Friday, January 27, 2017

Peter Navarro: Criticism of Border Adjustment Tax is "Fake News"

It's getting late and I'm exhausted but I have to share this one.  It's too good.

Peter Navarro just surfaced to set us all straight.  Peter Navarro, for those who don't know, is the sharp economic critic of China installed as the Trump Administration's director of the National Trade Council.  He appeared on CNBC today and, as the article notes, had a "let them eat cake" moment. I guess he's the Marie Antoinette of our era now.

You have to read this.  By the way, the article includes some pretty humorous tweets, that is if you haven't lost  your sense of humor yet.

From the article:

Retailers are worried about [the Border Adjustment Tax]. In a release published this month opposing the border tax, the National Retail Federation cited a talk by William Dudley, the Federal Reserve Bank of New York president, who said: "I think that it probably would lead to a lot of changes in the value of the dollar, the prices of imported goods in the US, and I'm not sure that that would all happen very smoothly. I also think there could be lots of unintended consequences."

CNBC's Melissa Lee pointed to a Citigroup estimate that said this new tax would be a massive hit to company earnings. That means people working in retail would likely lose their jobs as companies try to cut costs.

Navarro immediately got defensive.

"Well, first of all, this is a false narrative and a fake study," he countered.

Lee was a bit surprised. "Let me get this right," she said, "Citigroup did a fake study?"

"Citigroup has no credibility," Navarro said. He called the bank's analysis, and analysis from the Peterson Institute for International Economics, "garbage studies and scare tactics" and compared them to media outlets like MSNBC and CNN.

"We are not backing off," he said.

Lee pointed out that Citigroup isn't the media — it's research written for investors looking to find out if companies are healthy. Navarro ignored that point.

"Yeah, well, the Dow just hit 20,000, how you like them apples?" he said. "There are winners and losers."

Winners, we are assuming, are the people who get to keep their jobs. Losers are everyone else.

The internet wasted no time in expressing dismay at the interview — CNBC's own journalists included.

Whoa.  There are winners and losers.  That's a slogan we've heard from Brady, too.  So when the firings happen, it's okay - you're taking one for the team.

Every day gets stranger and stranger.  Please remember, Navarro articulates an argument supporting Kevin Brady and Paul Ryan. Navarro has become one of their compadres now.  This is among the many reasons Ryan and Brady should be looking over their shoulders.  They are fighting to KEEP this provision in the bill and that attracts the support of folks like Peter Navarro. Ryan and Brady are making this happen and will own it.  Please explain this to me . . . .


  1. From the WSJ ("It's Not Just Mexico: U.S.'s Import Tax Proposal Has Asia Quaking, Too): "To be sure, it is unclear what form of tax changes will pass, whether specific countries can be targeted, or whether the plan will escape legal challenge at the World Trade Organization. But the border-adjustment tax is likely to penalize the U.S. consumer in the short term and risks kicking off an emerging-market debt crisis that would hamper any chance of a sustained global recovery, said Megan Greene, Manulife’s chief economist. 'All at a time when central banks have used up most of the dry powder in their arsenals,' she said in the report. 'As an economist, it is hard to think of a scarier scenario.'"

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