3 ms·

> Section 122 does not define the phrase “fundamental international payments problems.” This seems like the gaping hole that this will be driven through.

seanhunter 8mo ago
Yes. My bet is they are going to try to say that a “balance of payments” problem is a “payments problem”, which maybe it is maybe it isn’t. It certainly sounds like it wasn’t what the framers of this particular law had in mind but there we are.
- JumpCrisscross 8mo ago
  > they are going to try to say that a “balance of payments” problem is a “payments problem” "The balance of payments consists of two primary components: the current account and the...financial account" [1]. The current account is the trade deficit or surplus in goods and services. The financial account (a/k/a the capital account) tracks movement of money. If you have a free-floating currency, your balance of payments is always zero. This is the principle advantage of a free-floating currency: your exchange rate adjusts to finance trade deficits and invest surpluses [2]. America does not have a balance of payments problem because America doesn't fix the price of a dollar. The best the U.S. could argue for § 122 jurisdiction is that a trade deficit constittues a fundamental international payments problem. That is, of course, nonsense from an economics perspective. But I don't know how these terms have been used in U.S. trade law. (My strongest argument against the author's argument woudld be that the Congress passing statute that "no longer applied by the time the Trade Act was introduced" merits deeper scrutiny of Congressional intent.) [1] https://en.wikipedia.org/wiki/Balance_of_payments https://en.wikipedia.org/wiki/Balance_of_payments [2] https://fraser.stlouisfed.org/files/docs/meltzer/fribal67.pdf https://fraser.stlouisfed.org/files/docs/meltzer/fribal67.pd...
  - TrnsltLife 8mo ago
    > That is, of course, nonsense from an economics perspective. No problem. Ketanji Brown Jackson is not an economist either!

seanhunter 8mo ago

Yes. My bet is they are going to try to say that a “balance of payments” problem is a “payments problem”, which maybe it is maybe it isn’t. It certainly sounds like it wasn’t what the framers of this particular law had in mind but there we are.

JumpCrisscross 8mo ago
> they are going to try to say that a “balance of payments” problem is a “payments problem” "The balance of payments consists of two primary components: the current account and the...financial account" [1]. The current account is the trade deficit or surplus in goods and services. The financial account (a/k/a the capital account) tracks movement of money. If you have a free-floating currency, your balance of payments is always zero. This is the principle advantage of a free-floating currency: your exchange rate adjusts to finance trade deficits and invest surpluses [2]. America does not have a balance of payments problem because America doesn't fix the price of a dollar. The best the U.S. could argue for § 122 jurisdiction is that a trade deficit constittues a fundamental international payments problem. That is, of course, nonsense from an economics perspective. But I don't know how these terms have been used in U.S. trade law. (My strongest argument against the author's argument woudld be that the Congress passing statute that "no longer applied by the time the Trade Act was introduced" merits deeper scrutiny of Congressional intent.) [1] https://en.wikipedia.org/wiki/Balance_of_payments https://en.wikipedia.org/wiki/Balance_of_payments [2] https://fraser.stlouisfed.org/files/docs/meltzer/fribal67.pdf https://fraser.stlouisfed.org/files/docs/meltzer/fribal67.pd...
- TrnsltLife 8mo ago
  > That is, of course, nonsense from an economics perspective. No problem. Ketanji Brown Jackson is not an economist either!