OECD's Mann Says U.S. Border Tax Won't Achieve Objective

The video discusses the implications of a border tax, highlighting its potential to increase export costs and questioning its effectiveness. It contrasts different economic models, emphasizing the importance of overall trade deficits over bilateral ones. The discussion extends to global trade dynamics, comparing countries like Germany, the UK, and the US. The OECD forecast warns of risks from increased trade barriers, potential stock market volatility, and the continuation of low growth, stressing the need for careful economic strategies.

What is a potential consequence of implementing a border tax according to the discussion?

• It will have no effect on currency values.

• It may lead to an export tax.

• It will boost domestic production significantly.

• It will decrease import costs.

Why is analyzing bilateral trade deficits considered insufficient?

• It underestimates domestic production.

• It overestimates the impact of tariffs.

• It focuses too much on currency fluctuations.

• It ignores the overall trade balance.

How might a 10% import tax affect US exports according to the calculations discussed?

• It would lead to a 5% increase in exports.

• It would have no effect on exports.

• It would cause a 15% decline in exports.

• It would stabilize export levels.

What is a key argument against combining corporate tax reform with border tax adjustments?

• It complicates international trade relations.

• It increases domestic production costs.

• It simplifies the tax code too much.

• It reduces government revenue.

What is a challenge mentioned in relation to large countries and trade rules?

• Focusing solely on domestic trade.

• Ignoring the World Trade Organization.

• Creating rules that only benefit small countries.

• Imposing rules without accepting them domestically.

What is a potential risk of increased trade barriers on the global economy?

• A significant increase in global growth.

• A continuation of the low growth trap.

• A decrease in currency volatility.

• An immediate global recession.

What is the forecasted global growth rate by 2018 mentioned in the discussion?

• 2.5%

• 3.6%

• 4.2%

• 5.0%