15 ms·

China Slaps Tariffs on U.S. Products

152 points by johnny313 9y ago

grolimpio 9y ago
Hope Trump keeps pushing China, so they will keep imposing additional tariffs on USA products. Which can ending up being good for us, from outside the USA, by giving us a better deal with China and eventually we will fill the gap, by being the new suppliers for the products that now have a higher tax.
- babayega2 9y ago
  I think China is aware of that. Let's be spectators of this battle.
- jakeogh 9y ago
  It's welfare for China. We know it and they know it. Ending it is good for both of us. Just like any welfare situation, it's very asymmetric.
ethanwillis 9y ago
https://www.salon.com/2018/03/11/elizabeth-warren-is-not-afraid-of-tariffs-and-supports-rethinking-u-s-trade-policy https://www.salon.com/2018/03/11/elizabeth-warren-is-not-afr... "I think that our trade deals have been negotiated for a very, very long time now to benefit large, multinational corporations, not to benefit the American worker," Warren added. In an interview on CNN's "State of the Union" she continued, "What I'd like to see us do is rethink all of our trade policy. And, I have to say, when President Trump says he's putting tariffs on the table, I think tariffs are one part of reworking our trade policy overall." It's gonna be a long process, but necessary.
- tensor 9y ago
  You seem to be assuming that the US will win against the rest of the world. The world isn't entering a trade war, they are still trading like allies do. Is it smart to take on a multi-front war?
  - ethanwillis 9y ago
    It's not a multi-front war actually. The EU was HOPING to be exempt from US tariffs [1]. They are in fact now exempt from tarrifs [2]. 1.) https://www.usatoday.com/story/money/economy/2018/03/14/european-union-questions-trumps-tariffs-hopes-exempt/423332002/ https://www.usatoday.com/story/money/economy/2018/03/14/euro... 2.) http://money.cnn.com/2018/03/22/news/economy/steel-aluminum-tariff-exemptions/index.html http://money.cnn.com/2018/03/22/news/economy/steel-aluminum-...
    - akmarinov 9y ago
      Until May 1st https://www.politico.eu/article/eus-exemption-from-us-steel-aluminum-tariffs-to-expire-may-1-donald-trump/ https://www.politico.eu/article/eus-exemption-from-us-steel-...
      - ethanwillis 9y ago
        Right and the point of this is to have an interim period during which negotiations can begin. The EU is aware of this. “Only reasonable that EU seems to be omitted from tariffs based on national security grounds given that EU and US are close allies,” Danish Prime Minister Lars Loekke Rasmussen wrote on Twitter. “Rather than threatening to raise tariffs against one another EU and US should work together to solve the real problem of overcapacity.” [1] There's no point in doing tariffs and just permanently exempting half of the world's supply of steel, aluminum, etc. The tariffs are definitely pointed at specific countries and to also put pressure on other countries to act alongside the U.S. 1.) https://www.usatoday.com/story/money/economy/2018/03/14/european-union-questions-trumps-tariffs-hopes-exempt/423332002/ https://www.usatoday.com/story/money/economy/2018/03/14/euro...
- OscarCunningham 9y ago
  The corporation vs workers comment seems off. Tariffs on X generally help domestic X producers and hurt domestic X consumers. For most values of X, production is done by companies which are mostly owned by a small number of people, whereas consumption is done by a much broader group. So one would generally expect tariffs to help businesses at the expense of workers. And aren't tariffs usually advertised as helping American businesses? To say now that it hurts them seems like a weird change of tack.
  - ethanwillis 9y ago
    So if you look into Elizabeth Warren's reasoning more one of the reasons she's pro-tariff is that China is essentially making us trade U.S. tech for market access. [1] I think the thinking is that Tariffs will be one way to keep China from abusing that. In any case I think the assumption you're making is that it hurts consumers because it destroys consumption of cheap foreign goods. But I think what you're missing is that it increases consumption of domestic goods made by domestic workers. Obviously analogies are bad for discussing the actual nuance of matters.. but think Walmart in a small town that funnels profits out of the local economy versus small town businesses generating and circulating wealth locally. 1.) http://www.businessinsider.com/r-senator-warren-in-beijing-says-us-is-waking-up-to-chinese-abuses-2018-4 http://www.businessinsider.com/r-senator-warren-in-beijing-s...
    - valuearb 9y ago
      You are missing that it makes goods cost more and people poorer. We don’t want to produce many of these goods domestically because it’s too expensive. Assembling iPhones in the US would mean more crappy domestic jobs paying near minimum wage. It would also make iPhones more expensive, not just for US consumers, but worldwide. So fewer iPhones are sold. Meaning fewer high paying design and engineering jobs at Apple, at app developers, etc. And more of those jobs in South Korea, at Samsung. Free trade is a wonderful thing that makes everyone better off in the long run. A lawyer who fires his secretary to do his own typing because he can type faster than her is a fool.
      - 9y ago
- forapurpose 9y ago
  Reading HN, you'd think the Dems support almost everything Trump does. But the issue is what is the U.S., via President Trump, actually doing, not what is one Senator talking about. My impression is that Trump is pushing tariffs in order to increase nationalism through conflict, i.e., to maximize divides at national borders. It's the same reason he's creating problems for immigrants, including legal ones. (I know HN doesn't like politics, but sometimes politics is factually part of the issue; if HN didn't like IP, we couldn't just omit it from a discussion of routing without being dishonest about what was going on.) Warren's comment isn't evidence that it's necessary, or evidence of anything but her opinion. Is there any evidence, such as a broadly accepted economic analysis, that it's 'necessary'? That there is a problem? What problem? How are tariffs the best way to solve the problem?
  - astebbin 9y ago
    >My impression is that Trump is pushing tariffs in order to increase nationalism through conflict That’s not my impression. I perceive the tariffs as a response to the yawning trade deficit between China and the U.S., as well as China’s state-sponsored IP theft from U.s. companies, currency manipulation, technology transfer requirements for foreign companies, Party cell embedding requirements [0], and various other protectionist policies. As for evidence of necessity: the U.S.-China trade gap is hundreds of billions of dollars, on top of all that other stuff. [0] https://www.washingtonpost.com/world/asia_pacific/command-and-control-chinas-communist-party-extends-reach-into-foreign-companies/2018/01/28/cd49ffa6-fc57-11e7-9b5d-bbf0da31214d_story.html https://www.washingtonpost.com/world/asia_pacific/command-an...
    - tclancy 9y ago
      >yawning trade deficit between China and the U.S. But why does a trade deficit between two specific economies (even the largest ones) mean anything in and of itself? And how would punitive tariffs, which are sure to be responded to in kind, help citizens of the US? If we have a trade deficit with a country, meaning we take in more of their goods than they take in of ours, how is this a good idea? I find it helpful in our current political climate to start by asking, "What if this isn't a completely new paradigm 4D game of political chess but rather idiots doing dumb things?" Given we have seen this particular game played hundreds of times in the past by similarly economically-illiterate ideologues, assuming a different result this time because It's the Future seems hopelessly naive.
- walkingolof 9y ago
  Most of the stuff imported into the US from China is made by US companies for US customers, seeking better margins, is it fair to say that the stock market has something to do with the current sate of affairs and less of country X trying to prey on country Y ?
- AFNobody 9y ago
  Tariffs are not an effective strategy (for workers or corporations) if you believe in modern economic theory. It is 100% unnecessary. The lack of political will to maintain a safety net and retrain people is the problem. Tariffs are just going to make that worse when it starts bleeding the economy.
- ajr0 9y ago
  Economic theory and history [0] day Tariffs are a bad idea. I like Senator Warren but this seems like an idea that will be just as painful as the least time we tried despite the differences in implementation. [0] https://en.m.wikipedia.org/wiki/Smoot%E2%80%93Hawley_Tariff_Act https://en.m.wikipedia.org/wiki/Smoot%E2%80%93Hawley_Tariff_...
  - tabtab 9y ago
    "Smoot-Hawley" is not relevant to our current situation because we had a trade surplus when it was passed. And trade penalties should be applied more gradually to avoid shocking markets. I agree China cheats, and we need to do something, else they will cheat more. Economic models suggest that lopsided trade is still overall good for the "loser" side, but that's in aggregate: specific sectors can still end up with a nasty hit, like the rust-belt did.
  - SamReidHughes 9y ago
    Consider that right now, we have a huge tariff on locally produced human labor. How much does that hurt people in this country, and how big does a tariff on imported goods have to be, to be worse?
  - pure_ambition 9y ago
    Theory like this deserves a thorough review. The classic example oversimplifies, leaving out many important factors - such as what happens when jobs are moved around, and where a nation's wealth is built. Classic example: America can produce 5 cars a year and 6 apples. Japan can produce 3 cars a year and 2 apples. If America devotes its energy to making all the apples and Japan does the same for making all the cars, Japan could make 10 cars a year and America could make 9 apples - so thus, there will now be 10 cars available versus 8 and 9 apples a year versus 8. So there is more product available for everyone, true, that is an undisputed fact. But several questions remain unanswered: What are the effects to the American people if making cars provided a lot of well-paying jobs to its working class which cannot be replaced? The answer is that many people are out of work; and they cannot go make apples because agriculture is heavily automated. They cannot all go to college because they don't have the money and student loans are very expensive. What happens if America spends more money on importing cars from Japan than it makes from selling apples? Is there not a net drain on American wealth? So I think classic theory about these things overlooks many important topics. It reduces a nation's health to the amount of goods that are producible between its economy and its trade partners; if more goods are produced overall then everything is better. But it does not take into account the effects of job losses or trade deficits. Edit: Might I also add that the American economy was heavily protected by tariffs throughout almost its entire development? Tariffs were significantly higher from the 1800s to the 1900s; it is only in recent decades that they have been consistently lower. Andrew Carnegie's Carnegie Steel for example experienced tremendous benefit from high tariffs on steel; the impact of his fortune can still be seen today in almost all American libraries. While the relevance of this anecdote can be disputed, it serves a valuable purpose if it gets us to question our trade dogmas.
- eric-hu 9y ago
  Quoting in a readable format for mobile: > "I think that our trade deals have been negotiated for a very, very long time now to benefit large, multinational corporations, not to benefit the American worker," Warren added. In an interview on CNN's "State of the Union" she continued, "What I'd like to see us do is rethink all of our trade policy. And, I have to say, when President Trump says he's putting tariffs on the table, I think tariffs are one part of reworking our trade policy overall."
pleasecalllater 9y ago
In two years Donald Trump will resign from those tariffs, and he will say it is his great success... and millions of people will be repeating that he's the best president because he removed bad law. The sad state of the peoples' minds.
astebbin 9y ago
Glaringly, the NYT omits the scope of these new Chinese tariffs (on $3 billion in goods [0]), which in comparison to the $60 billion in tariffs recently imposed on China would seem to present Trump with quite a victory. [0] http://money.cnn.com/2018/04/02/news/economy/china-us-tariffs-trade/index.html http://money.cnn.com/2018/04/02/news/economy/china-us-tariff...
- allengeorge 9y ago
  I could be wrong, but IIRC these tariffs are in response to the initial round of steel/aluminum tariffs. They have not responded to the latest round of tariffs.
- seanmcdirmid 9y ago
  This is just the first batch of tariffs, the Chinese press says there will be more.
- glenndebacker 9y ago
  I'm not an economist or an American but from my POV I find the first round of sanctions seems to be very interesting (and may I say) well thought. In this round focusing on agricultural products seems to hit those voters - where I assume - that are mostly Trump voters. I find this very ironic to say the least. Reminds me of the more strategical thinking of possible EU sanctions targeting products that are important for certain high profile republicans and their states.
  - pm90 9y ago
    This could easily backfire though. Voters would want even more bellicose and populist politicians, willing to impose even higher tariffs and even go to war for their perceived "wrongs".
  - adventured 9y ago
    It reveals the nature of the position of each party. The US is targeting tariffs to correct perceived trade wrongs, where foreign nations have barriers that the US does not have. Or in the case of some foreign steel, it's often dumped globally, backed with State subsidies to facilitate that. Take Russian steel as one example. It's extremely difficult to do business in Russia and to sell major industrial products like steel into Russia. Why should the US buy any steel from Russia, when the US is highly capable of producing that steel domestically instead? It makes no sense to tolerate Russia's hyper nationalist protectionism in major industry and continue buying steel from them. Reciprocating their market behavior back toward them means that Russia never gets to sell steel into the US again. Russia buys very little from the US, representing 0.03% of the US economy. The US imports from Russia, including a lot of steel, are equal to 1.5% of the Russian economy. It's obvious which party has a lot to lose there, there's a 50 fold gap in importance to the economy. The EU and China by contrast to the US tariffs, started out targeting the US on political grounds. That tells you everything you need to know. It's because the US has extremely low tariffs overall, and particularly extraordinarily low tariffs on agriculture. These other trade parties have very few angles of attack that aren't political in nature because the US has such a generally open economy.
mark_l_watson 9y ago
What complicates this issue for me is that ‘trade deal’ treaties seem to mostly contain content to protect the interests of large corporations. Really off topic, sorry, but if you enlarge the picture of the three pigs being led to slaughter by the guy holding the electric shock prod, look at their eyes. Pigs are very intelligent animals, and probably understand to some degree what is happening. Although I am not a vegetarian, I think it is shameful to eat ‘torture meat’ like pork, poultry, and veal. Who wants to eat animals that are effectively tortured every day of their lives.
- trisimix 9y ago
  Poultry are some of the most oblivious animals, I think worse is the effect animals like cows have on the environment.
- yohann305 9y ago
  yes, i remember i was told as a kid of someone who worked in a horse meat factory and the screams of horses were horrible. Also i was told one of the horses went to one of the workers and tapped gently on her shoulder and started doing gesture that said "please spare me" (true story)
- cko 9y ago
  I don’t see anything in their eyes, but if it’s sadness you see I’d assume it’s from being separated from their comrades or living in confined spaces all their lives.
- codezero 9y ago
  You're probably being downvoted for being off-topic, but there's scarcely a place on the Internet you can call out the abuse of animals for our culinary pleasure without getting a lot of backlash. People don't want to think about it. I became vegetarian after there was a big news cycle about the dog eating festival in China – then I saw pictures and saw that most of those dogs appeared to be treated much better than the animals that are part of the industrialized meat process. Torture is something, but ultimately we kill them, ending their life so we can eat them. Humans will come up with all kinds of justifications for every part of this process, it's almost not worth arguing, it's like religion in many ways – you're raised eating meat, and it's hard to be rational thinking about why that might be bad, for the creatures being eaten, for the environment, etc...
fwdpropaganda 9y ago
This is a quote from EU tarriff on US, but I found it interesting http://thehill.com/regulation/international/376467-eu-weighs-tariffs-on-bourbon-blue-jeans-harley-davidson http://thehill.com/regulation/international/376467-eu-weighs... > The products listed by Juncker appeared to target industries based in the home states of congressional leaders. Harley-Davidson is based in Wisconsin, the home state of Speaker Paul Ryan (R); Levi Strauss & Co. is headquartered in House Minority Leader Nancy Pelosi's (D) hometown of San Francisco; and bourbon is made in Kentucky, the home state of Senate Majority Leader Mitch McConnell (R).
- r00fus 9y ago
  Warning shot across the bow? I wonder what's next?
- adventured 9y ago
  Both the EU and China started off targeting the US on political grounds because the US is the injured trade party. They have few other vectors of reciprocal tariff targeting because existing US tariffs are lower than nearly all other major economies and the US economy is more open than nearly all other economies. What are they going to target otherwise? The options are slim, maybe the US truck tariffs. Funny enough, re China targeting US agriculture: the US has nearly the lowest agriculture tariffs. Only Australia is lower that I'm aware of among large economies. What's the legitimate grievance that China could possibly have about US agriculture? They obviously have none, it's all political retaliation.
  - fwdpropaganda 9y ago
    > Both the EU and China started off targeting the US on political grounds So US tariffs are justified, but retaliation is political? Is that what you're saying? EDIT: > What's the legitimate grievance that China could possibly have about US agriculture? They obviously have none, it's all political retaliation. Here's a mental model for this. You hit them first, they hit you, now you're complaining that they hit you. "It's political!". The rest of the world is watching and thinking "well, you started it".
loourr 9y ago
Silly since China has been working hard buying up these US industries https://www.pbs.org/newshour/show/whos-behind-chinese-takeover-worlds-biggest-pork-producer https://www.pbs.org/newshour/show/whos-behind-chinese-takeov... Try acting a little less biased NYT, China has had tariffs on US goods for years. They're not the ones retaliating.
- obmelvin 9y ago
  There are many ways to frame this current trade dispute. Sure, there is history here and more to it, but most immediately this is a retaliation. Personally, I'm quite frustrated by Trump's fixation with the trade deficit. I wish he'd focus more on the issues with IP being stolen, bought, or semi-forced technology transfer. There are other advanced countries in the same boat as us and he has the chance to be a leader and form a coalition of ripped off economies. Instead, he focuses on the trade deficit and scares allies, existing and potential, with threats of tariffs instead of forming a united front against China's lack of respect for IP.
  - debacle 9y ago
    What is said in the media and what is said in negotiations are likely very different. Trump is a populist right-moderate politician who appeals to blue collar workers. Trade deficits are easier to understand than IP laws.
  - yardie 9y ago
    > he has the chance to be a leader and form a coalition of ripped off economies. Oh, like some sort of partnership comprised of other Pacific based countries to create some sort of trade agreement that would make the coalition members have a stronger voice when negotiating trade agreements with China? We may even call it a Trans-Pacific Partnership[0]. [0] https://en.wikipedia.org/wiki/Trans-Pacific_Partnership https://en.wikipedia.org/wiki/Trans-Pacific_Partnership
rdlecler1 9y ago
China has effectively been waging a trade war with the US for the past 20 years. This is a narrative that has not been emphasized enough. America just hasn’t responded—which I find baffling. Investment into China is difficult, you need to have JVs and IP hand overs, local companies have political advantage over foreign companies, entire industries are off limits. China is going to be the world’s largest economy soon. It’s time to take off the kids gloves and live up to their WTO promises. The biggest beneficiaries of this are the large multi nationals, not the American workers. The argument goes that the benefit is to the consumer, but if the latest 65” TV cost 50% more then everyone would spend their $1,500 for a 45” TV instead and be just as happy—maybe happier because they’d have good paying jobs. If you think a trade war is bad, imagine being a vassal state of China where the US has no industries left and their political/economic clout is so strong that we live under their rules. And discussions like this would not happen. The fact that I thought about deleting this post is actually chilling.
- Retric 9y ago
  > Investment into China is difficult it's also not trade.
  - fspeech 9y ago
    And it does nothing to reduce trade deficit. If anything it increases the trade deficit. Let me give an example: If Tesla builds a factory in Shanghai, even if it does not import these cars back into the US, it can substitute the current export of US-made cars into Asia and thereby reduce US exports and increase US trade deficits.
    - navait 9y ago
      Why should we care what the trade deficit is?
      - fspeech 9y ago
        I don't know, maybe because it has the word "deficit" in it. Maybe we should rename it "dollar winnings" or "greenback surpluses". I am pretty sure the trade deficit is driven by the desire of people outside of US to own dollars and dollar denominated assets. As long as US has the strongest military and is seen as the haven for the rich people around the world to park their earnings the trade deficit will always be there, unless capital control is imposed.
ancap 9y ago
Economic ignorance abounds in these comments. Tariffs are more accurately termed a punitive tax on consumers. A country enacting reciprocal tariffs is like shooting a hole in your boat to get back at your neighbor who shot a hole in their own boat. It makes no sense.
- Raidion 9y ago
  I mean, it doesn't make sense if everyone is playing fair. You can't negotiate without being willing to sacrifice something to hurt the other side. In war, that's soldiers, in trade wars, that's the consumer. Ideally, everyone looks at their own tariffs and decides these aren't worth it, because, like you said, they hurt consumers. This means everyone lowers tariffs and life continues better than it was before.
  - ancap 9y ago
    Actually, it doesn't make sense even if everyone is not playing fair. Self-harm is self-harm. What kind of negotiating is that? "If you shoot a hole in your boat I'll shoot one in mine!"
eachro 9y ago
Lapham's Quaterly is pretty great https://www.laphamsquarterly.org/ https://www.laphamsquarterly.org/
- marnett 9y ago
  I agree, but this is a tad off topic, no?

152 points by johnny313 9y ago

Hope Trump keeps pushing China, so they will keep imposing additional tariffs on USA products. Which can ending up being good for us, from outside the USA, by giving us a better deal with China and eventually we will fill the gap, by being the new suppliers for the products that now have a higher tax.

babayega2 9y ago
I think China is aware of that. Let's be spectators of this battle.
jakeogh 9y ago
It's welfare for China. We know it and they know it. Ending it is good for both of us. Just like any welfare situation, it's very asymmetric.

ethanwillis 9y ago

https://www.salon.com/2018/03/11/elizabeth-warren-is-not-afraid-of-tariffs-and-supports-rethinking-u-s-trade-policy https://www.salon.com/2018/03/11/elizabeth-warren-is-not-afr... "I think that our trade deals have been negotiated for a very, very long time now to benefit large, multinational corporations, not to benefit the American worker," Warren added. In an interview on CNN's "State of the Union" she continued, "What I'd like to see us do is rethink all of our trade policy. And, I have to say, when President Trump says he's putting tariffs on the table, I think tariffs are one part of reworking our trade policy overall." It's gonna be a long process, but necessary.

tensor 9y ago
You seem to be assuming that the US will win against the rest of the world. The world isn't entering a trade war, they are still trading like allies do. Is it smart to take on a multi-front war?
- ethanwillis 9y ago
  It's not a multi-front war actually. The EU was HOPING to be exempt from US tariffs [1]. They are in fact now exempt from tarrifs [2]. 1.) https://www.usatoday.com/story/money/economy/2018/03/14/european-union-questions-trumps-tariffs-hopes-exempt/423332002/ https://www.usatoday.com/story/money/economy/2018/03/14/euro... 2.) http://money.cnn.com/2018/03/22/news/economy/steel-aluminum-tariff-exemptions/index.html http://money.cnn.com/2018/03/22/news/economy/steel-aluminum-...
  - akmarinov 9y ago
    Until May 1st https://www.politico.eu/article/eus-exemption-from-us-steel-aluminum-tariffs-to-expire-may-1-donald-trump/ https://www.politico.eu/article/eus-exemption-from-us-steel-...
    - ethanwillis 9y ago
      Right and the point of this is to have an interim period during which negotiations can begin. The EU is aware of this. “Only reasonable that EU seems to be omitted from tariffs based on national security grounds given that EU and US are close allies,” Danish Prime Minister Lars Loekke Rasmussen wrote on Twitter. “Rather than threatening to raise tariffs against one another EU and US should work together to solve the real problem of overcapacity.” [1] There's no point in doing tariffs and just permanently exempting half of the world's supply of steel, aluminum, etc. The tariffs are definitely pointed at specific countries and to also put pressure on other countries to act alongside the U.S. 1.) https://www.usatoday.com/story/money/economy/2018/03/14/european-union-questions-trumps-tariffs-hopes-exempt/423332002/ https://www.usatoday.com/story/money/economy/2018/03/14/euro...
OscarCunningham 9y ago
The corporation vs workers comment seems off. Tariffs on X generally help domestic X producers and hurt domestic X consumers. For most values of X, production is done by companies which are mostly owned by a small number of people, whereas consumption is done by a much broader group. So one would generally expect tariffs to help businesses at the expense of workers. And aren't tariffs usually advertised as helping American businesses? To say now that it hurts them seems like a weird change of tack.
- ethanwillis 9y ago
  So if you look into Elizabeth Warren's reasoning more one of the reasons she's pro-tariff is that China is essentially making us trade U.S. tech for market access. [1] I think the thinking is that Tariffs will be one way to keep China from abusing that. In any case I think the assumption you're making is that it hurts consumers because it destroys consumption of cheap foreign goods. But I think what you're missing is that it increases consumption of domestic goods made by domestic workers. Obviously analogies are bad for discussing the actual nuance of matters.. but think Walmart in a small town that funnels profits out of the local economy versus small town businesses generating and circulating wealth locally. 1.) http://www.businessinsider.com/r-senator-warren-in-beijing-says-us-is-waking-up-to-chinese-abuses-2018-4 http://www.businessinsider.com/r-senator-warren-in-beijing-s...
  - valuearb 9y ago
    You are missing that it makes goods cost more and people poorer. We don’t want to produce many of these goods domestically because it’s too expensive. Assembling iPhones in the US would mean more crappy domestic jobs paying near minimum wage. It would also make iPhones more expensive, not just for US consumers, but worldwide. So fewer iPhones are sold. Meaning fewer high paying design and engineering jobs at Apple, at app developers, etc. And more of those jobs in South Korea, at Samsung. Free trade is a wonderful thing that makes everyone better off in the long run. A lawyer who fires his secretary to do his own typing because he can type faster than her is a fool.
    - 9y ago
forapurpose 9y ago
Reading HN, you'd think the Dems support almost everything Trump does. But the issue is what is the U.S., via President Trump, actually doing, not what is one Senator talking about. My impression is that Trump is pushing tariffs in order to increase nationalism through conflict, i.e., to maximize divides at national borders. It's the same reason he's creating problems for immigrants, including legal ones. (I know HN doesn't like politics, but sometimes politics is factually part of the issue; if HN didn't like IP, we couldn't just omit it from a discussion of routing without being dishonest about what was going on.) Warren's comment isn't evidence that it's necessary, or evidence of anything but her opinion. Is there any evidence, such as a broadly accepted economic analysis, that it's 'necessary'? That there is a problem? What problem? How are tariffs the best way to solve the problem?
- astebbin 9y ago
  >My impression is that Trump is pushing tariffs in order to increase nationalism through conflict That’s not my impression. I perceive the tariffs as a response to the yawning trade deficit between China and the U.S., as well as China’s state-sponsored IP theft from U.s. companies, currency manipulation, technology transfer requirements for foreign companies, Party cell embedding requirements [0], and various other protectionist policies. As for evidence of necessity: the U.S.-China trade gap is hundreds of billions of dollars, on top of all that other stuff. [0] https://www.washingtonpost.com/world/asia_pacific/command-and-control-chinas-communist-party-extends-reach-into-foreign-companies/2018/01/28/cd49ffa6-fc57-11e7-9b5d-bbf0da31214d_story.html https://www.washingtonpost.com/world/asia_pacific/command-an...
  - tclancy 9y ago
    >yawning trade deficit between China and the U.S. But why does a trade deficit between two specific economies (even the largest ones) mean anything in and of itself? And how would punitive tariffs, which are sure to be responded to in kind, help citizens of the US? If we have a trade deficit with a country, meaning we take in more of their goods than they take in of ours, how is this a good idea? I find it helpful in our current political climate to start by asking, "What if this isn't a completely new paradigm 4D game of political chess but rather idiots doing dumb things?" Given we have seen this particular game played hundreds of times in the past by similarly economically-illiterate ideologues, assuming a different result this time because It's the Future seems hopelessly naive.
walkingolof 9y ago
Most of the stuff imported into the US from China is made by US companies for US customers, seeking better margins, is it fair to say that the stock market has something to do with the current sate of affairs and less of country X trying to prey on country Y ?
AFNobody 9y ago
Tariffs are not an effective strategy (for workers or corporations) if you believe in modern economic theory. It is 100% unnecessary. The lack of political will to maintain a safety net and retrain people is the problem. Tariffs are just going to make that worse when it starts bleeding the economy.
ajr0 9y ago
Economic theory and history [0] day Tariffs are a bad idea. I like Senator Warren but this seems like an idea that will be just as painful as the least time we tried despite the differences in implementation. [0] https://en.m.wikipedia.org/wiki/Smoot%E2%80%93Hawley_Tariff_Act https://en.m.wikipedia.org/wiki/Smoot%E2%80%93Hawley_Tariff_...
- tabtab 9y ago
  "Smoot-Hawley" is not relevant to our current situation because we had a trade surplus when it was passed. And trade penalties should be applied more gradually to avoid shocking markets. I agree China cheats, and we need to do something, else they will cheat more. Economic models suggest that lopsided trade is still overall good for the "loser" side, but that's in aggregate: specific sectors can still end up with a nasty hit, like the rust-belt did.
- SamReidHughes 9y ago
  Consider that right now, we have a huge tariff on locally produced human labor. How much does that hurt people in this country, and how big does a tariff on imported goods have to be, to be worse?
- pure_ambition 9y ago
  Theory like this deserves a thorough review. The classic example oversimplifies, leaving out many important factors - such as what happens when jobs are moved around, and where a nation's wealth is built. Classic example: America can produce 5 cars a year and 6 apples. Japan can produce 3 cars a year and 2 apples. If America devotes its energy to making all the apples and Japan does the same for making all the cars, Japan could make 10 cars a year and America could make 9 apples - so thus, there will now be 10 cars available versus 8 and 9 apples a year versus 8. So there is more product available for everyone, true, that is an undisputed fact. But several questions remain unanswered: What are the effects to the American people if making cars provided a lot of well-paying jobs to its working class which cannot be replaced? The answer is that many people are out of work; and they cannot go make apples because agriculture is heavily automated. They cannot all go to college because they don't have the money and student loans are very expensive. What happens if America spends more money on importing cars from Japan than it makes from selling apples? Is there not a net drain on American wealth? So I think classic theory about these things overlooks many important topics. It reduces a nation's health to the amount of goods that are producible between its economy and its trade partners; if more goods are produced overall then everything is better. But it does not take into account the effects of job losses or trade deficits. Edit: Might I also add that the American economy was heavily protected by tariffs throughout almost its entire development? Tariffs were significantly higher from the 1800s to the 1900s; it is only in recent decades that they have been consistently lower. Andrew Carnegie's Carnegie Steel for example experienced tremendous benefit from high tariffs on steel; the impact of his fortune can still be seen today in almost all American libraries. While the relevance of this anecdote can be disputed, it serves a valuable purpose if it gets us to question our trade dogmas.
eric-hu 9y ago
Quoting in a readable format for mobile: > "I think that our trade deals have been negotiated for a very, very long time now to benefit large, multinational corporations, not to benefit the American worker," Warren added. In an interview on CNN's "State of the Union" she continued, "What I'd like to see us do is rethink all of our trade policy. And, I have to say, when President Trump says he's putting tariffs on the table, I think tariffs are one part of reworking our trade policy overall."

pleasecalllater 9y ago

In two years Donald Trump will resign from those tariffs, and he will say it is his great success... and millions of people will be repeating that he's the best president because he removed bad law. The sad state of the peoples' minds.

astebbin 9y ago

Glaringly, the NYT omits the scope of these new Chinese tariffs (on $3 billion in goods [0]), which in comparison to the $60 billion in tariffs recently imposed on China would seem to present Trump with quite a victory. [0] http://money.cnn.com/2018/04/02/news/economy/china-us-tariffs-trade/index.html http://money.cnn.com/2018/04/02/news/economy/china-us-tariff...

allengeorge 9y ago
I could be wrong, but IIRC these tariffs are in response to the initial round of steel/aluminum tariffs. They have not responded to the latest round of tariffs.
seanmcdirmid 9y ago
This is just the first batch of tariffs, the Chinese press says there will be more.
glenndebacker 9y ago
I'm not an economist or an American but from my POV I find the first round of sanctions seems to be very interesting (and may I say) well thought. In this round focusing on agricultural products seems to hit those voters - where I assume - that are mostly Trump voters. I find this very ironic to say the least. Reminds me of the more strategical thinking of possible EU sanctions targeting products that are important for certain high profile republicans and their states.
- pm90 9y ago
  This could easily backfire though. Voters would want even more bellicose and populist politicians, willing to impose even higher tariffs and even go to war for their perceived "wrongs".
- adventured 9y ago
  It reveals the nature of the position of each party. The US is targeting tariffs to correct perceived trade wrongs, where foreign nations have barriers that the US does not have. Or in the case of some foreign steel, it's often dumped globally, backed with State subsidies to facilitate that. Take Russian steel as one example. It's extremely difficult to do business in Russia and to sell major industrial products like steel into Russia. Why should the US buy any steel from Russia, when the US is highly capable of producing that steel domestically instead? It makes no sense to tolerate Russia's hyper nationalist protectionism in major industry and continue buying steel from them. Reciprocating their market behavior back toward them means that Russia never gets to sell steel into the US again. Russia buys very little from the US, representing 0.03% of the US economy. The US imports from Russia, including a lot of steel, are equal to 1.5% of the Russian economy. It's obvious which party has a lot to lose there, there's a 50 fold gap in importance to the economy. The EU and China by contrast to the US tariffs, started out targeting the US on political grounds. That tells you everything you need to know. It's because the US has extremely low tariffs overall, and particularly extraordinarily low tariffs on agriculture. These other trade parties have very few angles of attack that aren't political in nature because the US has such a generally open economy.

mark_l_watson 9y ago

What complicates this issue for me is that ‘trade deal’ treaties seem to mostly contain content to protect the interests of large corporations. Really off topic, sorry, but if you enlarge the picture of the three pigs being led to slaughter by the guy holding the electric shock prod, look at their eyes. Pigs are very intelligent animals, and probably understand to some degree what is happening. Although I am not a vegetarian, I think it is shameful to eat ‘torture meat’ like pork, poultry, and veal. Who wants to eat animals that are effectively tortured every day of their lives.

trisimix 9y ago
Poultry are some of the most oblivious animals, I think worse is the effect animals like cows have on the environment.
yohann305 9y ago
yes, i remember i was told as a kid of someone who worked in a horse meat factory and the screams of horses were horrible. Also i was told one of the horses went to one of the workers and tapped gently on her shoulder and started doing gesture that said "please spare me" (true story)
cko 9y ago
I don’t see anything in their eyes, but if it’s sadness you see I’d assume it’s from being separated from their comrades or living in confined spaces all their lives.
codezero 9y ago
You're probably being downvoted for being off-topic, but there's scarcely a place on the Internet you can call out the abuse of animals for our culinary pleasure without getting a lot of backlash. People don't want to think about it. I became vegetarian after there was a big news cycle about the dog eating festival in China – then I saw pictures and saw that most of those dogs appeared to be treated much better than the animals that are part of the industrialized meat process. Torture is something, but ultimately we kill them, ending their life so we can eat them. Humans will come up with all kinds of justifications for every part of this process, it's almost not worth arguing, it's like religion in many ways – you're raised eating meat, and it's hard to be rational thinking about why that might be bad, for the creatures being eaten, for the environment, etc...

fwdpropaganda 9y ago

This is a quote from EU tarriff on US, but I found it interesting http://thehill.com/regulation/international/376467-eu-weighs-tariffs-on-bourbon-blue-jeans-harley-davidson http://thehill.com/regulation/international/376467-eu-weighs... > The products listed by Juncker appeared to target industries based in the home states of congressional leaders. Harley-Davidson is based in Wisconsin, the home state of Speaker Paul Ryan (R); Levi Strauss & Co. is headquartered in House Minority Leader Nancy Pelosi's (D) hometown of San Francisco; and bourbon is made in Kentucky, the home state of Senate Majority Leader Mitch McConnell (R).

r00fus 9y ago
Warning shot across the bow? I wonder what's next?
adventured 9y ago
Both the EU and China started off targeting the US on political grounds because the US is the injured trade party. They have few other vectors of reciprocal tariff targeting because existing US tariffs are lower than nearly all other major economies and the US economy is more open than nearly all other economies. What are they going to target otherwise? The options are slim, maybe the US truck tariffs. Funny enough, re China targeting US agriculture: the US has nearly the lowest agriculture tariffs. Only Australia is lower that I'm aware of among large economies. What's the legitimate grievance that China could possibly have about US agriculture? They obviously have none, it's all political retaliation.
- fwdpropaganda 9y ago
  > Both the EU and China started off targeting the US on political grounds So US tariffs are justified, but retaliation is political? Is that what you're saying? EDIT: > What's the legitimate grievance that China could possibly have about US agriculture? They obviously have none, it's all political retaliation. Here's a mental model for this. You hit them first, they hit you, now you're complaining that they hit you. "It's political!". The rest of the world is watching and thinking "well, you started it".

loourr 9y ago

Silly since China has been working hard buying up these US industries https://www.pbs.org/newshour/show/whos-behind-chinese-takeover-worlds-biggest-pork-producer https://www.pbs.org/newshour/show/whos-behind-chinese-takeov... Try acting a little less biased NYT, China has had tariffs on US goods for years. They're not the ones retaliating.

obmelvin 9y ago
There are many ways to frame this current trade dispute. Sure, there is history here and more to it, but most immediately this is a retaliation. Personally, I'm quite frustrated by Trump's fixation with the trade deficit. I wish he'd focus more on the issues with IP being stolen, bought, or semi-forced technology transfer. There are other advanced countries in the same boat as us and he has the chance to be a leader and form a coalition of ripped off economies. Instead, he focuses on the trade deficit and scares allies, existing and potential, with threats of tariffs instead of forming a united front against China's lack of respect for IP.
- debacle 9y ago
  What is said in the media and what is said in negotiations are likely very different. Trump is a populist right-moderate politician who appeals to blue collar workers. Trade deficits are easier to understand than IP laws.
- yardie 9y ago
  > he has the chance to be a leader and form a coalition of ripped off economies. Oh, like some sort of partnership comprised of other Pacific based countries to create some sort of trade agreement that would make the coalition members have a stronger voice when negotiating trade agreements with China? We may even call it a Trans-Pacific Partnership[0]. [0] https://en.wikipedia.org/wiki/Trans-Pacific_Partnership https://en.wikipedia.org/wiki/Trans-Pacific_Partnership

rdlecler1 9y ago

China has effectively been waging a trade war with the US for the past 20 years. This is a narrative that has not been emphasized enough. America just hasn’t responded—which I find baffling. Investment into China is difficult, you need to have JVs and IP hand overs, local companies have political advantage over foreign companies, entire industries are off limits. China is going to be the world’s largest economy soon. It’s time to take off the kids gloves and live up to their WTO promises. The biggest beneficiaries of this are the large multi nationals, not the American workers. The argument goes that the benefit is to the consumer, but if the latest 65” TV cost 50% more then everyone would spend their $1,500 for a 45” TV instead and be just as happy—maybe happier because they’d have good paying jobs. If you think a trade war is bad, imagine being a vassal state of China where the US has no industries left and their political/economic clout is so strong that we live under their rules. And discussions like this would not happen. The fact that I thought about deleting this post is actually chilling.

Retric 9y ago
> Investment into China is difficult it's also not trade.
- fspeech 9y ago
  And it does nothing to reduce trade deficit. If anything it increases the trade deficit. Let me give an example: If Tesla builds a factory in Shanghai, even if it does not import these cars back into the US, it can substitute the current export of US-made cars into Asia and thereby reduce US exports and increase US trade deficits.
  - navait 9y ago
    Why should we care what the trade deficit is?
    - fspeech 9y ago
      I don't know, maybe because it has the word "deficit" in it. Maybe we should rename it "dollar winnings" or "greenback surpluses". I am pretty sure the trade deficit is driven by the desire of people outside of US to own dollars and dollar denominated assets. As long as US has the strongest military and is seen as the haven for the rich people around the world to park their earnings the trade deficit will always be there, unless capital control is imposed.

ancap 9y ago

Economic ignorance abounds in these comments. Tariffs are more accurately termed a punitive tax on consumers. A country enacting reciprocal tariffs is like shooting a hole in your boat to get back at your neighbor who shot a hole in their own boat. It makes no sense.

Raidion 9y ago
I mean, it doesn't make sense if everyone is playing fair. You can't negotiate without being willing to sacrifice something to hurt the other side. In war, that's soldiers, in trade wars, that's the consumer. Ideally, everyone looks at their own tariffs and decides these aren't worth it, because, like you said, they hurt consumers. This means everyone lowers tariffs and life continues better than it was before.
- ancap 9y ago
  Actually, it doesn't make sense even if everyone is not playing fair. Self-harm is self-harm. What kind of negotiating is that? "If you shoot a hole in your boat I'll shoot one in mine!"

eachro 9y ago

Lapham's Quaterly is pretty great https://www.laphamsquarterly.org/ https://www.laphamsquarterly.org/

marnett 9y ago
I agree, but this is a tad off topic, no?