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The Largest US Trading Partners All Put Higher Tariffs on the US Than Vice Versa

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Re: The Largest US Trading Partners All Put Higher Tariffs on the US Than Vice Versa

#41

Post by EvilEndures »

commandlinefan wrote: post #40
resters wrote: post #33

For the benefit of HN readers, no serious economist supports tariffs in any form. Tariffs appeal to the naive idea that trade imbalances between two nations are a bad thing. They simply are not a bad thing. But due to the political history of tariffs it becomes possible for politicians to claim (falsely) that tariffs will benefit the economy, when in fact they are (at best) a handout to specific industries. What real…

> traditionally have frowned upon receiving welfare You weaken your (otherwise solid) argument when you do that. Tariffs and welfare are two different things, and you know that, and everybody reading this knows that, but you try to sneak in a conflation anyway. They're both bad, but they're bad for different reasons: accepting that taxation is a necessary evil (I'm not sure I do, but set that aside), welfare involves…

> They're both bad, but they're bad for different reasons: accepting that taxation is a necessary evil (I'm not sure I do, but set that aside), welfare involves paying out of tax revenues into individuals pockets. Tariffs are exactly the opposite - tariffs involve increasing tax revenue by collecting taxes on imports, and then using that tax revenue for whatever you use all the other tax revenue for.

If Mr. Widget isn't competitive at $100 vs. imports sold at $90, and you add a tariff of $10 so its "competitive", suddenly Mr. Widget's sales will increase. The other country, knowing their widgets aren't competitive (except $$ wise) then tariffs something like solar panels to protect a nascent solar panels industry.

Tariffs are a form of welfare for domestic corporations. Creating a new Mr. Widget on the assumption that tariffs will remain the same is an expensive gamble you take only if you are sure your widgets are better than Mr. Widget's widgets.

Subsidized loans (i.e. "The Bank of Boeing") are another example of welfare for domestic corporations.

Re: The Largest US Trading Partners All Put Higher Tariffs on the US Than Vice Versa

#42

Post by reaperducer »

resters wrote: post #33

For the benefit of HN readers, no serious economist supports tariffs in any form. Tariffs appeal to the naive idea that trade imbalances between two nations are a bad thing. They simply are not a bad thing. But due to the political history of tariffs it becomes possible for politicians to claim (falsely) that tariffs will benefit the economy, when in fact they are (at best) a handout to specific industries. What real…

For the benefit of HN readers, no serious economist supports tariffs in any form.

I'm not going to pretend to be an economist, serious or otherwise, so I won't dispute this notion.

Tariffs appeal to the naive idea that trade imbalances between two nations are a bad thing.

This, however, needs some augmentation.

Tariffs are a tool. Like most tools, they can be used multiple ways.

Tariffs aren't only for balancing trade. The most common use is to punish another country economically for engaging in an action, such as doing business with the wrong people, or imposing other tariffs.

Tariffs are also used to create jobs. To me, this is the most important function of a tariff, and one which the current American has very visibly implemented repeatedly.

A high import tariff on a particular type of product can help create jobs in that sector domestically.

There are vast numbers of people in every nation who are not able to — and will never be able to — code a program, or invest in the stock market, or found a startup, or work a robot assembling a car. But they can snap plastic forks off of a mold in a factory, or drive a forklift in an aluminum plant, or mix the concrete that paves the roads you drive on every day.

These are actual, real human beings who deserve to have jobs and dignity.

In SV this these people are often dismissed as undesirables who just need to be "re-trained." But a significant percentage of the population cannot be re-trained, for various reasons ranging from mental capability to physical limitations to family obligations to things you an I will never experience.

The real re-training that has to happen is in the chattering internet classes who think the majority of the nation is like them, and it's OK to leave everyone else behind because... progress.

A tariff won't create the next American entrepreneur. But if it keeps 10,000 people from becoming homeless, I'm all for that.

Re: The Largest US Trading Partners All Put Higher Tariffs on the US Than Vice Versa

#43

Post by lrajlich »

resters wrote: post #33

For the benefit of HN readers, no serious economist supports tariffs in any form. Tariffs appeal to the naive idea that trade imbalances between two nations are a bad thing. They simply are not a bad thing. But due to the political history of tariffs it becomes possible for politicians to claim (falsely) that tariffs will benefit the economy, when in fact they are (at best) a handout to specific industries. What real…

While no economist is yet advocating tariffs, except perhaps Peter Navarro (who's not taken that seriously), the attitude among economists that free trade is unequivocally a good thing is starting to change. There is traction for the work of David Autor where he argues that the effects of trade are unevenly distributed and thus some people do not benefit from free trade. The policy ramifications of this gaining traction could wind up with economists favoring tariffs in some cases.

The grocer example isn't really applicable. We both use the same currency so the grocer can use the local currency I pay for groceries to buy goods elsewhere or pay their employees. With foreign trade you have different currencies and a current account, the trade equation isn't as straightforward. An accurate analogy would be buying groceries via a barter system where I'd exchange good or services for groceries or a promise for future goods or services (eg, "luke-bucks") in exchange for groceries.

Re: The Largest US Trading Partners All Put Higher Tariffs on the US Than Vice Versa

#44

Post by joekrill »

resters wrote: post #33

For the benefit of HN readers, no serious economist supports tariffs in any form. Tariffs appeal to the naive idea that trade imbalances between two nations are a bad thing. They simply are not a bad thing. But due to the political history of tariffs it becomes possible for politicians to claim (falsely) that tariffs will benefit the economy, when in fact they are (at best) a handout to specific industries. What real…

Doesn't this all assume that all trading partners are being fair and honest, though?

For example, let's say a country artificially keeps prices low for microchips in an effort to infiltrate the US market (for whatever underlying reason). Or some other country's clothing is super-cheap because they use forced labor.

I'm no economist, and I'm not even well-versed in the subject. I don't even know if these are real-world scenarios. But it's things like this that have always bothered me when people advocate for straight-up libertarianism, or complete lack of government oversight. Because there are always people who don't play fair.

Re: The Largest US Trading Partners All Put Higher Tariffs on the US Than Vice Versa

#45

Post by gxs »

resters wrote: post #33

For the benefit of HN readers, no serious economist supports tariffs in any form. Tariffs appeal to the naive idea that trade imbalances between two nations are a bad thing. They simply are not a bad thing. But due to the political history of tariffs it becomes possible for politicians to claim (falsely) that tariffs will benefit the economy, when in fact they are (at best) a handout to specific industries. What real…

>>>They simply are not a bad thing.

Not being antagonistic hear - but your sentence reads like you meant it in absolute terms, as if they are never a good thing.

That's quite a claim - can you elaborate on it? Your post gives a trivial example, would be great to hear your actual reasoning.

Re: The Largest US Trading Partners All Put Higher Tariffs on the US Than Vice Versa

#46

Post by brentjanderson »

commandlinefan wrote: post #40
resters wrote: post #33

For the benefit of HN readers, no serious economist supports tariffs in any form. Tariffs appeal to the naive idea that trade imbalances between two nations are a bad thing. They simply are not a bad thing. But due to the political history of tariffs it becomes possible for politicians to claim (falsely) that tariffs will benefit the economy, when in fact they are (at best) a handout to specific industries. What real…

> traditionally have frowned upon receiving welfare You weaken your (otherwise solid) argument when you do that. Tariffs and welfare are two different things, and you know that, and everybody reading this knows that, but you try to sneak in a conflation anyway. They're both bad, but they're bad for different reasons: accepting that taxation is a necessary evil (I'm not sure I do, but set that aside), welfare involves…

"Welfare" in this sense could mean imposing artificial limits on competition. The domestic industry receiving the shelter of the tariff benefits from increased supply. Although not a direct handout of cash, the industry benefits all the same. The benefits from a tariff for a domestic industry should be short lived. In the long run, tariffs hurt everyone.

The administration has also set aside $12 billion to relieve farmers hurt by the tariffs. [1] This money could come from the money generated by the tariffs, making it look more like a handout.

[1] https://www.npr.org/2018/07/24/631953880/trump-administratio...

Re: The Largest US Trading Partners All Put Higher Tariffs on the US Than Vice Versa

#47

Post by s73v3r_ »

commandlinefan wrote: post #40
resters wrote: post #33

For the benefit of HN readers, no serious economist supports tariffs in any form. Tariffs appeal to the naive idea that trade imbalances between two nations are a bad thing. They simply are not a bad thing. But due to the political history of tariffs it becomes possible for politicians to claim (falsely) that tariffs will benefit the economy, when in fact they are (at best) a handout to specific industries. What real…

> traditionally have frowned upon receiving welfare You weaken your (otherwise solid) argument when you do that. Tariffs and welfare are two different things, and you know that, and everybody reading this knows that, but you try to sneak in a conflation anyway. They're both bad, but they're bad for different reasons: accepting that taxation is a necessary evil (I'm not sure I do, but set that aside), welfare involves…

I strongly disagree. Tariffs and welfare are both ways that the same thing manifests itself. They're both government handouts; just one is to those who are destitute, and one is to the wealthy.

Re: The Largest US Trading Partners All Put Higher Tariffs on the US Than Vice Versa

#48

Post by s73v3r_ »

zip1234 wrote: post #30
wpietri wrote: post #11

Earlier quoted context omitted.

In which case, I'd much rather we increased taxes on income and/or wealth to a) help workers move up the value chain, and b) provide a safety net for people who lose out on trade. A tariff on "cheap shit from Amazon" is a heavily regressive tax, and acts to reduce total delivered value. Whereas taxing the well-off to pay for education and encourage investment increases total delivered value.

How does taxing the well-off to pay for education encourage investment?

An increased supply of high skill workers? An increased supply of people who are economically secure, and thus not interested in "eating the rich"?

Re: The Largest US Trading Partners All Put Higher Tariffs on the US Than Vice Versa

#49

Post by jethro_tell »

HillaryBriss wrote: post #31
DenisM wrote: post #26

Tariffs are backdoor wealth redistributon in some sense. Hear me out. US export industries are more high tech with higher wages, imports are comparatively low tech. When US imposes tariffs it creates low-tech jobs in the US. When the trade partners impose tariffs they destroy high tech jobs in the US. The net result is high tech jobs lost, low tech jobs gained. Overall economic efficiency goes down due to loss of hig…

> When US imposes tariffs it creates low-tech jobs in the US. I can kind of follow your argument. I can see how it might be true for, say, the recent US steel tariffs (although I don't know enough to say that steel production is 'low tech' these days). But, in general, doesn't your argument depend upon which mix of goods the US includes in the tariff? I mean, I wouldn't call car engines, cell phones, memory chips, te…

>I wouldn't call car engines, cell phones, memory chips, television sets, game consoles, etc 'low tech' but the US imports a good deal of them.

Making them is pretty low tech, there's a team of people that design machines, robots, and human processes to manufacture the parts. That would be high tech but it's not that many jobs, and many of those jobs were already here. Then, there's a few people to get the stuff the robots can't do, and a couple guys to grease the robots, and a couple guys to maintain the conveyors and such. None of those are really high tech jobs. The senior machinery tech and the senior robotics guy and a sysadmin may be 'high tech' but most of the work, even working with the robots, is swaping parts, lubing and calibrating. And that, while it pays more than the floor workers, is still far below what we would think of as a high tech salary.

Re: The Largest US Trading Partners All Put Higher Tariffs on the US Than Vice Versa

#50

Post by anomatopoeia »

lrajlich wrote: post #43
resters wrote: post #33

For the benefit of HN readers, no serious economist supports tariffs in any form. Tariffs appeal to the naive idea that trade imbalances between two nations are a bad thing. They simply are not a bad thing. But due to the political history of tariffs it becomes possible for politicians to claim (falsely) that tariffs will benefit the economy, when in fact they are (at best) a handout to specific industries. What real…

While no economist is yet advocating tariffs, except perhaps Peter Navarro (who's not taken that seriously), the attitude among economists that free trade is unequivocally a good thing is starting to change. There is traction for the work of David Autor where he argues that the effects of trade are unevenly distributed and thus some people do not benefit from free trade. The policy ramifications of this gaining tract…

Yes this is critical - free trade benefits the economy/country as a whole but the benefits do not accrue evenly across society.

Laymen have basically been saying this for years while being ignored by the ruling elites but economists have been slowly starting to get on board.

Even post Trump I suspect that the global attitude toward free trade will become much more nuanced than it had been over the past 20+ years.

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