Daily Archives: 22 January 2020

Tariffs and Fairness

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In a Wall Street Journal article centered on the way tariffs involved in the People’s Republic of China/US trade “dispute” and the simmering EU/US trade dispute impact a Scottish town, Alistair MacDonald posed a question.

Is it fair for the US, in its pursuit of trade concessions, to hurt smaller businesses that make iconic products in nations such as Scotland?

The question is a non sequitur.  The correction is, “Is it fair to single out particular subgroups for special treatment when addressing the rest of the group or the group as a whole?”

No, of course not.

Or MacDonald’s question is not a non sequitur (other than the business about iconic products, which is irrelevant in any case): the group that, at this stage, should be being addressed is the group known as Great Britain. In that light, it would be both fair and politically sound to exempt Scottish industries from tariffs applied in response to EU trade abuses. Scotland, after all, is first a part of Great Britain, and only through Great Britain a part of the EU.

Losing our Free Market?

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And not just through Progressive-Democrats’ Big Government demands and planned impositions.  Now it’s fund MFWICs with bugs up their noses about their currently favored special interest, exemplified by BlackRock’s Larry Fink.

BlackRock, along with Vanguard and State Street, are the three most powerful investment funds, holding as they do roughly 20% of the S&P 500 through funds they run for investors.  And now Fink is starting to dictate to the companies his company owns shares in what they must do vis-à-vis climate change, Fink’s issue du jour.

Mr Fink is surely right that investors should worry about climate risks leading to big shifts of capital, and therefore big price moves.

No, Fink isn’t “surely” right, for all that he might be. More likely, the climate-related risks are political, as politicians extend their pandering, rather than empirical.

Regardless, though, Fink’s rightness or wrongness isn’t relevant. What’s important here is that Fink shouldn’t be allowed to dictate to those investors that they must invest according to his diktat rather than in accordance with their own imperatives or read of the factors relevant to their own investing.