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US businesses and consumers pay 90% of tariff costs, New York Fed says

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Re: US businesses and consumers pay 90% of tariff costs, New York Fed says

#81

Post by jleyank »

kspacewalk2 wrote: post #66
ranger_danger wrote: post #52

Earlier quoted context omitted.

I think the misunderstanding is in a combination of wording + practical application. Tariffs in the legal sense are technically paid by the importer who sells a product. It's their responsibility to pay it... always. The importer could technically eat that cost, and the consumer wouldn't see a difference on their price tag. But what happens in practice, the vast majority of the time, is the importer passes that extra…

Tariffs can be paid by the seller/exporter. If a very significant part of a company's business is done in the US, and the tariff is sufficiently high, they will lose market share if the customer eats the entire cost of the tariff (which is the whole point of the exercise in the first place). So they may decide to socialize this cost a little bit, by increasing prices in all countries, by a lot less than the tariff, a…

Without coercion today, why would anybody try to give the US a break at the cost of its other trading partners...?

Re: US businesses and consumers pay 90% of tariff costs, New York Fed says

#82

Post by nielsbot »

xnx wrote: post #22

Tariffs are import taxes. The pre-Maga republican party used to be against taxes.

There's no hypocrisy because deep down they never had any principles. Principles they did profess were just marketing. (This applies to Dems as well, while we're at it.)

Re: US businesses and consumers pay 90% of tariff costs, New York Fed says

#83

Post by ericmay »

josefritzishere wrote: post #11

There is only a debate on this topic because propaganda works. It's a regressive tax, which disproportionately hits consumers.

Whether a policy decision creates effects that "harm" consumers isn't the only facet of international trade policy that has to be considered. In fact, it may be one of the least important depending on what exactly that harm is.

Re: US businesses and consumers pay 90% of tariff costs, New York Fed says

#84

Post by engineer_22 »

SunshineTheCat wrote: post #13

Everyone has been getting sold that these tariffs are on "China" or fill-in-the-blank on what country we're "getting" with them. The reality is that's a fundamental misunderstanding of what a tariff is. There is a reason you will find tariffs drop off after the great depression. They make everything more expensive for businesses and in turn, the end consumer. https://en.wikipedia.org/wiki/History_of_tariffs_in_the_Un…

> There is a reason you will find tariffs drop off after the great depression.

The reason is, the whole world's manufacturing base had been destroyed in the War and the USA was the only man left standing!

We didnt need tarriffs because we were already winning the trade balance. Tarriffs made it harder to repatriate overseas gains.

https://www.stlouisfed.org/on-the-economy/2019/may/historica...

Re: US businesses and consumers pay 90% of tariff costs, New York Fed says

#85

Post by stevenjgarner »

CamperBob2 wrote: post #55
stevenjgarner wrote: post #49

Earlier quoted context omitted.

Most people here in the US that I talk to understand that the additional tariffs imposed by the Trump administration are an attempt to get domestic US industries to produce the items that are now being imported subject to the tariff. In some cases that has been successful. In many cases not. Many industries are virtually impossible to de-globalize.

No, the tariffs are just a grift designed to force CEOs to pay tribute to Trump. If the tariffs were "an attempt to get domestic US industries to produce items now being imported," they wouldn't be levied on manufacturing inputs .

I agree the administration tariffs "wouldn't be levied on manufacturing inputs" if they really wanted to help domestic industries. I'm not saying they're doing the right thing, I'm just saying that most Americans I talk to understand the INTENTION is ancient protectionist logic, but the Fed report is evidence that this logic is currently failing to produce the administration's intended "manufacturing miracle". It is so inconsistent, being successful in very specific niches (like some domestic textile or furniture segments), but the Fed notes that nearly half of all businesses reported a decrease in their bottom lines due to the policy.

Re: US businesses and consumers pay 90% of tariff costs, New York Fed says

#86

Post by jleyank »

stevenjgarner wrote: post #49
testing22321 wrote: post #24

Earlier quoted context omitted.

I can’t help wondering if the biggest problem in the US right now is that a majority of people having a “fundamental misunderstanding” about many, many very important things. Maybe it’s because of propaganda, mis information, social media, education or because they’re too busy and tired trying to make ends meet so they don’t have time to research issues for themselves. It feels like it will be very difficult to cours…

Most people here in the US that I talk to understand that the additional tariffs imposed by the Trump administration are an attempt to get domestic US industries to produce the items that are now being imported subject to the tariff. In some cases that has been successful. In many cases not. Many industries are virtually impossible to de-globalize.

The end result is still higher prices for the end-consumer... If the local businesses were unable to compete with a foreign supplier w/o the tariff, they'll be unable to do it with the tariff. So the consumer will end up paying less than (foreign + tariff) but higher than (foreign).

Re: US businesses and consumers pay 90% of tariff costs, New York Fed says

#87

Post by gdilla »

hackyhacky wrote: post #79
SunshineTheCat wrote: post #13

Everyone has been getting sold that these tariffs are on "China" or fill-in-the-blank on what country we're "getting" with them. The reality is that's a fundamental misunderstanding of what a tariff is. There is a reason you will find tariffs drop off after the great depression. They make everything more expensive for businesses and in turn, the end consumer. https://en.wikipedia.org/wiki/History_of_tariffs_in_the_Un…

> Everyone has been getting sold that these tariffs are on "China" Everyone? No, only the willfully ignorant.

well it's a cult, after all.

Re: US businesses and consumers pay 90% of tariff costs, New York Fed says

#88

Post by mindslight »

culi wrote: post #69
SunshineTheCat wrote: post #13

Everyone has been getting sold that these tariffs are on "China" or fill-in-the-blank on what country we're "getting" with them. The reality is that's a fundamental misunderstanding of what a tariff is. There is a reason you will find tariffs drop off after the great depression. They make everything more expensive for businesses and in turn, the end consumer. https://en.wikipedia.org/wiki/History_of_tariffs_in_the_Un…

The fighting part isn't just us tariffing China, it's bullying other countries to do the same. That's how the US won the first trade war under trump 1 (and continued by Biden). Now Trump 2 tried to ramp it up and this time its backfired because other countries have refused to go along. Many have even been pushed to collaborate more closely with China. China's exports have only grown to record highs

> other countries have refused to go along

Trump failed to convince other countries to continue going along because he's a simplistic zero-sum bully who barks orders, expects others to fall in line, and then throws a tantrum when they don't - rather than a tactful leader capable of maintaining the trust of a voluntary positive-sum coalition. That he's also been overtly attacking allies at the same time doesn't help convince anyone either - the new regime was attacking Canada straight out of the gate, and it's hard to explain attacking Greenland any other way than a Putin-favored plan to drive a wedge between us and our traditional allies.

Re: US businesses and consumers pay 90% of tariff costs, New York Fed says

#89

Post by jihadjihad »

There are just so many misconceptions about how taxes, finance, economics, etc. works that it can be exhausting. And it's worse when people in positions of power make no effort, or even make an effort in the opposite direction, to educate people on how things work in reality.

It might shock you to ask around your social circle and discover how many people would read a hypothetical headline like, "Tax Rate for Top Income Bracket Increases to 55%", and interpret it as, "Wow, so if my income was as high as that, more than half of what I made would go to the government. Crazy!"

Re: US businesses and consumers pay 90% of tariff costs, New York Fed says

#90

Post by jleyank »

yoyohello13 wrote: post #33
sejje wrote: post #28

Earlier quoted context omitted.

Similarly, the people loudly protesting tariffs are traditionally for higher taxes.

Those people are generally for higher taxes on the rich. Tariff are a flat tax that dis-proportionally affects the poor.

Which is why the current administration and their (very rich) backers prefer tariffs to income taxes...
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