, having more than two parties would make things different.
Imagine something totally implausible for American politics: A third party with a large number of votes in the House of Representatives. Let’s say the Green Party managed to get enough people elected to control 25% of the vote in the House. (This is a hypothetical example, so don’t tell me about how unrealistic it is…) And the Democratic Party had 35% of the votes, and the Republicans the remaining 40%.
In that imaginary case, you could honestly say the largest party in the House was in favor of opening public lands to mining and oil drilling. That would be completely true, since the Republican party does favor that and (in this hypothetical example, they are the largest party in the House.) But that wouldn’t mean all that much. The Greens and Democrats would, between them, have 60% of the votes, and they wouldn’t be for it.
That’s more of the way many European governments work. The largest party in a legislature might be Euro-sceptic. But it isn’t the majority party. It might have 32% of the votes, and no other party has more. But the other parties are all pro-EU and, in cooperation, they have a majority coalition.