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White House announces 25 percent tariff on Chinese tech goods

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Re: White House announces 25 percent tariff on Chinese tech goods

#341

Post by defertoreptar »

fspeech wrote: post #338
defertoreptar wrote: post #230

Earlier quoted context omitted.

This goes beyond subsidies. We're talking about espionage, theft, forced technology transfers, and mandatory joint ventures if you want to set up shop in China.

"if you want to set up shop in China" That is a funny line of logic that gets thrown around a lot, considering that the advocates' stated preference is for industries to move out of China. Isn't wide dissemination "about espionage, theft, forced technology transfers, and mandatory joint ventures" enough a deterrence for companies to stop going into China? Apparently not.

> Isn't wide dissemination "about espionage, theft, forced technology transfers, and mandatory joint ventures" enough a deterrence for companies to stop going into China? Apparently not.

You're right, and at the same time, that's not the point. The USA has been granting China favorable deals, which has resulted in trade deficits. The expectation is that the China will at least follow and enforce international trade law. The USA decided that the Chinese government is not doing this and is instead actively subverting it at the expense of US companies. This is a response to that.

Re: White House announces 25 percent tariff on Chinese tech goods

#342

Post by lancewiggs »

defertoreptar wrote: post #161
kinsomo wrote: post #134

Earlier quoted context omitted.

> What I don't understand is the response. The burden of this cost has entirely been placed upon US businesses I don't think that's true, which is proven by the fact that China is strongly opposed to the tariffs and plans to retaliate with their own. China's exports will go down, so it will cost them too.

If the USA goes up 25% and then China goes up 25%, then it will impact China's GDP far more than USA's. China's economy relies much more on trade with the USA than the other way around.

It depends what they apply it to - and we can bet that a lot of thought will go into that.

Re: White House announces 25 percent tariff on Chinese tech goods

#343

Post by warent »

freehunter wrote: post #280
projectileboy wrote: post #100

Earlier quoted context omitted.

It depends a lot on exactly what kind of production facilities we’re talking about moving. Simple plastic injection mold shops? Sure, maybe. Multi-billion dollar chip fab plants? Not so much.

Right. It is extraordinarily difficult to just pack up a high-tech factory and move it to another country. Actually moving the plant and machines is the easiest part, the hard part is the people. Training people to be experts at high tech jobs takes a lot of time, and even then you're losing the decades of experience and the high concentration of likewise experienced and well-trained suppliers nearby. Of course we co…

I'd say the other hard part is finding manufacturers you can trust. You have to think that you're basically exporting company secrets when you manufacture offshore.

Re: White House announces 25 percent tariff on Chinese tech goods

#344

Post by 089723645897236 »

If your company relied on some sort of margin related to commodity electronic components: congratulations you were doomed anyway, this just hastens it. Let's face it, hardware is not where the money is. Hardware is a tool of software now and forever. If you can't figure out how to make the money with software to pay for the hardware then forget it! I hear Amazon is hiring again.

Re: White House announces 25 percent tariff on Chinese tech goods

#345

Post by WhitneyLand »

losvedir wrote: post #263
luma wrote: post #28

I guess my earlier comment was too long, so let me provide a shorter version: this action actively harms anyone attempting to design, prototype, and manufacture electronic devices in the US. There isn't a single component in the projects I'm currently working on which isn't impacted by this. My cost of goods just went up by 25% across the board today in an effort to help "protect" American businesses. I don't feel li…

Your comment proves too much. It would equally apply in the scenario where the foreign country is dumping goods to destroy local competition (i.e. the "Walmart destroys local stores" story writ large). And yet, in that scenario most people would be in favor of tariffs. More generally, as I understand it, the reason economic orthodoxy is against tariffs is because of "comparative advantage", and the idea that differen…

Correct, his comment doesn’t take into account counter scenarios, that’s important to be mindful of.

Nonetheless it’s still illustrative of, as you call it, economic orthodoxy. Put more plainly, most economist say this shits no good. It can be very counterproductive, dangerous even.

Re: White House announces 25 percent tariff on Chinese tech goods

#346

Post by roenxi »

maxwell wrote: post #321
Latteland wrote: post #277

Earlier quoted context omitted.

The US has higher wages than third world countries for most workers and more than China. So for things that take more human labor, we are disadvantaged if we make them. Those things may be cheaper to but and import. Things with more IP behind them or requiring less labor are more likely to be efficiently produced in the US. So importing those goods that can be much more cheaply in say china or mexico saves everyone i…

Why did Henry Ford pay his workers enough to buy Ford vehicles? Why is paying higher wages while keeping the money in the community/country a "disadvantage" exactly? Aren't you looking only at consumption without considering production? Honestly, this sounds like parroted ten year old globalist propaganda. Craft beer has already shot this entire line of argument down, and other industries show signs of beginning to f…

> Why did Henry Ford pay his workers enough to buy Ford vehicles?

Well, the theory was that if his workers could buy his cars he'd make more money.

But that is the same type of logic as selling items at marginal loss and trying to make a profit by moving huge volumes. The fact that it worked so well suggests there was something else going on that I don't know about.

> Why is paying higher wages while keeping the money in the community/country a "disadvantage" exactly? Aren't you looking only at consumption without considering production?

So obviously the absolute number doesn't matter - otherwise we could multiply all dollar figures by 10 at the end of each year and call ourselves wealthy! :D

The relative distribution is everything. The game is to split people up into the nearly-everyone camp who take resources and consume them, and the rare talent camp that can turn resources into more resources. I'll call our rare and talented individuals group 2.

Take a silly example, wood. Give most people wood, and most people can burn it for heat. The more productive individuals can build something out of it, like a house (which is a better long-term investment in terms of conserving heat). Maybe the most productive would turn it into an axe shaft and cut down a few trees, liberating more wood.

The aim of the game is to move as much of societies resources to group 2 as we can reasonably manage, because then we will have massive resource surpluses that we can all enjoy.

"Keeping [resources] in a community" is a fine if your community has a couple of people in group 2 that you can divert them to. Otherwise, you'll find that all your resources get consumed and mysteriously there is no surplus any more. If you give all your resources to productive foreigners, they can give you back the same amount, plus a little extra, and themselves be wealthy. Discovering this little dynamic is the heart of economics.

The downside is that true group 2-ers are rare, and usually busy enough that they aren't very visible. People forget about them and try to divert resources to the deserving but chronically unproductive instead. If it gets extreme, communism happens and everyone starves.

Re: White House announces 25 percent tariff on Chinese tech goods

#347

Post by Latteland »

maxwell wrote: post #321
Latteland wrote: post #277

Earlier quoted context omitted.

The US has higher wages than third world countries for most workers and more than China. So for things that take more human labor, we are disadvantaged if we make them. Those things may be cheaper to but and import. Things with more IP behind them or requiring less labor are more likely to be efficiently produced in the US. So importing those goods that can be much more cheaply in say china or mexico saves everyone i…

Why did Henry Ford pay his workers enough to buy Ford vehicles? Why is paying higher wages while keeping the money in the community/country a "disadvantage" exactly? Aren't you looking only at consumption without considering production? Honestly, this sounds like parroted ten year old globalist propaganda. Craft beer has already shot this entire line of argument down, and other industries show signs of beginning to f…

Henry ford's paying their workers more was considered revolutionary. I am actually in favor of paying people a good living wage, but we have to do something to make it work. I'm a programmer and I bet I make more than someone in India, so I should have to be doing something extra to justify that. I didn't mean to parrot anyone else's ideas, these just seem like obvious idea.

If I was a worker in a factory making things with physical labor, and I have a typical us standard of living, how can I do that more efficiently than someone in china, who gets paid less? I love craft beer, but it's a combination artistic and luxury product. It's not like making ball bearings. It has an aspect of knowing what the micro local market wants. It has a marketing and uniqueness possibly. On the other hand, no one is I know is making craftsman lumber to make houses out of (but they could I guess).

Re: White House announces 25 percent tariff on Chinese tech goods

#348

Post by MrMorden »

kinsomo wrote: post #183
keo93ndn wrote: post #179

You’re considered a consumer of the things this targets Their real concern is protecting the supply side folks. Basically themselves You should only be buying from an American supplier, even though we just spent 30 years shutting them all down Because no one in this admin has a damn clue Factories won’t be growing up out of the grown churning out parts in 6 mos because of this The ignorant are shooting themselves in…

> You should only be buying from an American supplier, even though we just spent 30 years shutting them all down > Factories won’t be growing up out of the grown churning out parts in 6 mos because of this If you wanted to reverse the trend of all the American suppliers getting shut down, and re-build the American manufacturing base, what actions would you take to accomplish that?

Eliminate tariffs (and non-tariff barriers) and convince manufacturers they'll stay gone. Separate health-care payments from employment. Ensure that there's an adequate supply of vocational training. Add two zeroes to housing starts everywhere the median house price exceeds three times the median income. Nothing that isn't patently obvious, in other words.

Re: White House announces 25 percent tariff on Chinese tech goods

#349

Post by WhitneyLand »

crunchlibrarian wrote: post #301
luma wrote: post #28

I guess my earlier comment was too long, so let me provide a shorter version: this action actively harms anyone attempting to design, prototype, and manufacture electronic devices in the US. There isn't a single component in the projects I'm currently working on which isn't impacted by this. My cost of goods just went up by 25% across the board today in an effort to help "protect" American businesses. I don't feel li…

I understand your point and am not in favor of these tariffs, but does anyone else think it's kind of silly that every single chip and component and interface comes out of China? How much of the tech industry goes poof if they decide to stop exporting to the US entirely? Seems like a precarious position. Put another way that might make more sense to your average HN reader: what if all software came out of China like…

It’s a double edged sword. It is a factor that’s considered somewhat in policy but at the same time it very hard to predict and generalize such conclusions because things can also land the other way.

For example it’s possible some permutation of trade war impacted US tech in the short term yet had the long term effect of reestablishing more manufacturing in the US. This kind of thing has happened, lots of examples.

Remember, China is not a manufacturing leader simply because people are working cheaply. There is a masssive ecosystem, self-reinforcing, supporting new growth, and in general making it easy to get things built there. These elements are critical yet not fundamentally tied to wage discussions.

They have fantastic systems and infrastructure in place to make it all possible at this point, that are mostly independent of what salaries are.

I don’t mean to imply wages don’t matter, they do influence things of course. It’s just that they are a highly visible point of contention compared other extremely important enablers that are not very visible to casual observers, who may still be very vocal on these debates.

Re: White House announces 25 percent tariff on Chinese tech goods

#350

Post by tfolbrecht »

Try to understand it strategically.

If there's a 25% tariff on Chinese components, it makes Japanese, Taiwanese, Korean, developing-economy players more competitive. If the tariff is projected to last it will cause a sizable diffusion toward other players. Consider also that tech goods growth is projected to continue and China wants to start fabbing silicon. China doesn't want the brakes pumped on that exponential curve.

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