4 ms·
Tariffs Tax the Poor More Than the Rich
- sokoloff 4y agoThis seems to skip the plausible beneficial protective effect for on-shore manufacturing. This effect would also (presumably) be stronger at the lower in income levels than at the higher levels.
- 0x445442 4y agoYou beat me to it. I didn’t read the article, do they even consider this component? Joe Sixpack has to pay 10% more for goods he previously couldn’t afford at all because but he has a job now.
- miguelazo 4y agoOf course they don't consider that, it's Cato. I haven't bothered reading their papers in years. Sad how often their crap shows up on HN, to be frank.
- refurb 4y agoNothing wrong with fundamentally disagreeing with Cato's viewpoint, but if you don't read people who disagree with you, you end up with a very narrow perspective.
- miguelazo 4y agoI completely agree with reading people you disagree with, but I like for them to be halfway intelligent, instead of just a bunch of hacks regurgitating cliches and platitudes from cherry-picked data and scenarios.
- refurb 4y agoYou see? Your viewpoint is already narrow. You may disagree with Cato but it’s not a “bunch of hacks”. You sound like a right wing person claiming the ACLU is a “bunch of hacks”.
- miguelazo 4y agoHow is it narrow? I said I am happy to read libertarian and conservative perspectives, just not Cato. Given its founding, funding, staff, and output, it's not worth my time. If I wanted to read neoliberal corporatist talking points, I would just read mainstream news.
- rayiner 4y agoI’m not at all libertarian. But Cato does excellent work, even if I disagree that paying the lowest price for bananas and TVs should be the goal of public policy.
- miguelazo 4y agoDo you have an example? The article that started this thread is abysmal, as are all the other recent ones I have seen posted to HN.
- mixedCase 4y agoWithout a specific national strategic reason, why should poor people pay for manufacturers who cannot compete on the global scale? Why not let those manufacturers naturally compete fairly or switch to something more useful for humanity rather than overpriced goods and/or services? Protectionism plays favorites within your general population and devalues your economy by taking away the need for people to provide added value.
- sokoloff 4y agoI generally agree with you, by the way. However, there is an argument that holds some water that protectionist policies do actually help some domestic workers. To completely ignore that makes the article read as quite biased to me.
- miguelazo 4y agoThis is a laughable hypothetical with no basis in all of economic history. Every industrialized economy achieved their manufacturing prowess and prosperity through protectionism. It's unfortunate how few people recognize that, but then most people don't get beyond Econ 101 thinking. It's worse than if they had not learned any economics at all. https://www.goodreads.com/book/show/1032019.Bad_Samaritans https://www.goodreads.com/book/show/1032019.Bad_Samaritans
- s1artibartfast 4y agoProtectionism helps you progress up the economic ladder of manufacturing Goods and services. What I think is a lot less clear is how it benefits you once you have a well-developed economy.
- miguelazo 4y agoThe Swiss seem to be doing quite well.
- leereeves 4y ago> Why not let those manufacturers naturally compete fairly It's not a fair competition if local manufacturers are subject to regulations that foreign manufacturers aren't. And if you like high wages for workers, environmental protections, product safety, and the other benefits of regulation, then you need local manufacturers who can be required to provide those things. Why should we participate in a race to the bottom competing over who can pay the lowest wages and dispose of hazardous waste for the lowest cost?
- whywhywhydude 4y agoIt cost Americans tax payers $800000 per job for the few extra jobs created by the washing machine tariff- www.washingtonpost.com/us-policy/2019/04/23/trumps-washing-machine-tariffs-cost-us-consumers-every-job-created/. Do you have any data that supports your claim?
- sokoloff 4y agoThe people who hold those very jobs were helped more than they paid for their share of those costs. (I don’t think it’s a good policy overall, but to treat it like there’s literally no upside for anyone reads like telling a partial story.)
- isthisthingon99 4y agoPretty much true for everything. Most policies only mildly inconvenience the rich.
- missedthecue 4y agohttps://en.m.wikipedia.org/wiki/Director%27s_law https://en.m.wikipedia.org/wiki/Director%27s_law
- isthisthingon99 4y agoLogical
- yellowapple 4y agoOne of the key exceptions is a land value tax; seeing as how land ownership by value is concentrated among the rich and powerful, taxing said land value would be inherently maximally progressive (and also happens to be close to ideal in terms of economic efficiency). Surprise surprise, said rich and powerful have gone out of their way to not only resist implementing such a tax, but ensure that the media and education systems under their control pretend it doesn't exist.
- isthisthingon99 4y agoIt's weird though I hear all my middle class friends complain about property tax. Is there a difference?
- yellowapple 4y agoProperty tax taxes both the land and the house on it. Land value tax only taxes the land. For most middle-class homeowners, the house itself constitutes the majority of the overall property value; replacing property tax with land value tax (such that the tax revenue remains the same) would accordingly result in a lower tax burden for most of the middle class. Replacing sales and income taxes with land value tax in the same vein would in turn reduce middle-class tax burdens further and entirely eliminate lower-class tax burdens. Additionally, one of the side effects of property tax is that it penalizes development; development increases the overall property value, so expanding an apartment complex or what have you results in a higher tax burden. Land value tax doesn't have that issue, and instead does the opposite: you're encouraged to develop your properties as much as possible to cover the land value tax. This in turn helps address housing supply shortages (apartment complexes are motivated to amortize their LVT across as many tenants as possible - and can't price LVT into rents without hurting profit margins, due to land having inelastic supply and therefore land value being driven entirely by demand).
- BMc2020 4y agoI only need to see cato.org to properly categorize this post.
- miguelazo 4y agoThis is absolutely correct. You only need to look at the funding/leadership of a think thank to get a sense of what they're up to. Cato is complete trash. https://www.influencewatch.org/non-profit/cato-institute/ https://www.influencewatch.org/non-profit/cato-institute/
- rayiner 4y agoCato and other libertarian organizations really miss the point. Free trade and free movement of labor (which are two sides of the same coin) will give you economic efficiency. But economic efficiency doesn’t make people happy. Living in stable, cohesive communities where there are jobs and people can raise their kids near their extended family without moving around to chase opportunities is what makes many (I’d argue most) people happy. Many people would rather have that and pay more money for widgets and strawberries. My family immigrated to northern Virginia in 1989 when it was still a bit southern and quite homogenous. It was a warm, friendly community. Fast forward 30 years. It’s much richer. There’s a Google office in Reston which used to be a bit downscale. Immigrants chasing high paying American jobs are a big chunk of the population. So are transplants from other parts of the country. And all the soul of the place is gone. The warm community has been replaced by a bunch of people living next to each other. That’s the kind of society free trade and fee movement of labor creates and many people don’t like it.
- tptacek 4y agoJust bring them a tray of brownies when they move in, and say hi to them when they pull in in the afternoon. A neighborhood isn't a birthright; it's a thing you (and all of your neighbors) consciously build. Maybe you need to have the one neighbor who really goes nuts working at it, hosting game nights and organizing the block parties, to really grok this. Economic systems don't really come into it. The neoliberal economic system moved that neighbor of mine to Dallas, and we still all talk to him on Facebook. Presumably he's mobilized his Dallas block similarly. Be that person, or be receptive to that person, and acquire and calibrate your principles of justice separately, because your community doesn't depend on what you believe about health care funding or the max/median wage ratio. I don't disagree with the argument that our current economic order demands that people move away from their extended families, and that that's bad. But that's no excuse to stop being a good neighbor, or to pretend you need to move to a neighboring county just to continue keeping up your end of the bargain.
- rayiner 4y agoEconomic systems drive patterns of migration, which pulls apart and reshuffles communities. For example in our current economic system, people are pushed to move to large metro areas to pursue economic opportunities, which leaves them without kinship support networks, and fragments the communities which they leave. Building communities is a lot of work and takes time. In many countries around the world, people’s names include the name of your father (“bin” in Arabic, “son” or “dottir” in Swedish). In those places, communities are the product of multigenerational efforts. Communities like that can’t be sustained within an economic construct that requires each generation to move around because of free flow of capital and labor. And diversity in language and culture—a byproduct of economic structures that encourage migration—makes building close communities more difficult. There’s an enormous amount of shared assumptions and context within a particular culture, and cultural differences create friction. Most people would just rather be around what’s familiar, and when thrust into a diverse community won’t make the effort to overcome those barriers. You’ll see that in diverse cities like Toronto or New York, the most cohesive communities are homogenous enclaves, where everyone goes to the same church or mosque, recognize kinship ties, etc.