And here I thought brexit would keep the top spot as act of self harm
Everything is bigger in America.
US Administration announces 34% tariffs on China, 20% on EU
801–810 of 1001 posts
Re: US Administration announces 34% tariffs on China, 20% on EU
#802I am not a specialist; but isn't that the most "green" policy ever ? I mean: - Tariffs will increase the price of virtually everything -> By law of supply and demand; global trade and production will decrease, leading to less CO2 production - This effect will be stronger for stuff coming from far away (little for Canda / Mexico; more for EU; huge for China). So companies will have a tendency to rely on local producer…
Yes.
If you're into green policies, then tariffs are aligned with what you'd probably want, at least on some level. Though it's more complicated and by no means a slam dunk. One could say that producing things locally in more places is less efficient (lower economies of scale, etc.) which might result in more overhead per item, which might outweigh the extra transportation, etc. General assumption is that an unconstrained free market arrangement encourages system optimizing itself. But then there's a question what is it optimizing itself for, and that's definitely not ecological impact.
A change like that in a global economy has tons of non-linear effects, many of which it need to play over time, etc. Some changes are more easy to predict confidently, many not so much. But barely anyone argues from first principles, and its typically just tribal screeching on both sides.
Re: US Administration announces 34% tariffs on China, 20% on EU
#803Everyone 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…
There are two different questions here: (1) is Trump's strategy a good one to accomplish his goals? and (2) what are other good ideas to do so? Just because there aren't many ideas in bucket #2 doesn't mean you should do #1. For a trivial example, consider steel and aluminum tariffs (Larry Summers gave this example on Bloomberg yesterday): There are 60x more jobs in industries that rely on steel/aluminum inputs than…
Look at it from Trump's perspective for a moment. The only tool he has is tariffs, and the people he's negotiating with are not just foreign governments but also Congress. Because he has this authority he can use it to try to bring any of those to the table and negotiate alternative approaches. Not saying that's what he's doing. Just saying that's a possibility.
Re: US Administration announces 34% tariffs on China, 20% on EU
#804It'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…
Yes! I've been consistently frustrated at both sides of the issue. It became salient for me when I read about how China had sanctioned three American drone manufacturers that were supplying Ukraine last year, and how it disrupted their supply chains and ultimately the war effort.
It is unacceptable for any other country to be able to do this to any part of the western-aligned military supply chain.
We needed a targeted policy -- I don't care about American cars except to the extent that those factories can be converted to aircraft and tank factories.
But the conversation has been frustratingly reduced to 'reshore low skill work' vs 'save my infinite trough of cheap plastic slop'.
I don't want to hear about tariffs bad, I want to hear about how subsidies are better or about how it doesn't matter anyway because of the structure of the Chinese economy (I saw it claimed without evidence that they depend on imports from places aligned with the west which is reassuring if substantiated).
There's an underlying issue everyone is dancing around.
Re: US Administration announces 34% tariffs on China, 20% on EU
#805Aside 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…
According to Trump Tunisia has to buy olive oil from you for the same amount of money that you spent on Tunisias olive oil. Otherwise one side has a trade deficit and that's unfair!
Re: US Administration announces 34% tariffs on China, 20% on EU
#806It'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…
The deficit is 2 trillion.
Income taxes on individuals are 2.4 trillion.
How much do you expect to raise taxes to cover that gap? You double my taxes and I’m in the welfare line.
Further, and this is not referenced enough - the US must rollover ~9 trillion in treasuries this year. The lower the interest rate to do that, the better. Otherwise it increase the deficit even more.
The only way this ends is one of two paths - a path similar to what we are on; default.
We may not like this one, but default is world destroying because of the broad use of the Dollar around the globe.
Re: US Administration announces 34% tariffs on China, 20% on EU
#807One thing I don't understand. US is much bigger than most countries. Why would a country the size of Belgium (~12M people) needs to import as much as it export from the US in order not to have tariffs > 10%?
You could flip this around. Why would a country the size of Belgium need to export as much as it imports from the US?
Re: US Administration announces 34% tariffs on China, 20% on EU
#808"This guy cracked the tariff formula: @orthonormalist It’s simply the nation’s trade deficit with us divided by the nation’s exports to us. Yes. Really. Vietnam: Exports 136.6, Imports 13.1 Deficit = 123.5 123.5/136.6 = 90%" https://x.com/Geiger_Capital/status/1907568233239949431
Can anyone else confirm this is true? I’m feeling a bit sceptical here.
Confirmed by the White House here: https://ustr.gov/issue-areas/reciprocal-tariff-calculations.
Re: US Administration announces 34% tariffs on China, 20% on EU
#809I 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…
The trade deficit is balanced by USD flows, which are ultimately reinvested with leverage into American capital markets. In many ways the US trade deficit combined with the USD reserve currency status is thus what enables the high budget deficit in the first place.
this SHOULD be really obvious to those in charge, but I think is too subtle for them, or they're willfully ignoring it for the "trade deficit" narrative. I don't see how the end result is not a decline in the global role of the US and a whole bunch of pain for everybody as this all unwinds. All for the hubris of an old man...
Re: US Administration announces 34% tariffs on China, 20% on EU
#810for starters, countries will sell to the UK , which will resell to the US at the lowest tarriff rate. Great for the UK, but stupid. I try to sympathize with trump's deglobalization agenda but it is probably exactly what it seems to be : a colossal stupidity.
In that example, the UK would soon run a trade surplus, and presumably the US would increase their tariff.