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American importers and consumers bear the cost of 2025 tariffs: analysis

kielinstitut.de

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Re: American importers and consumers bear the cost of 2025 tariffs: analysis

#11

Post by FrustratedMonky »

duxup wrote: post #8

We will see if SCOTUS majority decides tariffs are a tax or not and push the absurdity of their position even farther. I fear that they already decided that issue when they chose not to intervene and now have the excuse of "lol well can't undo it now" ready to go. Edit: It appears Trump & Co intend to replace SCOTUS if they lose the tariffs ruling ... https://www.nytimes.com/2026/01/19/us/politics/trump-tariffs... --…

I remember the justification for Obama Care was by calling it a 'type of tax'. Which actually was the reason to negate the rights argument at the time, they were using to cancel it. The government is allowed to create 'taxes', and since it was a 'type of tax', it is allowed.

Re: American importers and consumers bear the cost of 2025 tariffs: analysis

#12

Post by energy123 »

yabones wrote: post #7

American trade policy has gone so far in the direction of Mercantilism that both the Neoliberal and the Keynesian economists can agree on something. That's not a good thing.

Mercantilism is bad in itself, but the unpredictably is another special factor, leading to lower business confidence and lower investment. Why would anyone do anything when the rug might get pulled? Better to save and wait a few years. It's no surprise the US is seeing weak manufacturing investment.

Re: American importers and consumers bear the cost of 2025 tariffs: analysis

#14

Post by quakeguy »

diydsp wrote: post #10
dsr_ wrote: post #5

Earlier quoted context omitted.

Then it was a big win for Putin and his agent in the White House.

Ive done a lot of analysis on the Trump as Putin agent topic. I found he nearly as often acts agents Russia as with. What's more likely is he treats Putin as an inspiration, wrt to converting the country to an oligarchy and offshoring national funds for himself.

*acts against

Re: American importers and consumers bear the cost of 2025 tariffs: analysis

#15

Post by empath75 »

How could that possibly have not been the case. A tariff is no different from the cost of any input into the price of a finished good. There is some sense in which price increases are limited by supply and demand, but if the market won't pay for the production cost of the good, then the market will cease to provide that good. There are only two possible outcomes, long term -- either the price goes up, or the product becomes unavailable.

There's an argument that domestically produced goods would substitute for imported goods leaving the market, but markets are so global and intertwined now that even domestic goods have imported inputs that are also affected by tariffs, and there often are no domestic goods or not enough domestic goods produced to act as a price-competitive substitute, and companies are not going to invest a ton of money into expanding domestic capacity, when tariffs are imposed on the whim of a lunatic and will probably be eventually tossed out by the supreme court or congress.

Re: American importers and consumers bear the cost of 2025 tariffs: analysis

#16

Post by duxup »

FrustratedMonky wrote: post #11
duxup wrote: post #8

We will see if SCOTUS majority decides tariffs are a tax or not and push the absurdity of their position even farther. I fear that they already decided that issue when they chose not to intervene and now have the excuse of "lol well can't undo it now" ready to go. Edit: It appears Trump & Co intend to replace SCOTUS if they lose the tariffs ruling ... https://www.nytimes.com/2026/01/19/us/politics/trump-tariffs... --…

I remember the justification for Obama Care was by calling it a 'type of tax'. Which actually was the reason to negate the rights argument at the time, they were using to cancel it. The government is allowed to create 'taxes', and since it was a 'type of tax', it is allowed.

I think the opposition wanted to toss the entire ACA system calling it a tax. However, SCOTUS took a more piecemeal approach than the opposition wished and removed the bit they felt was a tax and left the ACA unaffected generally.

Re: American importers and consumers bear the cost of 2025 tariffs: analysis

#20

Post by nozzlegear »

philk10 wrote: post #4
ungreased0675 wrote: post #2

> Event studies around discrete tariff shocks on Brazil (50%) and India (25–50%) confirm: export prices did not decline. Trade volumes collapsed instead. What if that was the intended result?

your question implies that the person in charge of tariffs has any idea of the effect of using them...

Bob Woodward's book Fear: Trump in the White House made it pretty clear that Trump (in his first term) either did not understand how trade works between countries or did not care. At the time he was singularly focused on "trade deficits," especially the one between the US and South Korea, because on paper it seemed like the US was "losing" or "being taken advantage of" by South Korea. That was all he cared about, reducing that trade deficit so the US came out on top.
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