The Tariff Cost: analysis of the costs to Americans from new tariffs on Canada • Hacker News Board

Re: The Tariff Cost: analysis of the costs to Americans from new tariffs on Canada

#121

Post by rjrjrjrj » Wed, Aug 26, 2026, 9:22 PM UTC

ericmay wrote: post #58

llm_nerd wrote: post #48

Earlier quoted context omitted.

> So how do tariffs come in to play if there are no tariffs applied? What is the duty you pay on duty free goods? Is this a serious question? Canada negotiated in a quota of dairy products the US could export to Canada tariff free. If the US exceeds this quota, there are tariffs. If it doesn't, there are none. It has never even come close to hitting the quota, much less exceeding it, and the total tariffs ever paid o…

> Canada negotiated in a quota of dairy products the US could export to Canada tariff free. If the US exceeds this quota, there are tariffs. If it doesn't, there are none. It has never even come close to hitting the quota, much less exceeding it, and the total tariffs ever paid on this has been $0. So you wouldn't take issue with an America quota on assembled motor vehicles, for example, since that wouldn't be a tari…

> I do take issue with the lack of honesty where folks pretend that we had these free trade schemes without any barriers right up until Trump got elected again. It's simply untrue.

Which folks are these? The original Canada/US free trade agreement was negotiated in the 1980s. It was never a "free trade scheme without any barriers" and I don't recall anyone ever describing it as such. There have always been exemptions, quotas, and points of contention on both sides. Softwood lumber has been in the news for decades, for example.

Your issue with a lack of honesty seems misplaced. Surely you should be more concerned that the White House is occupied by a pathological liar who has surrounded himself with pathological liars, and consequently the US as a whole has a massive global credibility problem?

Re: The Tariff Cost: analysis of the costs to Americans from new tariffs on Canada

#122

Post by usefulcat » Wed, Aug 26, 2026, 9:24 PM UTC

foxyv wrote: post #22

ericmay wrote: post #6

> And Canada is taxing you back This seems illogical. You can't simultaneously claim that the US is paying higher prices for Canadian goods because of US-imposed tariffs and then turn around and say only that Americans are paying a tax on buying Canadian goods on Canadian-imposed tariffs. Both countries are either paying higher prices or paying higher taxes. Canada's tariffs must also be viewed as America is taxing C…

I think the idea is that tariffs cut both ways. They increase prices for foreign goods as well as reduce demand for imports causing job losses in the exporting country. The original tariffs increase prices and the retaliatory tariffs reduce demand for American products causing job loss.

> They increase prices for foreign goods

Not only for foreign goods. If there's a tax on imported X, domestic X producers can now charge more because the foreign producers must raise their prices to pay for the tax.

Another way to look at it is that any tariff reduces foreign competition, with all the knock-on effects that implies.

Re: The Tariff Cost: analysis of the costs to Americans from new tariffs on Canada

#123

Post by maxglute » Wed, Aug 26, 2026, 9:26 PM UTC

bryanlarsen wrote: post #87

maxglute wrote: post #83

LBH, Canada has always been real economy loser with respect US trade with ~80b goods / services deficit AFTER discounted energy - cheap crude sales to US to fuel US refinery mismatch. US doesn't have strategic domestic energy self sufficiency without Canadian crude, CAN sludge should be selling at premium (same with VZ but we see how that went). In an ideal world Canada could be making more refining and selling high…

USMCA (and the 2 deals that preceded it) are definitely better deals for the US than they are for Canada. But they're fairly generally believed to be win-win deals; it's just that the US wins more than Canada. If you're playing a single football game, the lesser winner is the loser. However, the economy is not a single football game. In real life the lesser winner is still a winner.

>generally believed to be

Generally believed by orthodox economics whose credibility is not so hot. CUSFTA, NFTA, USMCA... there was brief decade in 90s with CUSFTA integration where rising water lift all boats, but realistically Canadian growth in 00s was on the back of commodity supercyclic and inflated real estate. In real life the winner takes home $10000 cheque, the second/third winners take home participation ribbons, and sometimes they come home battered and bloodied (US buyouts in highend because CAN champions lack of scale never could compete once barriers gone ). In real life the lesser winner still has to look at opportunity cost of playing the game in the first place. Was there a more profitable game where runners up get $5000? Which is not to say participation trophy was not the optimal play, i.e. the opportunity cost of not joining common industrial base might have been more detrimental, maybe global capital wouldn't enter Canada in first place, maybe not playing = atrophy at home. But surviving + participation prize winner not the same as a take cheque home winner.

Re: The Tariff Cost: analysis of the costs to Americans from new tariffs on Canada

#124

Post by tensor » Wed, Aug 26, 2026, 9:28 PM UTC

ericmay wrote: post #105

footy wrote: post #98

Earlier quoted context omitted.

> Let's set the framing correctly because I think we're starting off on the wrong foot. The US is not in a desperate need of any product from Canada. Nice to have and super important? Yea. Desperate? No. Not by any stretch of the imagination. aluminium, potash, and electricity are more than "nice to have"s

Yea but we can find other sources or just do with less if we had to just like any other country can. Remember when Russia invaded Ukraine? Did Europe figure out a way to do without Russian products? I'm not sure why folks seem to think the US can't also figure things out if it so choses.

"I'll just get it from somewhere else" means you do need it. This isn't complicated logic. You don't have enough yourself. The fact that you hope you could get it from a brutal dictatorship instead of a democratic country doesn't change the fact that you do need things Canada has.

And yes, Europe found a way off Russian gas. But they had to ration energy, hallways went cold, lighting was restricted. It was not fun. You want to ration food and heat? And for what exactly? What do you gain from it? Have fun.

Re: The Tariff Cost: analysis of the costs to Americans from new tariffs on Canada

#125

Post by SmirkingRevenge » Wed, Aug 26, 2026, 9:30 PM UTC

NoidFonsense wrote: post #54

sobellian wrote: post #49

Imagine you want to build a factory in the US. You pay tariffs on the factory equipment you need - much of it is made overseas. You pay tariffs on your input goods. And then when you try to export your customers get hit with a retaliatory tariff. I don't agree with tariffs but even if we accept some level of protectionism you can't tariff everything the way this administration wants. You have to pick what you actuall…

I totally disagree. The same factory would be made infeasible without the tariff. What do we need that shouldn't make domesticially?

Tariffs hurt domestic manufacturing for a number of reasons, but one of the major ones is because something like 50% of our manufacturing inputs are imported.

Re: The Tariff Cost: analysis of the costs to Americans from new tariffs on Canada

#126

Post by tensor » Wed, Aug 26, 2026, 9:32 PM UTC

ericmay wrote: post #86

llm_nerd wrote: post #71

Earlier quoted context omitted.

> So what? You specifically chose a thing that Trump has tried to use as a lever multiple times. Again, I want 100% of vehicle production from the US barred from Canada. A 0 vehicle quota. Let the US automakers collapse into the eventual failure that is coming. > We could still enact a quota on imports regardless of exports. Huh? What does this even mean. When there are two parties to an agreement. If the US did that…

US automakers wouldn't collapse if Canadiens weren't buying American cars. Canada is too small of a market. On the other hand Canada would lose a lot of jobs. It also wouldn't apply to just American auto manufacturers. Japanese and German manufacturers I imagine ship cars to Canada too so you wouldn't get those either. > Huh? What does this even mean. Well we would enact a quota on imports, and then we'd be free to e…

Maybe you haven't noticed the world turning against you. Canada is forming trade agreements rapidly with other countries. We can get cars from anywhere in the world. You, on the other hand, would only be able to get cars from yourself. If you ban imports other countries will ban your exports. Isolationism is a losing philosophy. The best and wealthiest nations are the ones that do the most trade, not the least.

Re: The Tariff Cost: analysis of the costs to Americans from new tariffs on Canada

#127

Post by yostrovs » Wed, Aug 26, 2026, 9:35 PM UTC

Throaway826 wrote: post #84

ericmay wrote: post #70

Earlier quoted context omitted.

Someone else shared this article [1] and I was reading a quote I thought was interesting: “[Canada] has a large dairy producing constituency that it wants to protect, so they put a cap on imports that can be accessed at a competitive rate. That's what we call a ‘TRQ’ (tariff rate quota),” says Becky Rasdall Vargas, senior vice president of trade and workforce policy at the International Dairy Foods Association. Under…

The main reason the Dairy Supply quota is in place is to stop US dairy producers from dumping dairy into Canada. That's why the USA has never reached the tarriff limit. The big producers there would just dump 20 million litres at once if they could. They aren't interested in 1 or two. And if they were able to do that, the Canadian producers would go under. So its kinda simple, the Dairy Supply system is there to prot…

It follows then that the USA also wants to protect its industries, such as timber, oil and gas, and maple syrup, from Canadian producers that are happy to dump their stuff south of the border for cheaper than US competition.

Re: The Tariff Cost: analysis of the costs to Americans from new tariffs on Canada

#128

Post by jgilias » Wed, Aug 26, 2026, 9:37 PM UTC

bryanlarsen wrote: post #57

kevin_nisbet wrote: post #34

Earlier quoted context omitted.

I've seen this point in a few different places and I don't know that it's understood as widely as it should be. So just to expand on why that's the case. As a net producer of energy right now, the US produces more than it consumes. This is why it get's pointed out, that as a net producer, the trade deficit with Canada is also a surplus (or reduction in deficit) on the other side with other countries. Yes it may not b…

Another poster pointed out that Trump is complaining about the trade deficit at the same time he's trying to increase that trade deficit by building the Keystone XL pipeline....

That’s not surprising. He’s, like, really dense.

Re: The Tariff Cost: analysis of the costs to Americans from new tariffs on Canada

#129

Post by HWR_14 » Wed, Aug 26, 2026, 9:45 PM UTC

epolanski wrote: post #85

sobellian wrote: post #49

Imagine you want to build a factory in the US. You pay tariffs on the factory equipment you need - much of it is made overseas. You pay tariffs on your input goods. And then when you try to export your customers get hit with a retaliatory tariff. I don't agree with tariffs but even if we accept some level of protectionism you can't tariff everything the way this administration wants. You have to pick what you actuall…

Protectionism and tariffs simply don't work in the global world. Capitalism will keep producing things where they make sense not where politicians want. Exceptions make sense only to protect industries that are absolutely vital and critical for security. Ship building should be one of those for countries like US or UK. Or when you want to kickstart an industry and need to protect it for a limited amount of time (Kore…

I'm having a hard time thinking about what products aren't "vital and critical for security". I guess toys?

Re: The Tariff Cost: analysis of the costs to Americans from new tariffs on Canada

#130

Post by magicalhippo » Wed, Aug 26, 2026, 9:47 PM UTC

spacemule wrote: post #29

Am I the only one who finds this site undecipherable? Take this snippet for example: American exporters $16.0B of what American exporters sell to Canada sits in headings Canada taxes today, 10.5% of the total. From 8 September it is $26.5B. See whose jobs What does "sits in headings Canada taxes" mean? Whatever this means, how does it jump to $26.5B from $16.0B on a single date? Don't things have to enter for tariffs…

> What does "sits in headings Canada taxes" mean?

My guess would be it's refering to the Harmonized System[1], used to classify goods on import and export declarations:

The HS is organized into 21 Sections, which are subdivided into 96 Chapters (Chapters 1 to 97 with Chapter 77 reserved for potential future use by the HS). The 96 HS Chapters are further subdivided into 1,228 headings and 5,612 subheadings in the current 2022 edition of the HS.

Most countries have additional subdivisions, for example in US the HS is used as a basis for the Harmonized Tariff Schedule[2].

The classification is used to determine tariffs, taxes and restrictions, but those are often applied to the broader groups, so covering say all imported aluminum, rather than say aluminum of a particular kind for use in a particular sector.

> Whatever this means, how does it jump to $26.5B from $16.0B on a single date?

Because Canada announced it will impose tariffs on more types of goods on that day, ie more headings, affecting more of the exported value.

[1]: https://en.wikipedia.org/wiki/Harmonized_System#Structure

[2]: https://hts.usitc.gov/