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Aren’t tariffs just corporate taxes which are paid by big corps who import stuff built overseas? At least when you incentivize stuff to get built here the mone

• legitster 2y ago
  > At least when you incentivize stuff to get built here the money goes to union workers or at least stays within the US. We could frame this another way - if every state in the US enacted tariffs on every other state, would we all be collectively richer or poorer? Maybe some states could set up their own cottage automotive industry, but overall there is going to be more deadweight loss to the economy than revenue made by the tariffs.
  • BytesAndGears 2y ago
    It depends… do the states share a common set of laws and values? Do the benefits of one state profiting transfer in part to other states? Is there a course for grievances to be settled across state lines with reciprocal legal coverage guaranteed? Are living and working standards reasonably similar, allowing companies to fairly compete across state lines? Those statements are generally not true across countries, but generally are true across states within a country. Things like working standards across countries mean that another country can employ slaves and have uncompetitive costs due to free labor, causing an unfair environment for those same companies forming in countries without slave labor. That is much less likely within the same country. So it’s not necessarily the same to frame tariffs across states to be similar to tariffs on other countries. There are meaningful differences that make it harder to ensure similar standards across countries, which can make tariffs be meaningful. It helps to account for externalities inherent to lacking the protections mentioned in the first paragraph.
• hypeatei 2y ago
  > Aren’t tariffs just corporate taxes which are paid by big corps who import stuff built overseas? No, they're not "just" that. Those costs get passed onto the consumer in the form of higher prices. Corporations aren't going to eat the cost out of the goodness of their hearts. > At least when you incentivize stuff to get built here the money goes to union workers or at least stays within the US. If a widget from China costs $100 because of tariffs, then American companies who make the same widget have no reason to undercut that since they know consumers have no other options -- effectively raising the price floor. There are also issues with the "union workers get the money" because we're effectively stiffing the rest of the U.S. population in order to prop up a specific segment of the economy.
  • BytesAndGears 2y ago
    The American consumers do have other options — other American companies. Who are all held to a higher standard than foreign companies due to sharing a regulatory environment. So the price may go up, but it will eventually tend toward the natural floor, even if higher than before, taking into account the externalities that were ignored with foreign widgets such as poor working conditions and environmental disregard that happens in certain other countries.
    • hypeatei 2y ago
      > So the price may go up No, the prices will go up. As you said, the cost goes up due to better working conditions, wages, etc... > The American consumers do have other options — other American companies Yes, but all of American companies will never go below whatever the Chinese widget costs unless tariffs go away.
      • BytesAndGears 2y ago
        > American companies will never go below whatever the Chinese widget costs Why not? If there are 3 American companies with similar costs, would all of them just say “well, the price is the price?” Or would there eventually be one who realizes they can take more market share from the Chinese companies by undercutting them?