Will Canadian Boycott Start with Kentucky Whiskey?

This article was first published by me on Talkmarkets: https://talkmarkets.com/content/us-markets/will-canadian-boycott-start-with-kentucky-whiskey?post=179219&uid=4798

It is interesting to look at the products that Canada may decide to boycott if the trade war with Canada heats up. This boycott may be the only thing that shows Donald Trump that he is not winning. This boycott could end up saving America and Canada a lot of pain in the future but boycotts hurt.

While we hope things don't get so bad in Canada with trade tariffs that boycotts are needed, certainly they are a tool that could bring restraint to governments that are perceived to be out of control.

We know Donald Trump thinks that a pending trade war is just about leaders. That shows a misplaced arrogance. Boycotts can work and are a patriotic action. But they should be a last resort action if leaders fail to act.

Shot of Whiskey Author Guinnog

Boycotting Whiskey

Boycotting whiskey could be the most effective of all boycotts. Whiskey was popular, died, and now is popular again. I have adult children who have enjoyed the Kentucky Bourbon Trail. Whiskey sales are soaring around the world. A boycott would be fairly easy to accomplish. Not only Canada, but the whole world could engage in it. The bottles are labeled. It is not difficult to determine origin.

Since the senate majority leader, Mitch McConnell, has buried his head in the sand regarding warnings of worldwide tariffs coming to Kentucky bourbon whiskey, a boycott may be the only way to get him to move.  The state of Kentucky could be financially decimated if Canadians bought their own whiskey and if it spread to other nations. Whiskey is not the most expensive product to boycott, but would affect the most powerful senator!

Thirteen distilleries owned by 8 companies produce 99 percent of the whiskey produced in the United States. Ten of those distilleries are located in Kentucky. Kentucky produces 95 percent of the bourbon whiskey, which is corn based, in the world. There are other whiskeys produced in Kentucky and in other states, and these include rye whiskey, scotch whiskey, etc. These are all potentially subjects of a boycott.

While no one wishes that financial disaster to befall Kentucky, a beautiful state and home of the Kentucky Derby, perhaps the threat of same would get Mitch to force his senate membership to act.
Because of McConnell bourbon is being singled out for boycott on the internet. Some Canadians, from comments I have viewed on the subject, are making plans to change their buying habits.

The silence of Republicans to the Trump tariff ramp up has been disturbing and disturbingly weak. McConnell, so far, has only wanted to attach an amendment to legislation, but news organizations in Kentucky like the Courier-Journal have called for him to introduce a stand alone bill to stop the tariff process.

The Courier-Journal makes this impassioned plea to the Republican leader:

What does the adversarial tit-for-tat likely mean for Kentucky, which produces about 95 percent of the world’s bourbon? Jobs could be lost; manufacturers may see slowdowns; and there could be a crippling effect on the booming bourbon-related tourism industry.
So far, the Senate Majority Leader is timidly pushing back against the White House and Trump’s plan to slap tariffs on American allies.

Trump and Navarro Are Not Facing Reality

Trump and his trade adviser, Peter Navarro are not facing reality and they are dangerous men. They are not only dangerous men, but one could make the case that they are deluded men as well. They need to be weakened, politically, for the protection of the American consumer according to free traders everywhere. Sure, they have gained support from some far left union leaders. It is not the party, but the ideas, that make Trump and Navarro so dangerous.

I wrote a comment to Canadian professor, Norman Mogil regarding both men:

During his interview with Chris Wallace, Navarro said he was going to upset the global order. He said:"And my job at the White House is to help the president get jobs, good jobs, manufacturing jobs to the working men and women of America, and we can't do that unless we upset this existing world order, which basically is tremendously biased." (Emphasis added by me)
He previously said no country would retaliate for the trade sanctions on steel and aluminum. He thought it would be a win for Trudeau that Trump even go to Canada. What is that guy smoking? He is a very dangerous man. Very dangerous.
Then Trump says, "we have a world to run". How about he run his nation and leave others to put their nations first as well. These guys in the white house are radicals. They want to upset the existing world order. That will devastate farming in America, and will devastate the job prospects for millions of people. And it will raise prices and manifest the inefficiency of protectionism, Prof.

Upsetting the existing world order, wanting to see Trudeau burn in hell, and the rude way of treating the Canadian hosts shows a lack of understanding of Canadians by the American leaders.

As Professor Mogil, a contributor to Talkmarkets, has said, Canadians are polite. Now we see that this politeness cannot be mistaken for weakness. Trump and his minions have done exactly that. They were "stabbed in the back" by kindness. Trump's policy, by reading Navarro's comments, proves that he expected the trading partners to fold. That was a major assumption embedded in his plan.

How will he save face? He will get even if he can.

And don't think that the idea of boycott of bourbon has not been entertained. There is already extensive discussions on replacement Canadian whiskey for those who choose to begin the boycott. One large discussion is seen on Reddit, which has promoted bourbon as well. 

Mitch McConnell had better act fast to head off this debacle which is likely now beginning in his state. The exchange traded fund, WSKY, made up of mostly American companies, looks like a sell at the moment, but may become a buying opportunity once trade wars settle down.

Larry Kudlow has been reported to have had a heart attack. He is also an economic adviser to Donald Trump. It seems like a free trade guy like Larry has no place in the Trump Administration. Most fans of business news hope for his speedy recovery.


Popular posts from this blog

Learn Economics

The Unholy Alliance of Big Banking, Neocons, Big Media and Israel

John Mauldin Discusses What Could Go Wrong