61–70 of 385 posts
Are tariffs just straight up revenue for the US government, like income taxes?
Yes, but it is relatively small amount of revenue. Even with the new 10% tariffs on extra $200B, China tariffs in total will be less than 3% of federal government revenue.
As much as some people here may hate Trump, the fact is that he was right when we said that it is difficult for us to lose a trade war with China since we import more from them than we export. Is there going to be some short term pain? Absolutely! But, long term it is likely to create more jobs in the US. As an extra bonus, there won't be as much of a carbon footprint for shipping things half way around the world and…
We won’t lose more than China does, but we’re still going to lose a fair amount of wealth and standard of living.
Earlier quoted context omitted.
It would no doubt be disruptive, temporarily. And it would also prompt a multi hundred billion dollar redirection of investment into moving those supply lines to other countries. Vietnam would love to get some more of China's tech manufacturing action, as would a dozen other developing countries. Others would welcome gains to be had in apparel or autos by moves like that by China. One of the biggest problems China ha…
I’m not sure. Tim Cook seemed to suggest the iPhone couldn’t be manufactured anywhere else.
As much as some people here may hate Trump, the fact is that he was right when we said that it is difficult for us to lose a trade war with China since we import more from them than we export. Is there going to be some short term pain? Absolutely! But, long term it is likely to create more jobs in the US. As an extra bonus, there won't be as much of a carbon footprint for shipping things half way around the world and…
His trade war with China (and only China) is one of the few administration's positions I whole wholeheartedly support (as a economics dilettante, no expert).
A big part of the rationale with all of these little trade wars is to make China stand alone on the global stage, so that they are more easily negotiated with. A secondary effect is to eliminate "Made in $country" goods that are 90% manufactured in China and finished in e.g. Italy or Canada.
Earlier quoted context omitted.
The EU does indeed have the same issues. The single best move Trump can make, is to resolve NAFTA (looks likely), then strike a deal with the EU (also looks likely), along with Japan (up in the air). The EU has very openly stated that they have the exact same problems with China as the US does. They couldn't any further telegraph their interest in conspiring with the US to tame China's abuses. Indeed it may be the on…
Which is also why it's absurd the EU goes out of their way to distance them from the US because of Trump. He is in the right on this one despite his style but sometimes that's what you need.
>Proponents of the plan say letting Washington impose more tariffs than Beijing would actually hurt the United States more because tariffs are ultimately paid by consumers and businesses in the countries that levy them. Well, this is actually the fundamental problem, isn't it? There's no way actual trade evens out, so tariffs are the only real outcome here. Even if we "win", it's not actually winning.
Additionally when we import from China, we pay with dollars. China can either buy US goods with the dollars, or buy US assets (typically Treasury bonds) with the dollars. If you end the trade surplus with China, you end a cheap source of funding for the US government. Not clear if this is a feature or a bug.
Second, it is impossible for a foreign nation to "fund" the U.S., which is a currency issuer. Rather, because we have open capital markets, we allow foreigners to purchase U.S. assets -- something that most other nations don't allow, including China. What this means is that there is a demand for dollars other than the trade demand, but an asset demand. This allows trade deficits to occur.
If you want to stop trade deficits, then don't impose tariffs, but do what China does and ban capital inflows. With no foreign capital inflows, there are no trade deficits -- the golden rule of international trade is that the changes to the capital account plus the changes to the current account must equal 0. No change to one implies no changes to the other, as a mathematical identity.
The way to understand this mathematical relationship is that when the rest of the world sells a good to the U.S., it gets a dollar, and now it has a choice of using that dollar to buy an asset or using it to buy a good. If it is very hard to buy assets, then you buy a good. In this way, the exchange rate adjusts so that the rest of the world doesn't have a trade deficit or surplus.
The reason why you want balanced trade is that when the foreigner gets a dollar by selling a good, but doesn't spend the dollar on buying an american good, then american economy has 1 dollar less income and it needs to sell off $1 of an asset. Selling assets does not produce income but selling goods does produce income. This is why nations like China basically ban selling assets to foreigners and so it's impossible for them to have trade deficits. There are very few nations that have the open capital markets of the U.S. -- really no nation, and our unique policies on capital are why we have such a uniquely large trade deficit.
Earlier quoted context omitted.
Also Foxconn could move ops back to Taiwan, albeit a bit expensive labor wise.
But still cheaper than the US. I don't see iPhones being made in the US anytime soon, there are many places in Asia other than China that would be higher up the list than the states.
That said the main point is Foxconn could move production to other manufacturing centers, if need be, though it would need some transition period to avoid disruption.
Donald Trump was right about one crucial thing. The leaders of most other nations just don't have any backbone.
The biggest problem with modern representative democracies is that they tend to be myopic.
As much as some people here may hate Trump, the fact is that he was right when we said that it is difficult for us to lose a trade war with China since we import more from them than we export. Is there going to be some short term pain? Absolutely! But, long term it is likely to create more jobs in the US. As an extra bonus, there won't be as much of a carbon footprint for shipping things half way around the world and…
His trade war with China (and only China) is one of the few administration's positions I whole wholeheartedly support (as a economics dilettante, no expert).