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US companies, consumers are paying for tariffs, not foreign firms

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Re: US companies, consumers are paying for tariffs, not foreign firms

#161

Post by [deleted] »

linotype wrote: post #37
xnx wrote: post #28

Crazy that one of the major policy initiatives of the all Republican/Maga government is to impose a huge consumer tax increase. Maybe calling these "import taxes" instead of "tarrifs" would help emphasize that to the average voter?

That’s the point. It’s not crazy. Tariffs are regressive taxes. Rich people buy more stuff, sure, but as a percentage of their income they net out as beneficiaries of shifting taxes from income to spending. It’s totally rational if you want to increase taxes on the bottom 80% to subsidize the top 20% (and especially top 5%).

[deleted]

Re: US companies, consumers are paying for tariffs, not foreign firms

#162

Post by JumpCrisscross »

quantified wrote: post #57
ash_091 wrote: post #46

Earlier quoted context omitted.

How is income tax regressive?

A flat tax would be. It's been flattening in the US.

> A flat tax would be

No. A flat tax is proportional [1].

[1] https://www.investopedia.com/ask/answers/042415/what-are-dif...

Re: US companies, consumers are paying for tariffs, not foreign firms

#163

Post by Yeul »

xnx wrote: post #28

Crazy that one of the major policy initiatives of the all Republican/Maga government is to impose a huge consumer tax increase. Maybe calling these "import taxes" instead of "tarrifs" would help emphasize that to the average voter?

Considering the US deficit a consumer tax is probably a good idea. But ofcourse in their infinite wisdom the Republicans use the money for tax cuts for the rich...

What a country.

Re: US companies, consumers are paying for tariffs, not foreign firms

#164

Post by JumpCrisscross »

klooney wrote: post #116
Newlaptop wrote: post #83

Earlier quoted context omitted.

No one is risking multi-year commitments of millions or billions of dollars to build a factory in America when the tariffs change week to week. If you want to incentive domestic reindustrialization, you do it with things like the Inflation Reduction Act, CHIPS act or the "Green New Deal" where congress lays out clear sets of rules in law with a mixture of tax incentives, loan programs and spending to give investors a…

They change week to week, but they're consistently an order of magnitude above where they were.

> They change week to week, but they're consistently an order of magnitude above where they were

They've about doubled [1], from $55bn to $110bn.

[1] https://www.politico.com/interactives/2025/trump-tariff-inco...

Re: US companies, consumers are paying for tariffs, not foreign firms

#165

Post by JumpCrisscross »

fsckboy wrote: post #98
0cf8612b2e1e wrote: post #78

Earlier quoted context omitted.

Tariff rates have changed how many times in the past six months? Businesses need certainty if they are going to make long term investments.

have you followed the news? it's been reported that after the period of changing tariffs, agreements have been reached for more US manufacturing, said agreements providing the certainty you are seeking.

> agreements have been reached for more US manufacturing

Simple answer is we won't know for another year or two. These [1] are analogous to bookings. They could be bona fide. Or they could be DOGE figures. (We already know the project at the top of the list is being massively scaled back [2].)

Taking a step back, there is currently zero signal in FDI [3][4].

[1] https://www.whitehouse.gov/articles/2025/06/trump-effect-a-r...

[2] https://www.wsj.com/tech/ai/softbank-openai-a3dc57b4?st=7eCi...

[3] https://fred.stlouisfed.org/series/ROWFDIQ027S

[4] https://fred.stlouisfed.org/series/ROWFDNQ027S

Re: US companies, consumers are paying for tariffs, not foreign firms

#166

Post by JumpCrisscross »

swordsmith wrote: post #47

Everyone focusing on consumer prices. But tariffs also function to incentivize domestic reindustrialization, which has huge national security implications. You see this clearly in the venture space as increased investment interest in hardtech and manufacturing. It's great that the federal government is looking long term again.

> tariffs also function to incentivize domestic reindustrialization

The problem is nobody in D.C. has a strategy for tariffs.

Either America is facing unfair international competitive barriers, in which case the tariffs are punitive and to be negotiated away. Or America is erecting permanent trade barriers, in which case there aren't trade negotiations because that would compromise the long-term investment thesis for re-shoring projects.

Re: US companies, consumers are paying for tariffs, not foreign firms

#167

Post by JumpCrisscross »

fsckboy wrote: post #100
supertrope wrote: post #51

Earlier quoted context omitted.

An N95 mask made in China costs $0.30. One made in the USA costs $1.00. A 25% tariff was enacted by executive fiat. The made in China mask is still cheaper than the USA made one. Few hospitals buy American. PPE manufacturers in Malaysia win.

and China is therefore punished in the context of treating US imports to China in an unfair way; this was one of the goals, so you're saying "policy win"?

> China is therefore punished

If we only tariffed China, yes. They would be. Because while their 37.5¢ mask remains 63% cheaper than the American one, it might be 20% more expensive than one made in Mexico or India or Vietnam. But we didn't do that. We raised the prices for everyone. So those orders are, more likely than not, still going to go to China. There will just be some middle men taking a cut along the way.

Re: US companies, consumers are paying for tariffs, not foreign firms

#168

Post by ben_w »

kbelder wrote: post #113
quantified wrote: post #56

Earlier quoted context omitted.

Yup, that's it. The analysis fits. Brexit helped push the UK on the same path.

>Brexit helped push the UK on the same path. The EU has mastered the "global (often faceless) ruling class". No Brexit needed for that one.

The EU's faces are more visible than Westminster's, and their powers much much weaker.

There's a sliding scale from "free trade agreement" to "country", and the EU is closer to the former than the latter even with the Euro and Schengen (neither of which perfectly matches the EU).

Re: US companies, consumers are paying for tariffs, not foreign firms

#169

Post by JumpCrisscross »

fsckboy wrote: post #105
legitster wrote: post #13

A reminder, most tariffs will not be paid because consumers will just shift their spending habits to match or just buy less. Tariffs are a double edged sword because the hurt purchasing power of consumers without really generating much money for the government. The administration is going to focus on the fact that tariffs don't really drive inflation, but are going to miss the forest for the trees: prices won't go up…

> without really generating much money for the government it's been reported that tariff collections have soared to the point that the budgeted spending is no longer in the red. this article is written in a confusing way, but your statement "not generating much money for the govt" appears to be incorrect https://www.cnbc.com/2025/07/11/treasury-posts-unexpected-su...

> tariff collections have soared to the point that the budgeted spending is no longer in the red

"The federal government ran a monthly surplus of $26 billion in June. However, this was because government payments typically due June 1 shifted into May this year as June 1 fell on a weekend. Accounting for this timing shift, the government ran a monthly deficit of $71 billion" [1].

Tariffs have brought in like $55bn in extra revenue to date [2]. One would expect that to decrease as trade deals are negotiated and consumers shift behaviour.

[1] https://bipartisanpolicy.org/report/deficit-tracker/

[2] https://www.politico.com/interactives/2025/trump-tariff-inco...

Re: US companies, consumers are paying for tariffs, not foreign firms

#170

Post by JumpCrisscross »

kazinator wrote: post #10

This only needs to be explained to Americans who are somehow still hanging on to Donald Trump's explanation of tariffs: that they are gonna make foreigners pay. Tariffs are taxes that locals pay on stuff imported from abroad.

> Tariffs are taxes that locals pay on stuff imported from abroad

Importers pay the tariff. But where the tax burden falls is more complicated.

Short answer is that right now, we don't have strong evidence for where the burden is falling. Given how volatile tariffs have been, and the variety of leverage positions of American importers across industries, it will probably be years before we can suss out a signal from the data.

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