'Understand, there are winners and losers in every serious tax change, including in my proposal. And my proposal will mess with the Nash equilibrium, but it will do so in a less abrupt manner and allow for a transition to a smoother and new equilibrium without instigating a trade war. US businesses will still get their border advantage, and we can actually find the capital for literally hundreds of thousands of new businesses that will create millions of jobs.'<blockquote>'The situation of the late ’20s and early ’30s is precisely the one that Charles was referring to: America decided that the global production playing field was tilted against American interests and needed to be leveled. I don’t think anybody today would want to go back to the 1930s. Nobody wants another Great Depression. Again, let me remind you that FDR did not repeal Smoot-Hawley and continued many of Hoover’s destructive policies. There is plenty of bipartisan blame and shame to go around here.
..
The proponents of the BAT argue that it is technically within the rules of the WTO. I am neither a global trade lawyer nor the son of a global trade lawyer, and I don’t know the technicalities of those rules. But I am pretty good country boy observer of the political process. The WTO is not like the US Supreme Court, which is bound to operate according to the US Constitution. The WTO is a political process. Call me skeptical, but I don’t think President Trump has a lot of political capital to spend at the WTO. I think the likelihood that he would lose a WTO ruling is damn near certain.
If he does, we can either try to change the rules or leave the WTO. The volatility that would surround the US’s departure from the WTO would be quite impressive. Global markets would absolutely collapse, and the Trump bull market would quickly morph into the Trump bear market. Think Hoover. Which is one reason I don’t think Trump will actually support the BAT. Fingers crossed.
The broader point is that all this potential turmoil is avoidable. There is a much better way that Trump and Ryan and the Republican team, in cooperation with the Democrats, can simplify the tax code without risking trade chaos, a global recession and possibly a global depression. We can achieve everything we are trying to do, give US entrepreneurs and businesses the impetus and capital they need to launch one new business after another, create the jobs that we so desperately need, and simplify the tax system while balancing the budget. And we can give every worker in the United States a significant pay raise without even touching the concept of increasing the minimum wage.
Sound like pie in the sky? No, but it means real change … which will require real change.
Understand, there are winners and losers in every serious tax change, including in my proposal. And my proposal will mess with the Nash equilibrium, but it will do so in a less abrupt manner and allow for a transition to a smoother and new equilibrium without instigating a trade war. US businesses will still get their border advantage, and we can actually find the capital for literally hundreds of thousands of new businesses that will create millions of jobs.
You can say that I’m a dreamer, but I’m not the only one.'
- John Mauldin,
Tax Reform: The Good, the Bad, and the Really Ugly – Part Three, February 19, 2017</blockquote>
Context<blockquote>
'Germany Plans to Cut 2017 Debt Sales .. Balanced-Budget..'</blockquote>