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For a thorough economic analysis, I recommend Patrick Boyle. The gist is that tariffs are redistributive: They take income from the household sector and transfer it to protected businesses — both within the US. Whether Canada will be thrown into a recession depends on how badly Canadian goods are demanded by US consumers.
The basic economic incentive for international trade is the same why we have different professions for people: by dividing labor, countries can specialize and be more efficient in producing particular good or service, making it cheaper for everyone. Yes, you can grow bananas in Canada, but it's just way cheaper to do it in warm climate. The flip side is that Canada will never gain the expertise needed to grow bananas, and will not have any bananas if the other countries close down shop. This is fine without bananas, but if you replace "banana" with "weapon", then some people start worrying about "natural security".
This is not directly related to your questions — but I'm genuinely curious. How would you describe the harm that the left has done to you and your loved ones, and how would you say the mainstream media misrepresents Trump?
The reason why I'm asking is that I'm firmly anti-Trump — I have no hate for him, but I do believe that he will make the lives of almost everyone worse, including his own supporters, except for the direct beneficiaries of his authoritarian rule.
And I'm bringing this up with you because I'm curious why his own supporters would support him, even though he will harm them. Obviously, that doesn't make sense to me. 😅
Before I expand on that, I'd like to expound that my core value systems is humanism — essential, every human being is worth caring for. That includes you, every Trump supporter, all leftists, and people of all colors. However, it appears to me that Trump supporters do not necessarily see it the same way, and then it becomes a question of how much care I can afford for a human that is fine with harming me.
Now my quick rundown of Trump: The key tactic of populist figures is to deceive about the actual benefit of their policies. Will Trumps' tarrifs improve the lives of most American consumers? Judging by argument above, the answer is "no". Does Trump care? The answer is — "no". Why would he care? Why would he not lie to everyone? His good character? But he doesn't seem to have a good character? And will people be able to tell the difference? The answer is "no" — that's why the deception works. Most people do not understand well enough what effect tariffs have — and they will harm themselves if they belief they work while the reality is that they don't. It's the discrepancy between belief and reality that is the source of harm. And the populist strategy is to play exactly that: Tell people what they want to believe, reinforce it, throw new beliefs at the wall and see what sticks, without any regard for reality. Everyone who is in on that deception will win, everyone who is not will lose out.
As Henry George put it in his 1879 book "Progress and Poverty":
“A theory that, falling in with the habits of thought of the poorer classes, thus justifies the greed of the rich and the selfishness of the powerful, will spread quickly and strike its roots deep. This has been the case with the theory advanced by Malthus.”
I can’t answer for the user you’re replying to, but can for me. The answer is immigration. Until mass immigration ends, immigration is the only issue that matters. Every normal policy can be quickly reversed, but in human history, mass immigration is usually (albeit not always) forever, especially under liberal democracy.
A huge global recession caused by Trump’s tariffs policies would be awful, but the alternative was acquiescing to the most harmful policy of the last 70 years of Western civilization. If my voice is heard (and of course it isn’t really), it must be for that.
Thanks!
🤔 But — could you describe how immigration harms you personally?
I'm asking because the general argument against immigration is an indirect economic argument. The argument typically goes like this: The land can support a certain size of population. If more people come in, the land will not be able to produce enough food for everyone.
The trouble is just: This argument is precisely the Malthusean theory that my quote of Henry George refers to. And it is unfortunately not an accurate model of reality — it's not true. And hasn't been since 1879. 😅 After the invention of fertilizers, land size is not a big issue anymore — the economy now runs on goods and services that people produce for each other. Sure, immigrants lead to more consumption of goods and services — but in order to be able to buy these, they also need to work to produce them. In other words, "land" has been replaced by "labor" — and while an immigrant can, by definition, not bring the resource "land" with them, they can and do bring the resource "labor" with them anywhere they go.
The issue here is that if you are someone who makes their living providing labour, it's a very bad thing for you to have more labour in the pool.
If a job needs to be done, and I am one of the few people who can do it, I have much better leverage than if I am one of the many people who can. This is a very classic leftist argument (see union shops).
On a personal note, housing is one of the areas where it really affects me. 25 years ago, the house my parents bought was a 5 bed 2 bath with an unfinished basement for $200000. With 2% inflation, it would be around $375000 today. Instead, it's around $3000000. At the same age my parents were moving into a great home in a wonderful neighborhood, I'm moving into a tiny condo in a cheaper city, for over double the cost of the house I grew up in. I am Canadian, as I've mentioned before - so the level of immigration I've seen is way above that of the US. But it's one of those problems that scales linearly over time - the more people you allow in without increasing services (everything from doctors, employees at the local DMV, all the way down to lanes on roads), the more everyone who needs those services has their quality of life decrease.
Edit: A word, I meant "Decrease", not "Improve".
Yes. But the influx of people also means that now two jobs need to be done, and you're no worse off. That's the core of the argument — there is more labor, but there is also more work to be labored on.
Same goes for housing — new people? They are willing to pay for building more houses!
Of course, the time horizons and other restrictions do matter. I'm not saying that the housing market isn't broken, or that sudden shifts in worker availability do not have temporary effects. What I am saying is that blaming it on immigration is not an accurate model of reality — and, even more importantly, Trump is exploiting that for his personal gain.
But I mean, this is not what we actually see; what you are expressing is what we keep getting told will be the case with immigration, but somehow never actually seems to materialize. When I was a child, I had a family doctor; now, I'm part of roughly 20% of my province that does not, and the lineup to get a family doctor is in the range of years. When I was a kid, the weekly grocery bill was around $100 CAD for a 5 person family per week; it's now around $100 CAD for a single person. This is far in excess of nominal inflation.
The time horizons matter too; I'm currently 33, and moving into a place that is not big enough to raise a family. If the immigration jobs end up stabilizing in 5 years, I'll be 38; if I wanted a family with 5 kids, I'm kind of out of time at that point. It doesn't actually matter to me if everything will be better in 5 years; I only have one life.
I think your theories only make sense if the only immigration is net contributors (people who are likely to pay more taxes than they consume); however, Canada supports both spousal unification, as well as family unification (including the extremely elderly). We also have an average wage of $49000 for new immigrants (as opposed to the $55000 for native Canadians). As such, the immigrants are literally making us poorer on a per-person basis, driving up the cost of our resources that cannot grow at the same pace as immigration (housing, health care), and bringing their racial and ethnic tensions to our streets. Our GDP may be higher than it would've without them; but that doesn't help when my wage doesn't go up, and everything is more expensive (and in Canada, our GDP per capita has actually gone down).
You describe genuine issues. But the question is: Are these really caused by immigration? I mean it, for real. You can have the firmest belief in the perception that these issues are causes by immigration. But reality simply does not care what you believe. What if you seriously entertain the possibility that you could be wrong on this? What if stopping immigration simply doesn't do anything on the above issues?
That is the essence of my point: There is a good chance that the issues in housing and health care that you are experiences are not caused by immigration, and — there are people out there who want to profit from your belief on this matter, that's what my quote by Henry George is about. Trump is such a person.
I mean, to turn the question on it's head - is there any evidence that would persuade you that it is caused (or at least, worsened) by immigration? From my perspective, it doesn't have to be caused solely by it in order for it to be aggrevating the situation.
An important thing to remember is that Canada has had approximately 1/8 of its residents added in the last 5 years (2019 census has 37.5 million population, 2024 has 41.8, but there was also a report that approximately 1 million people had overstayed their visas). During that time, I've seen housing prices go up by around 65%. (The place I'm buying was last listed at 315k in 2019, and is 485 today). The housing market began to get out of control with Harper, who dramatically expanded the TFW program; with Trudeau, who went into overdrive with TFW and international students, it became way worse.
Every province in Canada is currently suffering from this, regardless of their provincial leaders. We've had a dramatic increase in coethnic violence, including marches to support Hamas and similar groups.
We had a fairly big outrage recently over Indian international students raiding food banks for meals - this directly reduces the resources available for our population that uses them (which has gone up to about 20% of the population).
Do you think it's possible that immigration could be making things worse for the average person? I can't find you definitive proof that this is the sole cause of every word, because it isn't - all I can do is show you the ways we can see direct negatives from it.
That appears to be true — but Google gives me population data that shows a linear increase at roughly the same rate since 1960. In other words, this level of population growth has been happening for the last 60 years. Now, it's no longer clear how this steady growth would explain the recent 65% spike in the housing market.
I consider the housing market to be generally fishy. For example, there are two ways to come to own a house:
If first way spikes 65% for no apparent good reason, ok fine — but one would expect that the second way, building a house, just keeps up with inflation. After all, it's the cost of materials and construction worker wages. If buying a house is too expensive, people would build houses instead, which equalizes the price of houses. But apparently, that doesn't happen, so something fishy appears to be going on; I bet that there is some sort of rent-seeking going on.
That may be true — but the word "outrage" makes me skeptical: How many Indian international students are raiding food banks for meals? "Outrages" typically arise from small-scale stories that gather much more attention that their actual effect size merits.
Yes, but the evidence would have to come in the form of a model in the sense of system dynamics. This kind of model was used for The Limits of Growth, for example.
My primary issues is that "direct negative" is actually hard to argue and usually not true — as the example of historical Canadian population indicates. Correlation ≠ causation.
Strictly speaking, I don't even want to claim that existing problems cannot be slightly worsened by immigration. What I am claiming is that the existing problem is the one worth fixing, and immigration is a red herring.
(I would concede half a point if the model shows that the system is unstable in the sense that a small amount of immigration causes large downstream effects. Again the stability is the underlying problem, but I concede that this would constitute a very strong aggravation.)
In fact, your other question about labor market participation got me thinking, to the point where a simple calculation shows that at least the position "immigrations steals our jobs" cannot be true. The calculation is this: Consider a city and add 1 marginal person. For simplicity, this person provides 1 person worth of labor. Now, let x be the labor that this person provides. There are essentially two cases:
The point is that it's not possible for both cases to be negative at the same time — otherwise, the only positive action would be to disband the community. After all, this calculation doesn't care whether the person comes from a foreign country or is a white neighbor from a city close by.
The resolution of this conundrum is that the second case is not negative for everyone, but that someone else reaps the benefits. And indeed: If the additional labor makes wages go down, then it must be the job provider who captures the excess labor capacity that the additional person provides. That's what I mean by "existing problem". The new person provides excess labor and could make your life better — but you don't profit from it, because someone else captures that excess labor.
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