6 ms·

Tariffs against China are actually a tax on the American citizens, and only causes increased prices and unemployment.

teknopurge 7y ago
false. no matter how many times people say this your statement is incorrect. Consumers faced with higher prices will spend less and save more. Taxes are only applied to transactions. Higher tariffs will shift consumption to lower-priced goods - you say those goods don't exist? That's how new business and market opportunities arise. Production will shift geographies, as the tariffs are geography-specific. China's government is playing checkers, I never thought I would say this, and Trump is playing chess.
- mooreds 7y ago
  Both clauses are false? "Tariffs against China are actually a tax on the American citizens" is undeniably true. "Tariffs are a tax on imports. They're typically charged as a percentage of the transaction price that a buyer pays a foreign seller. Say an American retailer buys 100 garden umbrellas from China for $5 apiece, or $500. The U.S. tariff rate for the umbrellas is 6.5 percent for umbrellas. The retailer would have to pay a $32.50 tariff on the shipment, raising the total price from $500 to $532.50." - https://www.cbsnews.com/news/what-are-tariffs-and-how-would-they-work-trump-2018-06-02/ https://www.cbsnews.com/news/what-are-tariffs-and-how-would-... The latter clause is a matter of second order effects that people can disagree with.
  - teknopurge 7y ago
    You proved my point. Umbrella seller will sell fewer of those China-imported umbrellas. In comes African umbrella maker for $4 apiece.
    - mooreds 7y ago
      Actually, if the African umbrella maker could make a profit at $4, they would already be doing that, pre-tariff. So they are more likely selling at $5.15 (or some other higher number), which means that the US consumer pays an extra 15 cents per umbrella. That 15 cents is additional and what people refer to as a "tax", though it isn't a traditionally levied tax.
      - teknopurge 7y ago
        Markets are not perfectly efficient - this is why arbitrage exists. It likely will take some event, some slack, some inelegance for a business or entrepreneur to notice that the delta between that $5/umbrella and where they can figure out how to deliver it for $4 is worth spending time and attention on. Markets are not perfectly efficient. Markets are perfectly imperfect.
        inflatableDodo 7y ago
        >Markets are perfectly imperfect. You should start writing speeches for Theresa May. This is the kind of guff she regularly comes out with.
        dang 7y ago
        Please don't break the site guidelines like this, regardless of how annoying another comment is or feels. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
        inflatableDodo 7y ago
        Yeah, sorry. I think I managed to break a few there.
        hatchback176 7y ago
        Say whatever you want. The endgame for censorship types is to automate the process and remove the human element from online interactions.
    - po 7y ago
      He didn't prove your point. You're not making sense. You agree with him except for the last point. The parent comment said: Tariffs against China are actually a tax on the American citizens, and only causes increased prices and unemployment. and as far as I can tell you believe: Tariffs against China are actually a tax on the American citizens, which causes increased prices and (eventually?) a shift to a different producer. but that's not the argument you're making.
    - SketchySeaBeast 7y ago
      Are there other locations in the world that has either the current capacity or the ability to ramp up to that quickly and cheaply to match China's current production levels? Supply doesn't come out of nowhere, and America is a prodigious consumer.
    - civilitty 7y ago
      No he hasn't. You haven't proved that African umbrellas even exist for $4. If they did, we would have been buying them instead of the $5 chinese umbrella long ago, or at least the people who didnt want chinese umbrellas would have supported them.
  - ALittleLight 7y ago
    Suppose the cost that the market will pay for umbrellas is X. Presumably the Chinese manufacturers have found X and set their prices accordingly and have profit Y per umbrella. Now the price increases by tariff Z - either fewer umbrellas will be sold or Y will decrease to mitigate price increase, or some combination of both. Tariffs are a tax on imports and in some sense have to be paid by the customer, but they are also a problem for the supplier.
  - selimthegrim 7y ago
    This reasoning is similar to Donna Brazile ordering radio ads in New Orleans and Chicago for Hillary on the theory people there will call up their relatives in swing states and remind them to vote
- cmurf 7y ago
  You ignore the degree of price inelasticity for the products China produces and exports to the U.S. If we were still in the TPP, the U.S. could still come out ahead, but once the U.S. withdrew, the remaining countries have been cutting deals with China. The question is whether those deals make up for the U.S. losses enough for China to weather the economic storm in the short term for a longer term gain. Global free trade benefited the American consumer by letting them keep more money in their pocket for other things through cheaper products. And these fake tariffs which China does not pay a dime of, are a regressive import tax that in that short term negatively impact the American consumer by taking money out of their pocket. It's not at all clear how the market will adjust. Or even if it can because Trump keeps changing his mind on rather important details. What he supposedly ultimately wants is "fair trade" as in no tariffs for anyone? I doubt that he's completely non-protectionist if it turns out some other country can simply out compete the U.S. But then what does 0% tariff/import tax actually translate into in terms of the geographic location for production? It definitely moves to the location with the cheapest net cost for labor and taxes. And that's not going to be the U.S. Which is fine, the American consumer still comes out ahead, but that is not at all compatible with the claims Trump makes about his notion of protectionism creating high paying American jobs. That is a fantasy on the face of it.
mc32 7y ago
Or, this represents the real price of goods including externalities which are ordinarily absorbed by Chinese citizens...
- NotPaidToPost 7y ago
  Those tax duties are arbitrary. Chinese citizens have become dramatically richer through exports and the price of Chinese goods simply reflects that costs are lower in China (though the difference is narrowing).
  - vonmoltke 7y ago
    > Those tax duties are arbitrary. Most taxes associated with externalities are arbitrary (in amount), because externalities are much easier to see than to quantify.
howard941 7y ago
In $DAY_JOB we've not upped prices, the massive tax cuts easily made up for the cost of sending the work elsewhere or incurring the expenses/realizing the benefits of doing the work over here. I realize not everyone has that luxury.
ThomPete 7y ago
So is not allowing American companies to compete on Chinese markets, not having your intellectual property rights upheld and competing against a country which is still categorized as a developing nation. Before trump came in 4million jobs was lost to China alone, in exchange we got cheaper flatscreen televisions. I'll take more expensive flatscreen televisions to make sure that China doesn't end up running over us all any day. The chinese government (not the chinese people) is being controlled by a bunch of powerhungry men who will do everything to take over the world. This is not just about economics it's about taking a stance for a more fair market. So yes it will cost but it will be worth it.
- jf22 7y ago
  Just to clarify, the cost will be worth it if we get something in return. Right now we have tariffs and all the negative things in the first sentence.
  - ThomPete 7y ago
    Right now we have the lowest unemployment ever plus a number of other amazing numbers. To claim the US economy is bad right now would be pretty out there. And thats despite us already having started the tarrif game with China. I can live with a few things being a little more expensive when the jobs are coming back even in blue collar areas as they are right now.
    - amanaplanacanal 7y ago
      You seem to be implying that current low unemployment is caused by tariffs on china. I rather suspect that it is caused by continuing low interest rates and has nothing to do with tariffs.
      - ThomPete 7y ago
        No, I am implying that despite our war with China which have already been going on (with tariffs) we still have one of the lowest unemployment and strongest economies ever. Make of that what you want.
fredgrott 7y ago
ah nooo what happens is this: 1 User consumers spend less choosing other lower price non China products. 2. Factories move from China to India and other Asian locations 3. Some Tariff money does get into US Treasury 4. I do not think that really any US Politician is worried about any increase in China unemployment... The real strategy is this... China monetary system upholds Russia's Trump's real move is against Russia not China despite his shaddy collusion dealings with Russia

false. no matter how many times people say this your statement is incorrect. Consumers faced with higher prices will spend less and save more. Taxes are only applied to transactions. Higher tariffs will shift consumption to lower-priced goods - you say those goods don't exist? That's how new business and market opportunities arise. Production will shift geographies, as the tariffs are geography-specific. China's government is playing checkers, I never thought I would say this, and Trump is playing chess.

mooreds 7y ago
Both clauses are false? "Tariffs against China are actually a tax on the American citizens" is undeniably true. "Tariffs are a tax on imports. They're typically charged as a percentage of the transaction price that a buyer pays a foreign seller. Say an American retailer buys 100 garden umbrellas from China for $5 apiece, or $500. The U.S. tariff rate for the umbrellas is 6.5 percent for umbrellas. The retailer would have to pay a $32.50 tariff on the shipment, raising the total price from $500 to $532.50." - https://www.cbsnews.com/news/what-are-tariffs-and-how-would-they-work-trump-2018-06-02/ https://www.cbsnews.com/news/what-are-tariffs-and-how-would-... The latter clause is a matter of second order effects that people can disagree with.
- teknopurge 7y ago
  You proved my point. Umbrella seller will sell fewer of those China-imported umbrellas. In comes African umbrella maker for $4 apiece.
  - mooreds 7y ago
    Actually, if the African umbrella maker could make a profit at $4, they would already be doing that, pre-tariff. So they are more likely selling at $5.15 (or some other higher number), which means that the US consumer pays an extra 15 cents per umbrella. That 15 cents is additional and what people refer to as a "tax", though it isn't a traditionally levied tax.
    - teknopurge 7y ago
      Markets are not perfectly efficient - this is why arbitrage exists. It likely will take some event, some slack, some inelegance for a business or entrepreneur to notice that the delta between that $5/umbrella and where they can figure out how to deliver it for $4 is worth spending time and attention on. Markets are not perfectly efficient. Markets are perfectly imperfect.
      - inflatableDodo 7y ago
        >Markets are perfectly imperfect. You should start writing speeches for Theresa May. This is the kind of guff she regularly comes out with.
        dang 7y ago
        Please don't break the site guidelines like this, regardless of how annoying another comment is or feels. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
        inflatableDodo 7y ago
        Yeah, sorry. I think I managed to break a few there.
        hatchback176 7y ago
        Say whatever you want. The endgame for censorship types is to automate the process and remove the human element from online interactions.
  - po 7y ago
    He didn't prove your point. You're not making sense. You agree with him except for the last point. The parent comment said: Tariffs against China are actually a tax on the American citizens, and only causes increased prices and unemployment. and as far as I can tell you believe: Tariffs against China are actually a tax on the American citizens, which causes increased prices and (eventually?) a shift to a different producer. but that's not the argument you're making.
  - SketchySeaBeast 7y ago
    Are there other locations in the world that has either the current capacity or the ability to ramp up to that quickly and cheaply to match China's current production levels? Supply doesn't come out of nowhere, and America is a prodigious consumer.
  - civilitty 7y ago
    No he hasn't. You haven't proved that African umbrellas even exist for $4. If they did, we would have been buying them instead of the $5 chinese umbrella long ago, or at least the people who didnt want chinese umbrellas would have supported them.
- ALittleLight 7y ago
  Suppose the cost that the market will pay for umbrellas is X. Presumably the Chinese manufacturers have found X and set their prices accordingly and have profit Y per umbrella. Now the price increases by tariff Z - either fewer umbrellas will be sold or Y will decrease to mitigate price increase, or some combination of both. Tariffs are a tax on imports and in some sense have to be paid by the customer, but they are also a problem for the supplier.
- selimthegrim 7y ago
  This reasoning is similar to Donna Brazile ordering radio ads in New Orleans and Chicago for Hillary on the theory people there will call up their relatives in swing states and remind them to vote
cmurf 7y ago
You ignore the degree of price inelasticity for the products China produces and exports to the U.S. If we were still in the TPP, the U.S. could still come out ahead, but once the U.S. withdrew, the remaining countries have been cutting deals with China. The question is whether those deals make up for the U.S. losses enough for China to weather the economic storm in the short term for a longer term gain. Global free trade benefited the American consumer by letting them keep more money in their pocket for other things through cheaper products. And these fake tariffs which China does not pay a dime of, are a regressive import tax that in that short term negatively impact the American consumer by taking money out of their pocket. It's not at all clear how the market will adjust. Or even if it can because Trump keeps changing his mind on rather important details. What he supposedly ultimately wants is "fair trade" as in no tariffs for anyone? I doubt that he's completely non-protectionist if it turns out some other country can simply out compete the U.S. But then what does 0% tariff/import tax actually translate into in terms of the geographic location for production? It definitely moves to the location with the cheapest net cost for labor and taxes. And that's not going to be the U.S. Which is fine, the American consumer still comes out ahead, but that is not at all compatible with the claims Trump makes about his notion of protectionism creating high paying American jobs. That is a fantasy on the face of it.

mc32 7y ago

Or, this represents the real price of goods including externalities which are ordinarily absorbed by Chinese citizens...

NotPaidToPost 7y ago
Those tax duties are arbitrary. Chinese citizens have become dramatically richer through exports and the price of Chinese goods simply reflects that costs are lower in China (though the difference is narrowing).
- vonmoltke 7y ago
  > Those tax duties are arbitrary. Most taxes associated with externalities are arbitrary (in amount), because externalities are much easier to see than to quantify.

howard941 7y ago

In $DAY_JOB we've not upped prices, the massive tax cuts easily made up for the cost of sending the work elsewhere or incurring the expenses/realizing the benefits of doing the work over here. I realize not everyone has that luxury.

ThomPete 7y ago

So is not allowing American companies to compete on Chinese markets, not having your intellectual property rights upheld and competing against a country which is still categorized as a developing nation. Before trump came in 4million jobs was lost to China alone, in exchange we got cheaper flatscreen televisions. I'll take more expensive flatscreen televisions to make sure that China doesn't end up running over us all any day. The chinese government (not the chinese people) is being controlled by a bunch of powerhungry men who will do everything to take over the world. This is not just about economics it's about taking a stance for a more fair market. So yes it will cost but it will be worth it.

jf22 7y ago
Just to clarify, the cost will be worth it if we get something in return. Right now we have tariffs and all the negative things in the first sentence.
- ThomPete 7y ago
  Right now we have the lowest unemployment ever plus a number of other amazing numbers. To claim the US economy is bad right now would be pretty out there. And thats despite us already having started the tarrif game with China. I can live with a few things being a little more expensive when the jobs are coming back even in blue collar areas as they are right now.
  - amanaplanacanal 7y ago
    You seem to be implying that current low unemployment is caused by tariffs on china. I rather suspect that it is caused by continuing low interest rates and has nothing to do with tariffs.
    - ThomPete 7y ago
      No, I am implying that despite our war with China which have already been going on (with tariffs) we still have one of the lowest unemployment and strongest economies ever. Make of that what you want.

fredgrott 7y ago

ah nooo what happens is this: 1 User consumers spend less choosing other lower price non China products. 2. Factories move from China to India and other Asian locations 3. Some Tariff money does get into US Treasury 4. I do not think that really any US Politician is worried about any increase in China unemployment... The real strategy is this... China monetary system upholds Russia's Trump's real move is against Russia not China despite his shaddy collusion dealings with Russia