Putting some steel into trade

Written By: - Date published: 8:45 am, March 4th, 2018 - 82 comments
Categories: Economy, Free Trade, Globalisation, International, trade, us politics - Tags:

Does anyone want to take a punt on where the U.S. tariffs on steel and aluminum will go?

I think the first to move will be Canada, who will see it as a direct threat against its own huge steel and aluminum industry, as well as a direct threat to its massive car parts industry.

The Rules of Origin requirements within the CPTPP (of which Canada is an impending signatory) are used to determine the country of origin of a product for purposes of duties and restrictions imposed under the rules of the proposed CPTPP and other trade and investment deals, and they are critically important in the U.S. automotive and parts industries, which play a critical role in trade within NAFTA, and in trade with Japan and other TPP partners.

Or at least, they would have been if the U.S. had signed up. Under the CPTPP, signatory partners could have got preferential access to U.S. markets for goods with a lower share of domestic content than in prior agreements, especially the NAFTA.

I do not yet know how the special appendix on auto marts in CPTPP is going to get pulled in to this. So far I’m just reading share market result of auto makers, and the whole of the market is spooked on Trump’s destabilization.

Either way, an’t no frickin’ way the U.S. is getting into CPTPP after this.

I think the second to move will be Europe, who will of course work with Canada against the U.S. under their pretty advanced own trade agreement. I would expect the counter-measures to start with luxury goods – because that is where decision-makers get hurt the hardest.

Somewhere down the list will be the Australian and New Zealand steel and aluminum producers. That means: every one of those businesses and their staff are rapidly recalculating how much business they are now going to lose to the U.S. manufacturers. Rio Tinto in Bluff, and Bluescope Steel in Waiuku, will be running numbers about their marginal business viability. We don’t need reminding that we are a marginal electricity price proposition, but it’s about to happen again. Need I say thousands of our jobs?

If you every wondered why multilateral trade orders exist, you’re about to get your first global lesson in a long time, and it has simply massive implications here in New Zealand. A mighty sting. And all those Prime Ministers and Presidents will be pulling out their CPTPP-signing pens as fast as they can unbutton their jackets.

But the one to watch is China. Expect no sudden moves, other than further takeovers to consolidate vertical control of the entire auto industry and indeed the entire East Asian production system from materials to sales to consumer preferences. As much as they can, they will ensure that not even cheaper materials price disturbs their global control of automotive manufacturing.

Price isn’t everything, but for commodity producers like New Zealand, it’s most things.

82 comments on “Putting some steel into trade ”

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  1. Jenny 1
    4 March 2018 at 9:59 am

    Does anyone want to take a punt on where the U.S. tariffs on steel and aluminum will go?

    ADVANTAGE

    At a guess I would say, major Job losses and cutbacks at New Zealand Steel.

    A very real possibility which must be worrying the minds of the management and workers.

    As the West Coast of the US is the main destination for New Zealand Steel’s primary export product, coiled sheet steel.

    The implications are for major job losses and cutbacks at the Glenbrook New Zealand steel mill, currently employing roughly 1500 permanent workers, plus hundreds of contractors and suppliers, being a major part of the South Auckland economy. The flow on effects to the greater Auckland economy could be that the Auckland region as a whole takes a sizable hit.

    • infused 1.1
      4 March 2018 at 12:31 pm

      NZ steel is quite strong in New Zealand at the moment. There’s heaps of manufacturing being done, despite what people say, and with the ‘bad steel’ from China.

      But also, we produce fuck all.

  2. Sabine 2
    4 March 2018 at 10:12 am

    Its working a treat. All ready. So much winning. Seriously.

    http://business.financialpost.com/pmn/business-pmn/electrolux-halts-tennessee-project-after-tariff-announcement

    Quote: NASHVILLE — Electrolux says its plans for a $250 million plant expansion in Tennessee are on hold, and the Swedish appliance maker is pointing to President Donald Trump’s tariff action as the reason.

    The company’s investment plans, announced in January, included modernizing and adding 400,000 square feet (37,160 square meters) to the plant in Springfield. Construction was slated to begin later this year.

    Electrolux is citing Trump’s announcement of new tariffs on imported aluminum and steel.

    “Unfortunately, this decision gives foreign appliance manufacturers a cost advantage that is hard to compete against,” Electrolux spokeswoman Eloise Hale said in a statement to The Tennessean .

    Hale said the company is still evaluating the recent tariff announcement, but is so concerned about the potential financial impact that it put the Springfield project on hold until Trump’s order is signed and final details are clear.:Quote end.

  3. Jenny 3
    4 March 2018 at 10:19 am

    “NZ to seek exemption from Trump’s steel tariffs”

    However, New Zealand would not be adding its voice to the criticism, with Trade Minister David Parker saying New Zealand will not be making any threats of retaliation.

    “We wouldn’t be responding by the threat of trade retaliation ourselves, which I see has been the response of some countries,” he said.

    “But we would certainly be advocating on behalf of the New Zealand steel industry that these tariffs if introduced [would] not apply to them

    “We are of course a traditional partner of the United States, so we would be submitting to them that they shouldn’t be catching New Zealand steel exports in a regime like that if they introduced it.”

    https://www.radionz.co.nz/news/political/351703/nz-to-seek-exemption-from-trump-s-steel-tariffs

    • red-blooded 3.1
      4 March 2018 at 10:40 am

      Well, good luck to Parker – he has to give it a try, but I’d say Canada and the EU are traditional trading partners for the US, too (as is most of the the world). I’m not sure why Trump would give us a break – what does he care?

      Of course we can’t threaten retaliation because we’re too small for that to be effective and because as soon as we start applying tariffs etc then we start locking up the economy again. Clothing manufacturers, appliances, hell – we used to assemble cars in NZ! And while some might argue that it’d be good to protect our own industries and retain more of the profits here in NZ, not many would argue that it’d be good to go back to the prices and lack of variety that we had when those tariffs were in place.

      He’s starting with steel – is this going to be the end of it? Somehow I doubt it. “Fortress America” they used to call it… (and it took Pearl Harbour to wake them up to the fact that the rest of the world doesn’t just go away when they close the door and put up the “Stay Out” sign).

      • Incognito 3.1.1
        4 March 2018 at 11:35 am

        I’m not sure why Trump would give us a break – what does he care?

        Favouritism is a hallmark of Trump politics IMO and wedge politics (AKA divide and conquer) is another important driver. The US need friends in the region and a minnow like NZ that likes to think it ‘boxes above its weight’ is just ripe for the picking. Trump makes decisions on feelings & perceptions that are not informed or clouded by opinions of officials. Just my 2 cts.

        • tracey 3.1.1.1
          5 March 2018 at 8:56 am

          I tend to agree. He wont name who is with him but say “some countries understand and agree” . We might be one of those enabling his BS in return for an exemption.

      • McFlock 3.1.2
        5 March 2018 at 12:00 am

        The other answer to “why does he care” is that he doesn’t, but he does seem to bear a grudge.

        So we sneak in by being people he hates least, even if the EU and Canada manage to get the tarriffs shot down.

      • KJT 3.1.3
        5 March 2018 at 9:56 pm

        go back to the quality and well paid jobs, that we had when those tariffs were in place.

        Fixed it for you.

        Apart from UK made cars, of course.

    • tracey 3.2
      5 March 2018 at 8:54 am

      Of course we wont say anything, our trade plans remain

      Drop pants to ankles
      Bend over
      Grimmace but make it look like a smile

  4. joe90 4
    4 March 2018 at 10:38 am

    Does anyone want to take a punt on where the U.S. tariffs on steel and aluminum will go?

    A politically driven Bush 43 steel tariff came back and bit them on the arse so same again, I reckon.

    .

    In a decision largely driven by his political advisers, President Bush set aside his free-trade principles last year and imposed heavy tariffs on imported steel to help out struggling mills in Pennsylvania and West Virginia, two states crucial for his reelection.

    Eighteen months later, key administration officials have concluded that Bush’s order has turned into a debacle. Some economists say the tariffs may have cost more jobs than they saved, by driving up costs for automakers and other steel users. Politically, the strategy failed to produce union endorsements and appears to have hurt Bush with workers in Michigan and Tennessee — also states at the heart of his 2004 strategy.

    “They tried to play politics, and it looked like it was working for a while,” said Bruce Bartlett, a conservative economist with ties to the administration. “But now it’s fallen apart.”

    https://www.washingtonpost.com/archive/politics/2003/09/19/steel-tariffs-appear-to-have-backfired-on-bush/f86f1307-4912-40ea-985d-71d8f423719b/?utm_term=.85798a6cbc83

  5. Aught3 5
    4 March 2018 at 10:38 am

    How about responding with a tax (equivalent dollar value) on US multinationals income in NZ (e.g., Google, facebook). They should be paying on revenues generated in NZ anyway so the tax could remain in place if the tariffs get overturned by WTO. The tax could even be used to support steel & aluminum manufacturing while they transistion to new markets.

    Also how would Russia feel about the new tariffs. They are a big exporter of raw materials to the US so would be hurt but on the other hand this appears to be fomenting a lot of tension between the US and its western allies which Russia has to be pleased with.

    • D'Esterre 5.1
      4 March 2018 at 10:09 pm

      Aught3 “Also how would Russia feel about the new tariffs. They are a big exporter of raw materials to the US so would be hurt……”

      No, Russia accounts for a small part only of US steel imports. Canada and China are major players. Russia wouldn’t be greatly affected.

      “….but on the other hand this appears to be fomenting a lot of tension between the US and its western allies which Russia has to be pleased with.”

      In virtue of what would you leap to the conclusion that Russia relishes the notion of further conflict and chaos among its trading partners? You don’t really believe all that mad Russophobia emanating from US and Europe, do you?

      Here’s a thing: it may be the case that some in the West sit around stewing in impotent hatred against the Russians, but the reverse isn’t true. The Russians have done nothing to you, or them, and would rather do nothing with you. Or them.

      Spiteful monomania isn’t attractive to anybody.

      I’ll take a punt that you’re not a fan of Trump. That being so, and given that he’s been suborned by the US political establishment, such that he also spouts their anti-Russia invective, I’d have thought that you’d not echo him, so as not to be caught agreeing with anything he says.

      • tracey 5.1.1
        5 March 2018 at 8:58 am

        I will take a punt and say that your idea that

        West fixated with Russia
        Russia disinterested in West

        Is bollocks.

  6. Jenny 6
    4 March 2018 at 10:43 am

    “Donald Trump’s call on steel, aluminium tariffs could hit Australian companies, including BlueScope Steel”

    “The Australian share market has taken a hit after Donald Trump’s announcement of large tariffs on steel and aluminium imports.”

    However, despite the Australian economy taking a hit, presumably from the projected loss in Aussie jobs in the Steel sector. New Zealand Steel’s Australian owners are unlikely to go to bat for Kiwi jobs at Glenbrook, (or indeed for Aussie steel worker jobs).

    Why?

    Because Bluescope who are the owners of New Zealand Steel, also have extensive steel production interests in the US itself and so are poised to benefit from the 25% tariffs.

    THE Australian share market has been pulled down by one per cent falls on Wall Street overnight amid fears of a trade war prompted by US president Donald Trump’s announcement of import tariffs on steel and aluminium.

    The benchmark S&P/ASX200 index was down 0.74 per cent at 5,929.3 points at midday AEDT, with all sectors in the red.

    The local market is trading under pressure, after a third day of more than one per cent declines on US indices, with stocks declines exacerbated on concern of a possible trade war following the surprise tariff announcement.

    The Dow Jones Industrial Average fell 1.68 per cent, while the S&P 500 lost 1.33 per cent.

    However, Australia’s biggest steel maker BlueScope was up one per cent at $16.325 with its US operations in line to benefit from the proposed 25 per cent tariff on steel.

    http://www.news.com.au/finance/business/manufacturing/donald-trumps-call-on-steel-aluminium-tariffs-could-hit-australian-companies-including-bluescope-steel/news-story/6373a233e9fa260faefcefa17d69c9ee

    • tracey 6.1
      5 March 2018 at 8:59 am

      Sigh

      • Jenny 6.1.1
        5 March 2018 at 9:05 pm

        Any attempt by Bluescope to throw New Zealand Steel under the bus to protect their US interests, should be met with aggressive counter action in the public interest by the government.

        If Bluescope dare to try to close down the Steel Mill at Glenbrook, (at the cost of 1,000s of jobs, which would throw the economy of South Auckland into a tail spin). Then in response, the government publicly announce that if Bluescope persist with this course of action, then the government will be left with no alternative but to take the necessary steps to take over this asset, (which after all was built by the taxpayer). Even if this emergency measure requires legislation passed under urgency.

        Further that after taking control of this asset, the government invest in developing the sort of carbon free steel technology being pioneered in Sweden.

        A coalition in Sweden looks to break ground on a pilot project aiming to produce steel without the use of fossil fuels. The HYBRIT project replaces coking coal, which is traditionally needed to make ore-based steel, with hydrogen.

        HYBRIT is a joint venture between SSAB, the largest Nordic steel producer; LKAB, Europe’s premier iron ore producer; and Vattenfall, a large electric utility. The group conducted a pre-feasibility study from 2016-2017 and hopes to spend this spring planning and designing a pilot plant. HYBRIT plans to break ground this summer, with the pilot phase extending at least through 2024. Overall, the group hopes to achieve competitive fossil-free steel production around 2035.

        https://insights.globalspec.com/article/7873/sweden-s-hybrit-strives-for-coal-free-steel-production

  7. Keepcalmcarryon 7
    4 March 2018 at 11:26 am

    Let’s retaliate by reappropriating our sovereign territory and shipping Peter Theil and the other 1 percenters back home.

    How is it that “free trade” has allowed our industries to be foreign owned, profits go overseas but local workers are the ones on the block when the shit hits the fan?
    And the answer is more globalism?

    • Pat 7.1
      4 March 2018 at 12:14 pm

      would you recommend unsupported cold turkey for a heroin addict?

      • Keepcalmcarryon 7.1.1
        4 March 2018 at 2:00 pm

        I don’t think signing the CPTPPA is any kind of soft weaning if that’s what we are driving at. It’s higher grade heroin, high highs for the 1 percent and blood borne disease and overdose for the rest.

        • Pat 7.1.1.1
          4 March 2018 at 2:07 pm

          I think Labours agreement with signing the TPP is a hedge against exactly this….whether it will work is yet to be seen but as stated previously (aside from a few elites jumping out of their foreclosed penthouse windows the wealthy will come up smelling of roses either way) NZ needs trade even under dubious terms.

      • Gabby 7.1.2
        5 March 2018 at 7:08 am

        Yes.

  8. Bill 8
    4 March 2018 at 12:09 pm

    Subsidising domestic production rather than imposing tariffs on foreign production would, it seems to me, have been a more sensible route to take.

    Anyway.

    Good to see “free trade” being given a bit of the old heave-ho.

    No more off-shoring of production in search of lower wage costs is a good thing. If the US continues down this path, then power shifts back to labour.

    Their problem is that favouring domestic production when so much has already been shifted off-shore, and combating the straddled and stretched out nature of production as it exists these days…yeah, I don’t think simple protectionist measures that hearken back to yesteryear are going to cut it.

    • Pat 8.1
      4 March 2018 at 12:20 pm

      Plenty of subsidies already……creating the dichotomy is all very good (and generally of little use) but ignores the realities of the transition from one to the other….especially when its sudden and rapid.

      Pendulum swing or cyclical?

      • Bill 8.1.1
        4 March 2018 at 12:49 pm

        We (ie – labour) were thrown under the bus when the step change to more liberal trade arrangements was undertaken, and we’ve been getting dragged along under the wheels ever since.

        if there is no change, then we just carry on getting rubbed along the ground. And if there is a change, that’s going to hurt too. But given the choice between temporary hurt and grinding on forever hurt…

        Remember that lie of liberalism – “no gain without pain”? If what we are seeing in the US is the beginning of the end of liberalisation in global trade and finance, then maybe that wee slogan will finally be seen to contain some truth.

        • Pat 8.1.1.1
          4 March 2018 at 1:03 pm

          you may well be right in all that….but like the lurch to laissez faire in the 80s this could be just as painful and disruptive for the same demographic

          • Bill 8.1.1.1.1
            4 March 2018 at 1:44 pm

            …just as painful and disruptive for the same demographic

            Let’s assume that to be the potential. Is that a reason to rail against this prospective shift? Or is it a reason to ensure that security, and safety nets that were shredded in the ideological fervour of the 80s, gets restored and enhanced?

            Maybe even a time or opportunity to acknowledge a post job reality; a post consumer reality; AGW realities?

            Many who were hammered because of the 80s, never found their feet again and never got “back in the game”. And many of us have ‘nothing to lose’…and brexit/Trump etc – ie electorates lashing out in self destructive ways with a ‘deil may care’ attitude when more positive options aren’t available or have been shut down.

            So it could be argued the time is ripe for seismic shifts.

            • Pat 8.1.1.1.1.1
              4 March 2018 at 1:56 pm

              have considered some of that myself…..but sadly have concluded that the more likely outcome is the bottom half will be sacrificed yet again…..we had the opportunity in the eighties to transition with compassion (in NZ) but doubled down instead (Nats of the 90s)…and as you note many have nothing to lose(hence the metaphorical finger) so Im not hopeful of either a more enlightened response nor a more collaborative one…..but after the damage (assuming some form of cohesion remains) we may well see a better world ….in the long run (until the cycle repeats?)

      • tracey 8.1.2
        5 March 2018 at 9:00 am

        The USA has been a highly regulated high subsidy nation for decades despite the calls of being ” free” and global blah blah blah. Smoke and mirrors.

        The reason so many cannot get free trade deals with the USA is because they want to be able to sell to all of us with no limitations and not buy

  9. David Mac 9
    4 March 2018 at 1:08 pm

    The manufacture of steel requires the burning of fossil fuels. Is it an industry we want to grow in NZ?

    I’ve looked at those tough thin pressed laminated wooden salad bowls, microwave and dishwasher proof and cheap as chips. I wondered why something like a car body cant be made the same way.

    I think our future lies in innovation rather than competing with huge plants filled with $5 a day workers.

    • beatie 9.1
      4 March 2018 at 6:39 pm

      Here’s some info about cars made from hemp. Yet another reason for hemp to be grown in NZ.

      http://www.collective-evolution.com/2013/11/01/the-worlds-most-eco-friendly-car-its-made-entirely-from-hemp/

      Bamboo is another possibility and is already being used in bicycle manufacture.

      https://cleantechnica.com/2014/06/04/bamboo-cars-carbon-fiber/

      • David Mac 9.1.1
        4 March 2018 at 8:23 pm

        Hi beatie, yes, I agree.

        The government had Henry Ford destroy his fields of Hemp. This is footage of Henry laying into the experimental car he made in 1941 with the back of an axe. It was lighter than steel and 10 times stronger, it ran on hemp bio fuel.

    • Draco T Bastard 9.2
      4 March 2018 at 8:42 pm

      The manufacture of steel requires the burning of fossil fuels.

      No it doesn’t. It requires carbon for its manufacture and that does result in release of carbon dioxide but it doesn’t require the burning of fossil fuels. Coking coal (which isn’t really a fossil fuel per sé as it’s a terrible energy source) is used as the source of the carbon but other sources could be used.

      I’ve looked at those tough thin pressed laminated wooden salad bowls, microwave and dishwasher proof and cheap as chips. I wondered why something like a car body cant be made the same way.

      They can be but would there be enough plant material available to do so?

      I think our future lies in innovation rather than competing with huge plants filled with $5 a day workers.

      And I think setting rules so that we aren’t trying to compete with $5 a day workers with no protections is a better option. Force those countries to up their game to trade with us.

      • JohnSelway 9.2.1
        4 March 2018 at 8:52 pm

        “I’ve looked at those tough thin pressed laminated wooden salad bowls, microwave and dishwasher proof and cheap as chips. I wondered why something like a car body cant be made the same way.”
        ….

        Yeah – not sure I’d want to be riding a car made of wooden salad bowls into a slippery corner at 90km an hour with a concrete buffer to stop me if I negotiate it wrong…

        • Exkiwiforces 9.2.1.1
          4 March 2018 at 9:21 pm

          The old 3 wheeler Morgan’s were made of wood and then we the Mosquito and Albatross Aircraft built by DH in the 30’s and 40’s again made of wood.

          • JohnSelway 9.2.1.1.1
            4 March 2018 at 9:30 pm

            Yeah, but there’s a reason they don’t make many of them anymore.

            • Exkiwiforces 9.2.1.1.1.1
              4 March 2018 at 9:48 pm

              Well old mate at Ardmore Airfield is pumping out one one Mosquito a year ATM and old mate down Gore way is has the plans for DH Albatross airliner.

              Morgan Car Company is still knocking out cars.

              • JohnSelway …
                4 March 2018 at 9:59 pm

                Which is why when I book a flight I get a ticket on a mosquito.

                There’s a reason we don’t make wooden cars and planes. It’s similar to why we don’t make airships filled with hydrogen

                EDIT – btw there are only 3 Mosquitos left flying today. I’ve seen one at the Masterton air show some 6 years ago or so. Not really something I’d want to crash into the runway in, despite its prettiness

                • Exkiwiforces …
                  4 March 2018 at 10:08 pm

                  Actually airships are safe if you are using helium not hydrogen. Which the yanks refuse to sell helium to old jerry and they had to use hydrogen instead with its know risks. The old Poms managed to cock up their airship program from the get go, but we got Ohakea Airbase out of it as Ohakea was going to the landing site for Brit airships.

                  Well there will be another mossie flying at the end of this year or next year from Ardmore with a further 3 in his shed to fly. Which will make 3 from NZ and one Canada

                  • JohnSelway …
                    4 March 2018 at 10:11 pm

                    Yes I know airships are safe with helium. For the same reason cars and planes are safer with aluminum crush zones and high burning point metals rather than, you know, wood.

                    I think you missed the point

                    • Exkiwiforces …
                      4 March 2018 at 10:29 pm

                      Well NZ has produced 2 airworthy mossie’s so far and the one in Canada, with a further 3 in the Shed in Auckland and one in Ardmore undergoing fit out so it be flying at the end of the year or early next yr.

                    • JohnSelway …
                      4 March 2018 at 10:35 pm

                      The question isn’t “how many mosquitos are being produced” but “is it safer to drive/fly a wooden vehicle over one made of modern metals and alloys”.

                      Here’s a hint – metal alloys will crumple and absorb shock. Wood splinters and has a very low ignition point.
                      You know – for the same reasons F1 is much safer now (watch F1 – The Killing Years on YouTube)

                      This argument is easily solved. I drive a 2006 Kia Rio – fairly good in safety profile. Let’s get together, me in my Rio and you in a car made of hardened wood, and we’ll see who makes it out alive after some sort of crash.

                    • Draco T Bastard …
                      4 March 2018 at 11:19 pm

                      Actually, I think you’re missing it. Composite materials are lighter and stronger than steel. Could probably use them to produce better crumple zones as well.

                    • JohnSelway …
                      4 March 2018 at 11:38 pm

                      You’re seriously arguing wood is a better material to build cars and planes from?

                      EDIT – and no I wasn’t missing the fucking point numbnuts. We’re talking safety, not production. But, hey, I’ll still take a crash in a modern airliner over a wooden Mosquito any day

                    • McFlock …
                      5 March 2018 at 12:15 am

                      I think the Brazilians made a fibreglass car using banana skins, at one stage.

                      We do make cars out oof aluminium, too. Which we use hydro electricity to smelt.

                      And aircraft. And there’s no reason the skin of the aircraft needs to be anything amazing, depending on the use and desired range of the vehicle.

                      The issue isn’t “replace the whole vehicle with dope fibres and epoxy” (and where do we source the epoxy from? A lot of it comes out of the ground, too). The issue is “which bits need to be steel?”

                      The big result of a tarriff war will be less chinese steel production, so aussie mining tanks again/more. Forget steel, what about coal and ore companies when China is producing steel that it can no longer offload in the US…

                    • Draco T Bastard …
                      5 March 2018 at 9:28 pm

                      You’re seriously arguing wood is a better material to build cars and planes from?

                      Boeing certainly thinks so.

                      You sound like the ignoramuses from the 1950/60s that think petrol engines are more powerful than electric motors and that glue is weaker than screws.

                  • Incognito …
                    4 March 2018 at 10:40 pm

                    What’s lighter than helium? Vacuum.

                    Do a search on “vacuum balloons” and you’ll find lots of interesting hits. Here’s just one, as a teaser:

                    https://en.wikipedia.org/wiki/Vacuum_airship

                    Edit: “lighter” is a very poor word choice, BTW.

                    • David Mac …
                      5 March 2018 at 10:36 am

                      Ha! That’s cool, I’ve never encountered the concept. Unlike helium, altitude, rate of descent etc could be altered with pumps.

                      This from your link…

                      “The main problem with the concept of vacuum airships is that, with a near-vacuum inside the airbag, the exterior atmospheric pressure is not balanced by any internal pressure. This enormous imbalance of forces would cause the airbag to collapse unless it were extremely strong (in an ordinary airship, the force is balanced by helium, making this unnecessary). Thus the difficulty is in constructing an airbag with the additional strength to resist this extreme net force, without weighing the structure down so much that the greater lifting power of vacuum is negated.”

                      They’ll need a superstructure lighter, cheaper and tougher than metal. Something like a hemp composite. They needn’t be manned and could lug tonnes of freight over oceans.

                    • David Mac …
                      5 March 2018 at 11:00 am

                      …given their size and the velocity of wind at altitude, these tradeships, could be carried on tradewinds, their solar assisted (no clouds up there) electric motors largely switched off. They might need to get from NZ to Australia via South America but if unmanned, a non perishable cargo and a scheduled stop in Jo Berg, it wouldn’t matter.

                    • McFlock …
                      5 March 2018 at 12:03 pm

                      To get above cloud height you’d need something that can withstand hundreds or thousands of tonnes at seal level, but still have a vacuum flask light enough to enable the vehicle to float that high.

                      Submarines are the model for vacuum airships, rather than dirigibles or blimps, and subs get away with it because water is ~800 times more dense than air. So the material strength to material density ratio can be smaller. Even then most subs of practical long term use can barely dip a toe in.

                      The idea of a vacuum airship reminds me of the awesome idea I had to create an aerogel matrix filled with hydrogen, thus making it a safe alternative to balloons that go bang. Some googling said yes, it can end up lighter than air, but not with enough difference to create a decent payload. It sounds a bit like the rocketry problem, if the margins are too tight you end up with needing amounts so huge that you need bigger everything to run and hold it, and the bigger everything needs more lifting agent, etc.

                      I think there are two ways to go: either we find a combination of materials and structure strong enough to maintain a vacuum (and then there’s merely the problem that a slight leak would make it sink like a brick), or maybe we find some compromise material that makes decent size gas cells but also is flameproof, doesn’t rip under high pressures resulting from internal combustion, and therefore turns a gas cell fire into a manageable problem rather than immediate catastrophic failure.

                    • David Mac …
                      5 March 2018 at 1:17 pm

                      Fascinating stuff McFlock. We used to circumnavigate the globe without burning an ounce of fossil fuel. We can lower the risk factor which leaves the duration of the journey the primary hurdle.

                      As this imaginary vacuum filled airship rises and atmospheric pressure diminishes would it not be possible to retain a constant load on the vessel’s structure by pumping air in or out of the vessel?

                      Difficult to do in a submarine, to counter the increasing pressure on the outside as it dives, I guess maintaining a counter pressure on the inside would make the environment inside inhabitable for humans.

                      Aerogel matrix…..Ha! I dig that. millions of individual cells that self seal when punctured. I’m visualizing how a bowl of dessert jelly behaves when you poke your finger in and then withdraw it.

                      Yes, a constant Catch 22 conundrum. Adding structural integrity = more lift required.

                    • McFlock …
                      5 March 2018 at 1:41 pm

                      The higher the vaczep (for want of a better name) goes, the lower the stress on the vacuum chamber. Like if you built and operated a sub from the sea floor, the stresses decrease as it rises on its first voyage.

                      Changes in bouyancy can be effected easily by ballonets for quicker responses or just changing the total level of vacuum in the main chambers (which would simultaneously lower the maximum height and decrease the pressure differential).

                      Sure you could (with appropriate pressurisation of the cargo/passenger/crew areas) have a certain amount of course control via the jetsream and suspending a sail underneath into the non-stream areas, and tack or jib like sailing boats with hulls against the water and their sails above in the air. Might even travel the world in less than six months, too.

                      But the main problem is finding something light enough and strong enough to maintain a vacuum against hundreds of thousands of tonnes of air. The force against the vacuum is a function of the surface area.

                    • David Mac …
                      5 March 2018 at 2:08 pm

                      Yes, a superstructure light and strong enough and a skin with the integrity of a bullet-proof vest yet the weight of a T Shirt.

                      I’ve pulled this thread way off subject, sorry Ad.

                      I’ll jump over my procrastination and go and do what I should be doing.

                  • Stuart Munro …
                    5 March 2018 at 6:40 pm

                    With the advent of reliable remote piloting there’s no reason we couldn’t have unmanned hydrogen airships – particularly interisland or between NZ and Oz. Hydrogen is much cheaper and provides more lift.

                    • Exkiwiforces …
                      5 March 2018 at 11:53 pm

                      The problem I have with Unmanned Aerial Vehicle’s is that they rely on the GPS systems which is vulnerable to jamming from Commercial Off The Self (COTS) systems or worst case someone/ some country or something knocking a few GPS Satellites out.

                      Slightly off tropic, it’s also why I’m against the NZ Government/ MoD, NZDF and RNZAF purchasing the P8 Multi Mission Aircraft from the States as the P8 relies to much on the use of UAV’s to get the best out of the P8 and the Active and Passive Ground Defence/ Security (Force Protection) measures that are with the P8 and UAV’s. In other words the P8 has more hooks than my B52 fishing lure that I use to catch Barra’s and Toga’s etc..

                    • Stuart Munro …
                      6 March 2018 at 12:09 am

                      More of a freight thing – perishables. Deliver to depopulated headlands – ultra low cost, reasonably fast turnaround. Might be some good for pacific disaster relief – they don’t need much in the way of docking facilities.

                    • Exkiwiforces …
                      6 March 2018 at 12:59 am

                      Yeah fair call Stuart,

                      I’ve been following the “The flying Tit or The flying Nipple” in the UK and they still need a mooring pole the keep thing from flying off in a uncontrolled flight or what happen with the flying Tit or the flying Nipple on one of its test flights while coming in to land.

                      They do have awesome payload capability and even the yank military were looking into it during the Afghan/ Gulf wars? But I don’t see the RNZAF going out to buying them ATM as the risk is still too high, but in saying that I think we are not too far off from the flying Tit etc entering service.

                      Please note the trem “The flying Tit or The flying Nipple” is not my nickname for it, but the Pom’s. I’m sorry if I have offend anyone here. As I couldn’t remember it the name of it, plus 4 Corners was talking about Climate Change from MPI and 1st responses POV and I’ll post something tomorrow about it.

                      Sent from IPad

        • David Mac 9.2.1.2
          4 March 2018 at 9:32 pm

          Click the utube video of Henry Ford whacking his dope car.

        • KJT 9.2.1.3
          5 March 2018 at 12:19 pm

          Probably safer than steel. Wood is more resilient to impact.
          A bit of carbon fibre in the mix, makes it stronger than steel.

      • David Mac 9.2.2
        4 March 2018 at 9:31 pm

        “No it doesn’t. It requires carbon for its manufacture and that does result in release of carbon dioxide but it doesn’t require the burning of fossil fuels. Coking coal (which isn’t really a fossil fuel per sé as it’s a terrible energy source) is used as the source of the carbon but other sources could be used.”

        The system you link to requires raw iron. How do you propose we extract that from rocks without burning fossil fuels? Does a fossil fuel get any more fossil fuel than coal Draco? Coal is fossilised plant matter isn’t it?

        “They can be but would there be enough plant material available to do so?”

        I dunno, hemp and bamboo are very fast growing and thrive in a variety of environments. There are many more acres available for growing the material than the volume of iron ore mines in the world and most of the ore extracted is waste. Most of a hemp plant could be utilised.

        “And I think setting rules so that we aren’t trying to compete with $5 a day workers with no protections is a better option. Force those countries to up their game to trade with us.”

        What? Are you suggesting Jacinda march into the oval office, thumps the desk and declares “This is how it’s going to be Trumpie baby or no deal.” NZ is a dot on the map of global trade. Nobody cares what we think, we need to take care of ourselves.

        • Draco T Bastard 9.2.2.1
          4 March 2018 at 11:16 pm

          The system you link to requires raw iron.

          Yes? So? Still doesn’t require burning of fossil fuels.

          There are many more acres available for growing the material than the volume of iron ore mines in the world and most of the ore extracted is waste.

          And how much can be taken away from growing food before causing a major crisis?

          The more you speak the more you show your ignorance of economics.

          Oh, and all that titanium in our iron sands is probably useful as well.

          Are you suggesting Jacinda march into the oval office, thumps the desk and declares “This is how it’s going to be Trumpie baby or no deal.”

          Nope. I’m suggesting she ignore him.

          I linked the other day to Europe and how they’re working with their privacy laws to bring up privacy laws around the globe by tying them into trade. I’m saying that we do the same thing but with all our laws and that every other country does the same thing. It produces a race to the top rather than the race to the bottom that we’ve had for the last few decades

          • David Mac 9.2.2.1.1
            5 March 2018 at 9:57 am

            Glenbrook has struggled to be a viable steel manufacturing plant for decades. To become a worthwhile GDP contributor in steel manufacturing requires scaling up. How do you think NZers will feel about dumping more of our finite black sand beaches into blast furnaces?

            They can be run on electricity, huge amounts of subsidised electricity. I suspect you’d be one of the 1st to squeal about the sweet electricity deal Rio Tinto get on their mega consumption to make aluminum down South. The trend for electric vehicles is ramping up, the demands on our grid headed skyward. The new Nissan Leaf being launched around the world has a range of 400kms. The new electric Porsche, an 80% recharge time of 15 minutes.

            NZ is very mountainous, most of it not viable for the growing, tending and harvesting of food crops. Hemp, bamboo, not so much. Robotic tracked vehicles could harvest it.

            McFlock raises an important point, currently these composites are held together with a petroleum product. Also, how much of a car or aircraft still needs to be metal? I suspect the body takes the lion share of the steel component, but yep, hemp suspension springs and camshafts seem a bridge too far. I wonder if epoxy products could be made with hemp oil, a potential by-product of the procedure.

            My knowledge of macro economics is limited, yes. The subject bores me. I’m more focused on getting $1000’s of dollars in the door, not millions. But from what I can determine the same basic principles apply. ‘Make stuff, find willing customer, sell stuff’.

            If legislation forces BMW to pay double the price for their steel the increased wages for the men on the floor at Glenbrook will be gobbled up by the increased sticker price of a new 3 series Beemer or Bic ball-point pen.

            I feel we’re not in a position to influence global commodity prices and international trade legislation. I think we’re foolish to try. We don’t need to change or wait for others to alter the rules of the game, just improve our ball skills.

            • Draco T Bastard 9.2.2.1.1.1
              5 March 2018 at 9:20 pm

              Glenbrook has struggled to be a viable steel manufacturing plant for decades.

              Wrong. They’ve been making viable steel for decades.

              What you mean is that they’ve been struggling to be commercially viable and that’s more because of the low wages and working conditions in other countries rather than because of Glenbrook.

              And, no, they don’t need scaling up either. That’s a fiction caused by the improper use of scale.

              I suspect you’d be one of the 1st to squeal about the sweet electricity deal Rio Tinto get on their mega consumption to make aluminum down South.

              Yes. We shouldn’t be subsidising commercial operations.

              I wouldn’t have a problem with it if it was run by the government as an economic pre-cursor operation.

              The trend for electric vehicles is ramping up, the demands on our grid headed skyward.

              Correct, we cannot afford electric cars.

              McFlock raises an important point, currently these composites are held together with a petroleum product.

              Most of them are but more are being produced from a plant base.

              Still, I’m not actually against mining fossil resources. I’m just against burning them and extracting them in an environmentally damaging way.

              My knowledge of macro economics is limited, yes. The subject bores me. I’m more focused on getting $1000’s of dollars in the door, not millions. But from what I can determine the same basic principles apply. ‘Make stuff, find willing customer, sell stuff’.

              Which proves your complete ignorance of the subject. Economics has never been about money but about the very limited physical resources available to us.

              And, no, even when you involve money it’s still not about making stuff, find willing buyer, sell stuff. It’s purpose is to provide a society with what it needs and wants within those limited physical constraints.

              If legislation forces BMW to pay double the price for their steel the increased wages for the men on the floor at Glenbrook will be gobbled up by the increased sticker price of a new 3 series Beemer or Bic ball-point pen.

              And this is a fundamentally wrong ideology. We actually can’t afford for people to have personal cars. That’s what ACC is telling us.

              Raising the price beyond people’s ability to pay for them isn’t a Bad Thing™. It’s simply the market working.

              I feel we’re not in a position to influence global commodity prices and international trade legislation.

              Which is wrong. We’ve had positive influence before, we can do so again. Showing the way by example is usually the best option.

              We don’t need to change or wait for others to alter the rules of the game, just improve our ball skills.

              See, it’s not actually a game. It affects all life on Earth and if we don’t do something to alter course BAU will kill us.

              • David Mac …
                5 March 2018 at 9:52 pm

                I think it’s fantastic that you know 132 different ways to make love Draco.

                It’s a shame you don’t know any women.

    • tracey 9.3
      5 March 2018 at 9:02 am

      Didnt we have to subsidise the global trillion dollar company Rio Tinto? Suggests we havent been competitive in aluminium for a long time

  12. Draco T Bastard 12
    4 March 2018 at 8:28 pm

    If you every wondered why multilateral trade orders exist, you’re about to get your first global lesson in a long time, and it has simply massive implications here in New Zealand.

    I’ve always known the expressed ‘why’ which is that rules across nations need to be equivalent for free-trade to happen. But that doesn’t actually appear to be the real reason. The real reason appears to be fix laws in ways that the corporations want and not allow them to change.

    Thing is, we don’t actually need all those multi-lateral trade agreements.

    All we need is to say that if all of a countries rules are equivalent to ours or better then there are no tariffs. If they are less than ours, then there are.

    This would allow us to set our own rules while also encouraging countries to meet or exceed ours.

    • Molly 12.1
      4 March 2018 at 10:10 pm

      “All we need is to say that if all of a countries rules are equivalent to ours or better then there are no tariffs. If they are less than ours, then there are.”
      But DTB, that won’t take millions of dollars, many junkets, and six thousand pages of legalese. It is too clear, concise, ethical and moral. It would probably burn the hands of any trade lawyer or negotiator that went near it, you know, like holy water and demons…

      On another note, partly because of your “can’t afford the rich” catchphrase, I am currently reading Why we can’t afford the rich by Andrew Sayer. Enjoying the read, and might inflict it on my teenagers to read while they are commuting on the train.

  13. Groundedkiwi 13
    4 March 2018 at 10:18 pm

    Smoke and Mirrors. It is only Trump talking the tariffs at the moment. What a coincidence just prior to the 8th March and the signing of the CPTPPA.

  14. Hanswurst 14
    5 March 2018 at 3:25 am

    Are you an American, or is there some other reason why aluminium is spelt “aluminum” in your first paragraph?

  15. Phil 15
    5 March 2018 at 12:37 pm

    Does anyone want to take a punt on where the U.S. tariffs on steel and aluminum will go?

    Trump will get distracted by something someone says on CNN or at the Oscars and, much like every other toddler I’ve ever met, forget what he was doing five minutes ago.

      • Phil 15.1.1
        5 March 2018 at 6:34 pm

        Mine was a slightly glib comment on Trump’s overall political agenda and its complete lack of coherence. 🙂

        But seriously, looking back over the first year (Christ, it feels so much longer) of the Trump Presidency, there’s basically nothing “Trumpy” that has been achieved. The only legislative win he has is very much a core-republican ideal and was driven by Congress: the tax cuts.

        It’s clear that the White House is not getting and/or is refusing to accept, much help from Capitol Hill. All the high profile Trump-specific (as opposed to generically Republican) campaign promises like the Border Wall, Muslim Ban, and withdrawal from NAFTA, and so on, are either languishing in legal/fiscal debacle or are being so incompetently managed by the White House that they will almost certainly never see the light of day in any meaningful sense.

        At this time, I don’t have much reason to doubt tariffs are in the same camp. If/when we hear full-throat support from Ryan, McConnell and the like, then I’ll believe these tariffs have a better-than-even chance of coming to fruition.

        • Pat 15.1.1.1
          5 March 2018 at 7:03 pm

          do get me wrong …i agree Trump is as a petulant child with the corresponding attention span however he has surrounded himself with ‘yes men’ and I think that someone with Steve Hanke’s likely connections will have a pretty good handle on things (as much as one could with someone like Trump)

          As to his actions in the first year, well he did as he said with TPP, NAFTA ( or at least is in the process if whats coming from the Canadians is an indication) his tax cuts and his Muslim ban hasnt been for lack of trying, rather incompetence and legal action….none of which could be deemed insignificant.

  16. Exkiwiforces 16
    5 March 2018 at 11:31 pm

    Well never trust a word from old Mr Dump. He has piss all over Mal and Bluescope

    http://www.abc.net.au/news/2018-03-05/trump-said-australia-would-be-exempt-from-tariffs/9512612

    • Keepcalmcarryon 16.1
      6 March 2018 at 8:15 am

      “Opposition Leader Bill Shorten said he hoped Mr Turnbull would get on the phone and “at least try” to secure an exemption for Australia.

      Mr Shorten presented the issue as a litmus test for the US alliance.

      “Australia and America have been allies in all sorts of adversity and conflict. I hope at times like this that all of our other friendship counts for something,” he said.”

      There will be some political ramifications.
      I wonder who is going to be dumb enough to sign up for the next “Coalition of the Willing?”

      • Exkiwiforces 16.1.1
        6 March 2018 at 11:39 am

        What’s very disturbing was that there were a number of witness from sides to Dumps promise that Oz and Bluescope would be exempt from tariffs. The other side to this is that Bluescope exports about 25% of its product to the US which is the main reason for Bluescopes massive turnaround as at one stage the companies stock was almost worthless and probably the biggest concern to NZ ATM is Bluescopes NZ operations at Glenbrook?

        I hope this a wake call to both Oz and NZ Governments that US promises are worthless weather its on paper or verbal and the US is not to be trusted

  17. SPC 17
    6 March 2018 at 9:53 am

    Into a conflict between Congress and the POTUS. With Congress having more allies in the White House than POTUS has within Congress.

    The suspension of US soft power, Trump has turned on Americas allies and the Americans will have none while he remains in office. It will be a foretelling of a future when the USA declines into a regional power sans reserve currency status.

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