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What tariff does is that it moves the price point at which the retailers switch to imports a bit higher. Tariff does not eliminate the ceiling. There still woul
by smnrchrds 6y ago
What tariff does is that it moves the price point at which the retailers switch to imports a bit higher. Tariff does not eliminate the ceiling. There still would be a ceiling on price, determined by international commodity price + X% tariff.
- freeone3000 6y agoSo the tariff needs to be high enough to be absolutely ruinous. See, for example, Canada's tariff on dairy. Since Canada runs a cartel on dairy producers, Canada does set the domestic price of milk at $4/gal. This is incompatible with the US subsidy model, where it prices out to around $1.50 a gallon -- so there's a 270% tariff on dairy imports. The great thing about numbers is there's always a bigger one.
- smnrchrds 6y agoYes, you can do that. It's not something the farmers strapped for workers can do, but the government certainly can. It would not be particularly popular in most political climates, so passing such laws in democracies are always difficult. But as the Canada example shows, not impossible.