Harvard Men – Fat Tail Daily | Australian Markets

“In every disaster throughout American history, there always seems to be a man from Harvard in the middle of it.”

—Thomas Sowell

Pete Navarro is within the news. He is believed to be the ‘architect’ of Trump’s tariff insurance policies. Fox:

White House trade advisor Peter Navarro mentioned Monday that an offer by Vietnam to eradicate tariffs on U.S. imports wouldn’t be enough for the administration to carry its new levies introduced final week. “Let’s take Vietnam. When they come to us and say ‘we’ll go to zero tariffs,’ that means nothing to us because it’s the nontariff cheating that matters,” Navarro mentioned on CNBC’s “Squawk Box.”

Say what?

Even with zero tariffs Vietnam would nonetheless be subject to ‘reciprocal’ fees from the US? How may Vietnam eradicate the ‘non-tariff barriers?’ Make sure its currency doesn’t go down in opposition to the greenback? Change its tax insurance policies so they don’t encourage exporting?

Would it have to present up what Adam Smith referred to as it’s ‘comparative advantage’ – low-cost labor — and raise wages to the US unionized normal, with all America’s labor protections, over-time pay, holidays, and pensions?

Will oil wealthy nations need to compensate for having low-cost vitality? Cold nations should pay a penalty for not needed A/C? Will heat ones need to apologize for his or her bananas?

White House consultants don’t really analyze any of these issues. They simply have a look at trade volumes. So, the one method they are going to know if Vietnam is just not ‘cheating’ is that if the stability of trade is even. By this system the US was a cheater from 1875 to 1971….it ran trade surpluses in all these years. It had a very environment friendly, superior financial system. Should it have been punished for that?

It was solely after Nixon modified the world’s money system that the deficits started…and by no means ended. The new ‘fake’ greenback — that the US can successfully ‘print’ at will – is the trigger of America’s power trade deficits, not NTBs. The actual story: after 1971, the US may buy what it needed with its inexhaustible new money; it didn’t need to compete.

Navarro is claimed to have a Ph.D in economics from Harvard. This makes us very suspicious of Harvard’s requirements. But Harvard has figured prominently in US historical past…and, normally, disastrously.

In idea, the position of a Harvard schooling – we get this primary-hand from sharing our marriage mattress with a Harvard grad for the final 41 years – is to self-discipline the thoughts so it thinks with rigorous logic, and furnish it with enough literature, historical past and science to present it one thing to consider.

How then does a man like Pete Navarro finish up with a Ph.D. from that august establishment? Perhaps its requirements have slipped?

A bastion of privilege, energy and positivism, Harvard cultivates a pernicious weed – the one that believes he can use his mind to know what others ought to do…and use the federal government to make them do it. Sprouting from seed in Cambridge, the weed spreads…and shortly has lined the ground all the way in which to the Potomac.

Trump was in search of an financial advisor. His son-in-law reportedly discovered Navarro’s e book (maybe then on the rest desk, together with our forgotten traditional “Empire of Debt”).

In ‘Death by China’ the creator often quotes one other Harvard man, Ron Vara. The solely drawback is that there’s no Ron Vara. He is Navarro’s made-up alter-ego. In impact, the ‘Death by China’ theme is supported by two Harvard males – one fictional, each delusional.

And now phrase on the road is that Ron Vara is butting heads with Elon Musk. Here’s Politico:

In the early hours of Saturday morning, Musk took to his social media platform X to launch an obvious assault on the president’s senior trade counselor, taking jabs at Navarro below a video through which he defined the Trump administration’s logic in levying tariffs during a CNN look. The Department of Government Efficiency head replied to a different person’s touch upon the video lauding Navarro’s clarification, writing of the economist: “He ain’t built shit.”

Then, Elon’s brother joined the scuffle. Business Insider:

Kimbal Musk, the youthful brother of Elon Musk, mentioned on Monday that President Donald Trump’s slate of reciprocal tariffs could be like imposing a “permanent tax” on US customers.

The Musk crew and the Trump/Navarro Team will not be on the Same Team. Musk represents actual financial pursuits…Trump is politics incarnate.

Tariffs are a political transfer…half demagoguery, half cupidity. They make politicians more highly effective as they get to decide on who pays what to whom. And they make a few insiders richer as they favor some industries over others. But in the end, they weaken the financial system and make everybody else poorer.

Eventually, the 2 groups are going to come back to blows. And perhaps sooner than later. Newsweek:

Musk’s open criticism of White House coverage is the primary time that the connection between himself and Trump has seemed to be strained.

Musk:

“A PhD in Econ from Harvard is a bad thing, not a good thing. Results in the ego/brains>>1 problem.”

More to come back…

Regards,

Bill Bonner,
For Fat Tail Daily

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