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US Administration announces 34% tariffs on China, 20% on EU

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Re: US Administration announces 34% tariffs on China, 20% on EU

#761

Post by myrmidon »

lumb63 wrote: post #625

Everyone is quick to deride this move as stupid. I don’t disagree that there are downsides to the approach, but there is a set of very real national problems that this might address. For instance, globalization and offshoring of production has made goods cheaper for consumers, but what about the former domestic producers who could not compete, and do not have the skills or capital to find a new job which pays as well…

Do you honestly believe that there are significant numbers of US citizens lining up to take up low-margin manufacturing work as is currently done in China or elsewhere?

Chinese manufacturing workers live on a $25k/y income ($15k without adjusting for purchasing parity!). Do you beliefe that raising prices on goods by 30%ish is enough to make those jobs attractive to US citizens?

What sectors would you suggest primarily sourcing domestic manufacturing workers from, and would you agree that just doing that is going to lead to further cost increase for the average consumer?

In my view, the current tariff approach is a rather naive attempt at improving national self-sufficiency at the cost of the average citizen, and the administrations explicit statements and goals make this pretty clear-- shifting government income from taxes to tariffs is a very obvious losing move for the vast majority of people that spend most of their income.

US economy right now is heavily biased towards providing services and high-tech goods because that is the most valuable use of its citizens according to market dynamics. Managing the economy in a "I know better than the market way" certainly did not work out for the soviets...

Sometimes I feel that people construct elaborate theories of how Trumps policies will end up beneficial for the average citizen, despite clear, explicit descriptions of how that is not the goal and historical precedent of acting directly against working-class interests (i.e. raising estate tax exemptions above literal 1%er-thresholds).

Re: US Administration announces 34% tariffs on China, 20% on EU

#762

Post by smallmancontrov »

ajross wrote: post #753
svara wrote: post #750

It's true that free trade is hugely beneficial to the US economy as a whole, particularly with the USD being the reserve currency. The flow of goods is balanced by a flow of US dollars to other countries, which are ultimately cycled back into the US financial system - enabling budget deficits and an abundance of capital to invest in high growth industries. The flip side of this is that it also drives inequality - the…

You're arguing from a steady state. In point of fact the pain of the at-this-point-seemingly-inevitable recession is absolutely going to be concentrated on the working class. Those of us with savings and work flexibility will do just fine. Even someone making a first principles argument for a revision of US trade policy should agree that this is insane.

The real pain will hit the working class harder, but the nominal pain will hit the capital class harder. Historically, this is how inequality unwinds. See: recessions, World War II. Let's hope to god that this is "just" a recession and doesn't cook into World War III.

Re: US Administration announces 34% tariffs on China, 20% on EU

#763

Post by pyrale »

TaurenHunter wrote: post #599

I don't see anyone mentioning that the United States needs to manage its massive national debt, currently in the trillions, by issuing Treasury securities. These securities mature at varying intervals and require continuous "rolling" or refinancing to pay off old debt with new borrowing. Significant rollovers are expected from April through September 2025, with additional short-term maturities due by June. Higher int…

> Increased demand for Treasuries pushes their prices up and yields down, effectively lowering interest rates.

> What are the flaws in this thinking?

Not sure why international investors would want to buy more t-bonds when the country issuing them is starting a trade war and their money could effectively be locked abroad.

Re: US Administration announces 34% tariffs on China, 20% on EU

#764

Post by andreygrehov »

roxolotl wrote: post #479

Aside from everything else one thing what strikes me as particularly insane is how it’s not even defensible as a protective measure. My favorite everyday olive oil comes from Tunisia. They now have a 38% tariff on them. There are no out of work olive farmers in the US. The orange man wanted tariffs, the orange man is going to get tariffs. Now we have to hope the American people aren’t so dumb as to still be convinced…

US does produce olive oil, particularly in states like California, Arizona, Texas, Georgia, Florida, Oregon, and Hawaii. So you do have a few options:

  1. Support local producers. There are high-quality olive oils made right here in the US that might surprise you.
  2. Work with Tunisia manufacturers to move their production to the US
  3. If you don't want to support local producers, pay extra and enjoy your Tunisia olive oil as much as you want
  4. If politics is the real issue for you, move to Tunisia, there is no "orange man" there
That said, refusing to support local production out of principle isn’t really a solution.

Re: US Administration announces 34% tariffs on China, 20% on EU

#765

Post by piokoch »

svara wrote: post #750

It's true that free trade is hugely beneficial to the US economy as a whole, particularly with the USD being the reserve currency. The flow of goods is balanced by a flow of US dollars to other countries, which are ultimately cycled back into the US financial system - enabling budget deficits and an abundance of capital to invest in high growth industries. The flip side of this is that it also drives inequality - the…

Nope. It's true that free trade WAS hugely beneficial to the US economy as a whole. Now free trade is hurting USA economy and that's why USA play against the rules they were promoting for so long.

Re: US Administration announces 34% tariffs on China, 20% on EU

#767

Post by siliconc0w »

The idea that a giant regressive tax, which these are, will help the lower or middle class or do anything but kill demand and destroy jobs is madness.

It also won't help the debt because even though we might collect some money in the short term, the long term solution is we need to grow our way out and these policies are recessionary.

Re: US Administration announces 34% tariffs on China, 20% on EU

#768

Post by [deleted] »

ASinclair wrote: post #711
lumb63 wrote: post #625

Everyone is quick to deride this move as stupid. I don’t disagree that there are downsides to the approach, but there is a set of very real national problems that this might address. For instance, globalization and offshoring of production has made goods cheaper for consumers, but what about the former domestic producers who could not compete, and do not have the skills or capital to find a new job which pays as well…

If you believe in these tariffs then the major problem is how he enacted them. Businesses want certainty. It takes years to build factories. The next president could just wipe away these tariffs instantly. Hell, even the current one could. That does not give these companies the certainty they need to commit years of effort to building factories. If the goal is to spur domestic manufacturing then, at a minimum, he wou…

[deleted]

Re: US Administration announces 34% tariffs on China, 20% on EU

#769

Post by kolanos »

Cyph0n wrote: post #645
roxolotl wrote: post #479

Aside from everything else one thing what strikes me as particularly insane is how it’s not even defensible as a protective measure. My favorite everyday olive oil comes from Tunisia. They now have a 38% tariff on them. There are no out of work olive farmers in the US. The orange man wanted tariffs, the orange man is going to get tariffs. Now we have to hope the American people aren’t so dumb as to still be convinced…

Tunisian here. Tunisians on social media are baffled/amused because olive oil is basically the only product imported by the US.

What is Tunisia buying from the United States?

Re: US Administration announces 34% tariffs on China, 20% on EU

#770

Post by sroussey »

TomK32 wrote: post #650
TaurenHunter wrote: post #599

I don't see anyone mentioning that the United States needs to manage its massive national debt, currently in the trillions, by issuing Treasury securities. These securities mature at varying intervals and require continuous "rolling" or refinancing to pay off old debt with new borrowing. Significant rollovers are expected from April through September 2025, with additional short-term maturities due by June. Higher int…

How about a higher income tax or 1% wealth tax?

Wealth tax is a nice idea but non-starter in implementation.

It works in real estate (property taxes are wealth taxes) because the land can’t move.

One way to tax the super rich is to tax loans against assets. They don’t sell assets to buy a yacht, but borrow against them to avoid paying taxes and keep future gains. Tax those loans as if they sold assets.

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