Showing posts with label trade. Show all posts
Showing posts with label trade. Show all posts
May 11, 2025
May 6, 2025
Brace For Impact
There's this thing they teach in Econ 101 (and any given Marketing Seminar) called elasticity.
Trump's tariffs are in effect, and the last un-tariffed cargo ship we're expecting from China sailed a week or two ago.
It takes 2 or 3 or 4 or 5 weeks for the goods to sail o'er the bounding main, and then another week or more to get the stuff from the ports to the local Walmart.
So we can expect interruptions and delays and shortages and higher prices beginning in a month or so.
But one other thing about elasticity: even if Trump manages to get his head out of his ass long enough to think up some bullshit story about how he won The Great Patriotic Trade War, shit doesn't just suddenly get put right, and we're back to normal overnight.
First, other countries in the world - some we call "friend" - have been itchin' for a chance to fuck us over for a very long time. New trade deals that exclude the US are being worked out right now, and there's more than a fair probability that the rest of the world takes this opportunity to hedge their bets and not "get back to normal" - not when the US can so easily become unreliable.
Second, Capitalism leans pretty heavily on the notion of "scarcity" to keep their prices high in order to maximize shareholder value. There's a whole big bunch of companies creaming their jeans over the prospect of milking this problem for every nickel they can squeeze out of it, and plenty of them will never go "back to normal" because they're learning that lots of us will just sit here and take it. So don't expect prices to go back down once this shit is over - because they're going to find a way to keep us hangin' for as long as they can.
May 4, 2025
That About Covers It
Americans didn’t vote for less stuff that costs more
Trump is wrong to say he has buy-in for transforming the world’s biggest economy.
President Donald Trump seems to be in denial about the unpopularity of his trade wars. On what he intended as a victory lap to coincide with the 100th day of his second term, he repeatedly attacked pollsters as “crooked people” who put out “fake polls.”
At a rally in Michigan on Tuesday, Trump claimed his approval rating was “in the 60s or 70s.” A Washington Post-ABC News-Ipsos poll puts it at 39 percent. This is the same share of American adults as approve of his handling of the economy. And nearly two-thirds, 64 percent, oppose Trump’s tariffs on imported goods.
These numbers are consistent across several recent public surveys. This led to one of the more awkward moments of the past week. During a live interview Tuesday, Fox News correspondent John Roberts asked Stephen Miller, a White House deputy chief of staff, about his network’s polling. “Particularly on the economy, tariffs and inflation, he’s well underwater,” Roberts said of Trump. To which Miller responded: “It is our opinion that Fox News needs to fire its pollster. … We don’t acknowledge any of that polling.”
In another interview Tuesday, Terry Moran of ABC News asked Trump about economists warning that his trade war with China will cost the typical American family thousands of dollars a year. The correspondent said many who voted for Trump fear the fallout. Trump replied: “Well, they did sign up for it, actually. And this is what I campaigned on.” Then he insisted that China will “eat those tariffs” rather than raise prices. This is unimaginable.
During a Cabinet meeting Wednesday, Trump seemed a little more willing to acknowledge that a protracted trade fight with China will force consumers to adjust their behavior. “Maybe the children will have two dolls instead of 30 dolls,” he said. “And maybe the two dolls will cost a couple bucks more than they would normally.”
This sounded like Trump’s “malaise” moment. In 1979, President Jimmy Carter delivered a notorious address from the Oval Office that was similarly motivated by a lamentation of U.S. dependence on foreign imports. In Carter’s case, though, the import was oil. “We can’t go on consuming 40 percent more energy than we produce,” he said. Americans didn’t want to wear cardigans or lower their thermostats. Outside wartime, calling for austerity has rarely been a winning political message.
Trump’s assumption, for decades, has been that Americans can have it all. During the rally Tuesday, he promised to make the country wealthy again. Yet here he was acknowledging to his Cabinet that Americans might need to pay more money for less stuff.
The president is right to say that he campaigned on imposing tariffs. At his rallies, he extolled the beauty of the T-word. Yet many of his voters did not think they were voting to end the era of consumerism. This has become a refrain from his administration. As Treasury Secretary Scott Bessent said in March, “Access to cheap goods is not the essence of the American Dream.”
Yes, Americans still want to put inexpensive Barbies, G.I. Joes and Disney dolls under their Christmas trees. But the United States depends on Chinese imports for far more than cheap toys.
Even a slight majority of Republicans, 51 percent, say they think Trump’s economic policies will cause an economic recession in the short term, even as they overwhelmingly continue to support him, according to the Post-ABC-Ipsos poll. Asked whether Trump’s policies will put the U.S. economy on a stronger foundation in the long run, only 31 percent of Americans said yes; 42 percent said they will leave us weaker, and 22 percent said it’s too soon to say.
Trump said Friday on social media that the economy is going through a “transition stage.” He’s blaming his predecessor and urging patience. So far, the U.S. economy has proved quite resilient, even as businesses pause investment decisions while they wait for some certainty about what’s ahead. Though the labor market cooled last month, the government said Friday that employers still added 177,000 jobs. And though the U.S. economy shrank for the first time in three years during the first quarter, annualized gross domestic product contracted by just 0.3 percent.
A central challenge for Trump’s project is that he still has not secured buy-in to fundamentally transform the world’s biggest economy, let alone to decouple from China, the world’s second-largest economy. A resolution disapproving Trump’s “Liberation Day” tariffs failed in the Senate on Wednesday with only 49 votes but would have passed had two senators not been absent. Sen. Rand Paul (R-Kentucky), who deserves credit for defending Congress’s constitutional prerogative, said afterward that many GOP senators privately dislike the tariffs and will start speaking out if the economy continues to weaken. They hope Trump cleans up the mess first.
With luck, this might still be possible. China signaled a new willingness Friday to start talks with the United States. Container ships that carry goods from China take about a month to cross the Pacific. Trump can get them moving again if both sides come to the table.
May 1, 2025
Apr 30, 2025
Apr 25, 2025
Return To Sender
And they're canceling orders for maybe another 50.
China sends Boeing planes back to US over tariffs
China has sent back planes it ordered from the US in its latest retaliation over Trump tariffs, the boss of aircraft maker Boeing has said.
Kelly Ortberg said two planes had already been returned and another would follow after trade tensions between the two countries escalated.
Boeing's chief executive told CNBC that 50 more planes were due to go to China this year but their customers had indicated they will not take delivery of them.
The US put 145% tariffs on imports from China and it hit back with a 125% tax on US products.
Speaking in the Oval Office on Tuesday, Trump said he was optimistic about improving trade relations with China, saying the level of tariffs he had imposed would "come down substantially, but it won't be zero".
However, Mr Ortberg said China "have in fact stopped taking delivery of aircraft because of tariff environment".
Boeing is America's largest exporter with about 70% of its commercial aircraft sales outside of the US.
Mr Ortberg said Boeing was assessing options to re-market 41 of the already built planes to other customers as there was high demand from other airlines.
He said there were nine planes not yet in Boeing's production system and he wanted to "understand their intentions and if necessary we can assign to other customers".
He added Boeing was "not going continue to build aircraft for customers who will not take them".
Boeing in daily talks with Trump's team
Later in the afternoon, Mr Ortberg told an investor call "there is not a day that goes by that we're not engaged with either cabinet secretaries or either POTUS himself (President Trump) regarding the trade war between China and the USA."
He added he was "very hopeful we'll get to some negotiations".
On Wednesday, America's Treasury Secretary Scott Bessent told the International Monetary Fund (IMF) conference there was an opportunity for a "big deal" between the US and China on trade.
Asked about an upcoming meeting between the countries, Bessent said it would be an "incredible opportunity" to strike an agreement, if China was "serious" on making its economy less dependent on manufacturing exports.
Mr Ortberg also told investors others in the Boeing supply chain were now exposed to tariffs - mainly in Japan and Italy where universal tariffs of 10% are being implemented.
Brian West, Boeing's chief financial officer said during the call "free trade policy is very important to us" and Boeing will continue to work to with suppliers to ensure continuity.
Boeing has reported smaller losses for the first quarter of the year after it manufactured and delivered more planes.
Production had slumped in 2024 due to a series of crises and a strike by about 30,000 American factory workers.
It wants to increase output of its 737 MAX jets to 38 a month in 2025.
At $55M per airplane, that's $2.5B in lost revenue - money that was all but in the fucking bag.
This is a total unforced error - an own goal - shooting yourself in the foot.
China sends Boeing planes back to US over tariffs
China has sent back planes it ordered from the US in its latest retaliation over Trump tariffs, the boss of aircraft maker Boeing has said.
Kelly Ortberg said two planes had already been returned and another would follow after trade tensions between the two countries escalated.
Boeing's chief executive told CNBC that 50 more planes were due to go to China this year but their customers had indicated they will not take delivery of them.
The US put 145% tariffs on imports from China and it hit back with a 125% tax on US products.
Speaking in the Oval Office on Tuesday, Trump said he was optimistic about improving trade relations with China, saying the level of tariffs he had imposed would "come down substantially, but it won't be zero".
However, Mr Ortberg said China "have in fact stopped taking delivery of aircraft because of tariff environment".
Boeing is America's largest exporter with about 70% of its commercial aircraft sales outside of the US.
Mr Ortberg said Boeing was assessing options to re-market 41 of the already built planes to other customers as there was high demand from other airlines.
He said there were nine planes not yet in Boeing's production system and he wanted to "understand their intentions and if necessary we can assign to other customers".
He added Boeing was "not going continue to build aircraft for customers who will not take them".
Boeing in daily talks with Trump's team
Later in the afternoon, Mr Ortberg told an investor call "there is not a day that goes by that we're not engaged with either cabinet secretaries or either POTUS himself (President Trump) regarding the trade war between China and the USA."
He added he was "very hopeful we'll get to some negotiations".
On Wednesday, America's Treasury Secretary Scott Bessent told the International Monetary Fund (IMF) conference there was an opportunity for a "big deal" between the US and China on trade.
Asked about an upcoming meeting between the countries, Bessent said it would be an "incredible opportunity" to strike an agreement, if China was "serious" on making its economy less dependent on manufacturing exports.
Mr Ortberg also told investors others in the Boeing supply chain were now exposed to tariffs - mainly in Japan and Italy where universal tariffs of 10% are being implemented.
Brian West, Boeing's chief financial officer said during the call "free trade policy is very important to us" and Boeing will continue to work to with suppliers to ensure continuity.
Boeing has reported smaller losses for the first quarter of the year after it manufactured and delivered more planes.
Production had slumped in 2024 due to a series of crises and a strike by about 30,000 American factory workers.
It wants to increase output of its 737 MAX jets to 38 a month in 2025.
Everything Trump touches
turns to shit
Apr 24, 2025
Don't Hold Your Breath
Good deals on international trade don't get done in a hurry. They don't take a few months and half a dozen phone calls. They can take a decade or more.
Apr 4, 2025
It Won't Get Better
Near the end of this piece, Steven Rattner hits the mark by identifying the problems of income & wealth disparity, and the long slide from middle class prosperity into stagnation.
But he fails to fully acknowledge that the causes lie, in large part, with short-sighted corporate policies, and the lopsided advantages handed to big companies and their management teams.
None of this gets better until we burn a few CEOs at the stake.
IF WE TAX THE RICH NOW
WE WON'T HAVE TO EAT THEM LATER
Everything's Awesome
A nice little five-fecta.
"The economic pain that will be brought by these tariffs are hard to describe and can essentially take the US tech industry back a decade," Dan Ives said.
Stock futures tumbled again on Friday after China said it would impose a 34% tariff on US imports, while European markets continued to slide.
Stocks plummeted on Thursday in reaction to a widening global trade war. With few parallels in history, markets are wondering where things go from here.
As president Trump's latest tariffs weigh on growth outlooks, OPEC+ members unveiled plans for an output boost that outpaced expectations.
Is the trade war Trump's strategy to bring down interest rates?
Mar 11, 2025
Mar 9, 2025
The Double Whammy
It can be hard to get with a program of punishment when you've spent a long time trying to train yourself not to rely on force.
But sometimes, with some people, literally all you can do is either give up and hand over your lunch money, or you can take your best shot and kick 'em in the stomach. They're not going to listen to you when they're all hunched over groaning, but even once the pain subsides, the memory of the unpleasantness remains, and then you have a chance to talk sense to them.
And actually, Keith Kellogg (Trump's Special Envoy To Ukraine) gave us a great bit of insight into how these authoritarian brains "work".
A few days ago, Trump announced that we would no longer be supplying intel to Kyiv - the kind of information that the Ukrainians have been using to anticipate Russian attacks - and very shortly after that announcement Russia launched missile attacks against Ukrainian cities that were unable to prepare.
Kellogg articulated thusly, "The best way I can describe it is sort of like hitting a mule with a 2x4 across the nose - you got their attention."
Zelenskyy - a man who's been a good friend to us - didn't kowtow to Trump, so he had to be punished - Ukrainian civilians had to be killed so Trump could make his point.
It sucks, but that's the brand of bullying bullshit we're dealing with. So be it.
I'm not the least bit happy about having to take the hits that are coming, but this is what we've got now. This stupid fuck in the White House - and the asshole plutocrats in charge of our national policy - this is what we have to fight to change.
In the meantime -
Stay with it, Canadians
🇺🇸 ❤️ 🇨🇦
Feb 13, 2025
Jan 31, 2025
About Those Tariffs
- Cars & Parts
- Electrical & Electronics
- Machinery & Boilers
- Dirty fuels
- Pharmaceuticals
- Opticals, Photographic, Medical Equipment
- Furniture & pre-fab buildings
- Beverages & Vinegars
- Fruits, Nuts, & Veggies
- Fats & Oils
- Fertilizers, meats, other farm/farming products
- Plastics
- Iron & Steel
- Precious metals & gems
- Rubber
- Cereal grains & flour
- Paper products
- Aircraft & Spacecraft
- Aluminum
- Lumber & wood products
Add them all up, and you've got almost $732 billion worth of imported goods from just those 2 countries.
Multiply that by .25 (25% tariffs), and that's $183 billion in additional cost to American consumers (not including the "downstream" costs like packaging and packing materials, added costs for housing and transportation, and the rise in prices just in case things get even worse, and let's face it, this Donald fucking Trump we're talking about here - things will get worse).
Divide that $183 billion by 127 million households, and we all get to pay $1440 more than what we're paying now, plus whatever extra we'll have to pay for everything because of the inflation caused by something as fucking stupid as Trump's tariffs.
Wanna talk about the stuff we import from China?
Oct 26, 2024
PSA - Tariffs
Dear MAGA,
What tariffs do and why economists don't like them
Trump keeps expanding his tariff plans, but most trade analysts across the political spectrum warn they’d inflate consumer prices.
“The most beautiful word in the dictionary is tariff,” former President Donald Trump told the Economic Club of Chicago last week. “It’s my favorite word.”
The Republican candidate for president has spent the past few weeks floating ever higher proposals for raising surcharges on foreign goods entering the United States. He has called for a 20% blanket tariff on all imports, tariffs of at least 60% on products from China, 100% tariffs on nations that shift away from trading with the dollar, and a 2,000% tariff on vehicles built in Mexico.
Economists across the political spectrum oppose these ideas, saying the most likely outcome would be higher prices for consumers. Here’s a look at how tariffs work and why they’re so critical in an election in which living costs are front and center.
What tariffs do and who pays them
Tariffs, also known as duties or levies, are deterrents. They penalize domestic firms that import foreign-made goods to encourage companies to source more of those items within the country. When a tariff is placed on a product — be it a watermelon, a washing machine or a high-tech component — any U.S.-based company that imports it must pay a percentage of that item’s price to the government, with federal officials setting the rate.
Trump has said the revenue from these payments would be huge. He proposes using it to fund everything from tax cuts to subsidized child care. In a rambling response to a question about the latter issue last month, he said “those numbers” from tariff revenue “are so much bigger than any numbers that we’re talking about, including child care” costs.
But any business facing a tariff has two options: either stop importing the targeted product and buy it domestically instead, or raise its sale price. When firms can’t find the goods they need within U.S. borders at prices they can afford, or at all, they tend to pass some or all of the cost of the tariff to consumers.
For that reason, Vice President Kamala Harris has called Trump’s tariff proposals “a sales tax on the American people” that she says would raise costs for households by $4,000 each year. Adam Hersh, a senior economist at EPI Action, the advocacy arm of the left-leaning Economic Policy Institute, puts that estimate lower but still in the four-figure range at $2,500 to 3,000 per year.
“Donald Trump will not just impose a $4,000 a year middle class tax hike — his plan will permanently jack up inflation, crush American manufacturing jobs, and hurt manufacturing workers more than any other sector,” Joseph Costello, a Harris campaign spokesperson, said in a statement. “Over and over, independent economists are warning of the economic dangers of Trump’s plan, and Americans should take note.”
The Trump campaign didn’t respond to a request for comment.
Whatever the ultimate cost, many economists agree that higher, more widespread tariffs would drive up prices for consumers.
“She’s right that his tariffs are like a sales tax, in the sense that consumers everywhere are going to end up paying,” Alan Deardorff, an economist at the University of Michigan who specializes in international trade, said of Harris’ claim. But he cautioned that only fully imported products would likely increase by the same rate as the tariff itself; the costs of goods assembled in the U.S. from a mix of imported and domestic parts, such as cars and airplanes, would likely rise by less.
While tariffs are broadly disliked by economists, they now draw more bipartisan support than they have in decades. There’s agreement in both parties that endlessly lowering barriers to global trade has had detrimental economic and social consequences.
Some farmers and factory owners complained during the Trump administration that its tariffs were hurting their bottom lines, leading the White House to funnel tens of billions of dollars in subsidies to agricultural producers. But the Biden-Harris administration largely hasn’t reversed course. It extended about $300 billion in its predecessor’s duties on Chinese goods, and even added additional tariffs on $18 million worth of Chinese goods in strategic industries, including electric vehicles, semiconductors, steel and aluminum.
The impact on prices and jobs
Trump and his allies who endorse his trade policies argue that tariffs protect and bolster domestic markets, spurring homegrown producers to expand. They also see them as an economic weapon. Trump recently threatened the Illinois-based tractor maker John Deere with a 200% tariff if it moves production to Mexico.
Some economists had long theorized that if the U.S. imposed tariffs on a product, foreign producers would lower their prices to avoid being pushed out of the large, lucrative American market. Tariffs had been falling around the world for decades before the Trump administration rolled out its 2018 levies, which created a natural experiment to test that thesis.
In the years since, Deardorff said, “you can’t find anything in the data indicating that the foreign prices went down.”
Even if tariffs do force some overseas producers to lower prices, U.S. consumers wouldn’t necessarily reap the benefits, said Monica Morlacco, an economics professor at the University of Southern California. At best, the price would simply decrease by less than the amount of the tariff.
“Consumer prices will always go up by any reasonable analysis of tariffs,” she said.
In fact, some of Trump’s earlier tariffs led domestic producers to hike their prices. In 2018, Trump slapped tariffs ranging from 20% to 50% on many residential washing machines from South Korea, leading Seoul-based LG to raise its prices in response. But so did the brand’s American competitors, as the newly pricier foreign models juiced demand for U.S.-made products.
Reviewing the price data, University of Chicago researchers later found “no clear distinction between domestic and foreign brands in these results, all within a range of 5 and 17 percent” — and dryers, which weren’t subject to tariffs but are often purchased alongside washers, saw price hikes as well.
A paper the following year from the New York Federal Reserve found Trump’s tariffs and other protectionist trade policies cost U.S. consumers $1.4 billion each month. “Tariffs were almost completely passed through into U.S. domestic prices, so that the entire incidence of the tariffs fell on domestic consumers,” the authors wrote.
Prices aside, “people believe that the tariffs will protect domestic jobs, and they like this idea that we can help our American workers,” said Robert Lawrence, a professor of international trade and investment and a senior fellow at the Peterson Institute for International Economics. “I think they’re mistaken.”
That’s partly because of how tariffs reverberate through global trade, he said: “We’re going to be buying less from foreigners because their goods are more expensive. We’re going to therefore have this adverse effect on our inputs, and therefore we’re also going to be able to sell less abroad.”
Voters, however, have mixed opinions on tariffs. An NBC News poll this month found little more than a third of voters were in favor of universal tariffs, with most others opposed or indifferent, but a Reuters/Ipsos poll in mid-September found a narrow majority backing Trump’s tariff plans.
When people think of tariffs, they think of bringing jobs back or opening factories, said Maurice Obstfeld, a senior fellow at the Peterson Institute.
“Those are laudable social goals,” he said. “But what the public understands less about tariffs is that they raise prices to consumers and also to businesses that use protected inputs. They’re not really effective at bringing jobs back on a large scale.”
The nonpartisan Tax Foundation, which typically advocates for lower taxes and other pro-business policies, has estimated that Trump’s latest tariff plans would reduce the U.S. gross domestic product by 0.8% and cost 684,000 jobs. When jobs are created, they often cost more than what the job pays, economists say. In the University of Chicago washing machine study, researchers estimated each job created cost consumers about $815,000 annually.
Still, Obstfeld acknowledged tariffs’ political appeal in many regions that have struggled with the loss of manufacturing jobs. It’s easy for economists to say that noncompetitive industries should go out of business, but “we’re talking about real people with real jobs,” he said.
“This is one of the reasons why protection can be popular,” Obstfeld said. “Because otherwise, a lot of people are hung out to dry.”
Tariffs are paid by the end user - the consumer - you - not by the company that made the product and shipped it over here to you. You pay for it because the people who import the stuff aren't stupid enough to just eat the extra cost.
If you support Trump and his tariff policy, you're volunteering for a tax increase by way of higher prices on everything buy that isn't produced here in USAmerica Inc.
What did you get your kids for Christmas? Where was it made? Vote for Trump, and congratulations - your cost next year will be 20 to 60 to god-knows-what % higher.
And we're not the only country that can impose tariffs.
Last time, Trump's tariffs hit American farmers so hard, we had to bail them out to the tune of $16 billion.
Tariffs aren't universally a bad thing. As long as they're targeted properly (ie: intelligently - which, I think we all know isn't how Trump would do it), they can level the playing field when we're dealing with some asshole country that's dumping steel (for example), intending to drive prices down to the point where the domestic product isn't profitable enough to keep a US company in business.
But you don't simply announce you're raising all the existing tariffs, and putting new tariffs on everything at 50 or 100 or 2000% - which Trump has threatened by the way.
And also too - this whole tariff bandwagon thing smacks of Republican fuckery. I can see them using it as an attempt to kill income tax altogether - which sounds pretty damned appealing - but what it does is shift the entire tax burden to people who actually work for their money.
What's the point in boosting your take-home pay by 30%, if it means the price of everything you buy goes up 35 or 40%?
Trump keeps expanding his tariff plans, but most trade analysts across the political spectrum warn they’d inflate consumer prices.
“The most beautiful word in the dictionary is tariff,” former President Donald Trump told the Economic Club of Chicago last week. “It’s my favorite word.”
The Republican candidate for president has spent the past few weeks floating ever higher proposals for raising surcharges on foreign goods entering the United States. He has called for a 20% blanket tariff on all imports, tariffs of at least 60% on products from China, 100% tariffs on nations that shift away from trading with the dollar, and a 2,000% tariff on vehicles built in Mexico.
Economists across the political spectrum oppose these ideas, saying the most likely outcome would be higher prices for consumers. Here’s a look at how tariffs work and why they’re so critical in an election in which living costs are front and center.
What tariffs do and who pays them
Tariffs, also known as duties or levies, are deterrents. They penalize domestic firms that import foreign-made goods to encourage companies to source more of those items within the country. When a tariff is placed on a product — be it a watermelon, a washing machine or a high-tech component — any U.S.-based company that imports it must pay a percentage of that item’s price to the government, with federal officials setting the rate.
Trump has said the revenue from these payments would be huge. He proposes using it to fund everything from tax cuts to subsidized child care. In a rambling response to a question about the latter issue last month, he said “those numbers” from tariff revenue “are so much bigger than any numbers that we’re talking about, including child care” costs.
But any business facing a tariff has two options: either stop importing the targeted product and buy it domestically instead, or raise its sale price. When firms can’t find the goods they need within U.S. borders at prices they can afford, or at all, they tend to pass some or all of the cost of the tariff to consumers.
For that reason, Vice President Kamala Harris has called Trump’s tariff proposals “a sales tax on the American people” that she says would raise costs for households by $4,000 each year. Adam Hersh, a senior economist at EPI Action, the advocacy arm of the left-leaning Economic Policy Institute, puts that estimate lower but still in the four-figure range at $2,500 to 3,000 per year.
“Donald Trump will not just impose a $4,000 a year middle class tax hike — his plan will permanently jack up inflation, crush American manufacturing jobs, and hurt manufacturing workers more than any other sector,” Joseph Costello, a Harris campaign spokesperson, said in a statement. “Over and over, independent economists are warning of the economic dangers of Trump’s plan, and Americans should take note.”
The Trump campaign didn’t respond to a request for comment.
Whatever the ultimate cost, many economists agree that higher, more widespread tariffs would drive up prices for consumers.
“She’s right that his tariffs are like a sales tax, in the sense that consumers everywhere are going to end up paying,” Alan Deardorff, an economist at the University of Michigan who specializes in international trade, said of Harris’ claim. But he cautioned that only fully imported products would likely increase by the same rate as the tariff itself; the costs of goods assembled in the U.S. from a mix of imported and domestic parts, such as cars and airplanes, would likely rise by less.
While tariffs are broadly disliked by economists, they now draw more bipartisan support than they have in decades. There’s agreement in both parties that endlessly lowering barriers to global trade has had detrimental economic and social consequences.
Some farmers and factory owners complained during the Trump administration that its tariffs were hurting their bottom lines, leading the White House to funnel tens of billions of dollars in subsidies to agricultural producers. But the Biden-Harris administration largely hasn’t reversed course. It extended about $300 billion in its predecessor’s duties on Chinese goods, and even added additional tariffs on $18 million worth of Chinese goods in strategic industries, including electric vehicles, semiconductors, steel and aluminum.
The impact on prices and jobs
Trump and his allies who endorse his trade policies argue that tariffs protect and bolster domestic markets, spurring homegrown producers to expand. They also see them as an economic weapon. Trump recently threatened the Illinois-based tractor maker John Deere with a 200% tariff if it moves production to Mexico.
Some economists had long theorized that if the U.S. imposed tariffs on a product, foreign producers would lower their prices to avoid being pushed out of the large, lucrative American market. Tariffs had been falling around the world for decades before the Trump administration rolled out its 2018 levies, which created a natural experiment to test that thesis.
In the years since, Deardorff said, “you can’t find anything in the data indicating that the foreign prices went down.”
Even if tariffs do force some overseas producers to lower prices, U.S. consumers wouldn’t necessarily reap the benefits, said Monica Morlacco, an economics professor at the University of Southern California. At best, the price would simply decrease by less than the amount of the tariff.
“Consumer prices will always go up by any reasonable analysis of tariffs,” she said.
In fact, some of Trump’s earlier tariffs led domestic producers to hike their prices. In 2018, Trump slapped tariffs ranging from 20% to 50% on many residential washing machines from South Korea, leading Seoul-based LG to raise its prices in response. But so did the brand’s American competitors, as the newly pricier foreign models juiced demand for U.S.-made products.
Reviewing the price data, University of Chicago researchers later found “no clear distinction between domestic and foreign brands in these results, all within a range of 5 and 17 percent” — and dryers, which weren’t subject to tariffs but are often purchased alongside washers, saw price hikes as well.
A paper the following year from the New York Federal Reserve found Trump’s tariffs and other protectionist trade policies cost U.S. consumers $1.4 billion each month. “Tariffs were almost completely passed through into U.S. domestic prices, so that the entire incidence of the tariffs fell on domestic consumers,” the authors wrote.
Prices aside, “people believe that the tariffs will protect domestic jobs, and they like this idea that we can help our American workers,” said Robert Lawrence, a professor of international trade and investment and a senior fellow at the Peterson Institute for International Economics. “I think they’re mistaken.”
That’s partly because of how tariffs reverberate through global trade, he said: “We’re going to be buying less from foreigners because their goods are more expensive. We’re going to therefore have this adverse effect on our inputs, and therefore we’re also going to be able to sell less abroad.”
Voters, however, have mixed opinions on tariffs. An NBC News poll this month found little more than a third of voters were in favor of universal tariffs, with most others opposed or indifferent, but a Reuters/Ipsos poll in mid-September found a narrow majority backing Trump’s tariff plans.
When people think of tariffs, they think of bringing jobs back or opening factories, said Maurice Obstfeld, a senior fellow at the Peterson Institute.
“Those are laudable social goals,” he said. “But what the public understands less about tariffs is that they raise prices to consumers and also to businesses that use protected inputs. They’re not really effective at bringing jobs back on a large scale.”
The nonpartisan Tax Foundation, which typically advocates for lower taxes and other pro-business policies, has estimated that Trump’s latest tariff plans would reduce the U.S. gross domestic product by 0.8% and cost 684,000 jobs. When jobs are created, they often cost more than what the job pays, economists say. In the University of Chicago washing machine study, researchers estimated each job created cost consumers about $815,000 annually.
Still, Obstfeld acknowledged tariffs’ political appeal in many regions that have struggled with the loss of manufacturing jobs. It’s easy for economists to say that noncompetitive industries should go out of business, but “we’re talking about real people with real jobs,” he said.
“This is one of the reasons why protection can be popular,” Obstfeld said. “Because otherwise, a lot of people are hung out to dry.”
Aug 25, 2019
Who's Foolin' Who?
Made in China: 85% of Walmart's goods
Made in China: 70% of Target's goods
Made in China: 100% of Dollar Tree's goods
Made In China: 50% of medications & vaccines
Made in China: 60-70% of Apple products
Made in China: 100% of Trump merchandise
45* says we don't need China and he's fixin' to "win" his trade war by borrowing more money from them - kinda like what he's done his whole worthless fucking life.
He thinks he can just go on borrowing and either threatening to default or defaulting in fact, and eventually he'll be "in control" of his debtors because they won't be able to afford to be mean to him.
But we're talking about the lives of 325,000,000 million Americans, plus however many millions more around the world who're going to be fucked over completely if we don't put a stop to this bullshit.
Jul 27, 2019
Spotted Friendly Foot - Shot Same.
Right now, the only thing the Repubs think they have going for them (they're flacking the shit out of it anyway) is an economy that they portray as being the best ever and the reason you should all run out and vote for rich white people to get richer and even more purebred-white-bread.
So what does 45* do?
BBC News:
US President Donald Trump has accused French President Emmanuel Macron of "foolishness" over a digital services tax, and hinted that he would tax French wine in retaliation.
So what does 45* do?
BBC News:
Mr Trump voiced his anger in a Tweet on Friday, in response to French plans to tax multinational firms like Google.
French authorities argue that the firms pay little or no corporate tax in countries where they are not based.
The Trump administration has said the tax unfairly targets US tech giants.
"France just put a digital tax on our great American technology companies. If anybody taxes them, it should be their home Country, the US," Mr Trump wrote on Twitter.
"We will announce a substantial reciprocal action on Macron's foolishness shortly. I've always said American wine is better than French wine!"
Asked about the issue in the Oval Office later, Mr Trump, who is teetotal, said: "I've always liked American wines better than French wines. Even though I don't drink wine. I just like the way they look."
45*'s tariffs so far have cost us in the 100s of billions of dollars in trade, plus the nearly $30 billion he's throwing at American farmers to buy their continued support, plus the fact that the slowdown in international trade has created an additional drag on GDP growth, which was already slowing, and is set to come in at a rather anemic 2.1% for 2019 - on top of the fears that we tip into full blown recession by this time 2020.
All of which makes 45*'s "promise" of 3 or even 4% growth pretty much another great example of a guy trying to convince me the 1985 Yugo is a great car at a great price.
May 14, 2019
Overheard
A president who knows practically nothing about economics started a trade war - because they're "easy to win" - which made it nearly impossible for farmers to sell their goods, so he put them on welfare, paying them money our government has to borrow from the countries he started the war with.
Instead of profiting from the sale of American food to China, 45*'s trade policy has us paying interest to China while our farmers have become dependent on government handouts because they can't sell their crops to China.
And still, this makes enough sense to the rubes that they go right on supporting him.
hat tip = @Mikel_Jollett
Instead of profiting from the sale of American food to China, 45*'s trade policy has us paying interest to China while our farmers have become dependent on government handouts because they can't sell their crops to China.
And still, this makes enough sense to the rubes that they go right on supporting him.
hat tip = @Mikel_Jollett
Dec 3, 2018
Today's Tweet
Wonder how much he thinks they can get for beans and wheat that's mostly slime by now.
Good news, Farmers, he loves you.— Stonekettle (@Stonekettle) December 3, 2018
He loves you like a billionaire loves a porn star. https://t.co/xvfntdYkDR
And how much suffering are the rubes willing to endure just so they can avoid having to admit they're getting played?
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