4 ms·

The levels of cognitive dissonance here are insane. It should go without saying, the idea that tariffs will not be born by consumers and the idea that they will

The levels of cognitive dissonance here are insane. It should go without saying, the idea that tariffs will not be born by consumers and the idea that they will generate $500 billion dollars a year in income cannot both be true. (This also buries the the amount of deadweight loss to the economy that is not being calculated. A fair amount of consumer spending will turn into neither domestic purchases or tariffed imports.) I would accuse the administration in believing in magic, but this is somehow dumber than that. They are going around proudly saying that 2 + 2 = 5 and they will use this knowledge to infinite money glitch hack the economy.

toomuchtodo 2y ago
Wealthy people don't want to pay existing income taxes, let alone more income taxes (progressive income tax policy). Trump has pushed tariffs, and said other countries will pay for it. That is, of course, not how it works [1], but the people who believe this are...unsophisticated [2] [3] [4] and are voting their hate [5] and the uneducated view that POTUS controls price levels [6]. So they will cheer on tariffs that they will pay for, increasing a regressive tax on themselves and others who buy goods that will increase in price to cover this tax, while enabling the wealthy to not have to pay more income taxes. If it wasn't so terrible, I would compliment it as clever. “The forest was shrinking but the trees kept voting for the axe, for the axe was clever and convinced the trees that because his handle was made of wood he was one of them.” -― Turkish Proverb [1] Who Pays Tariffs? Americans Will Bear the Costs of the Next Trade War - https://taxfoundation.org/blog/who-pays-tariffs/ https://taxfoundation.org/blog/who-pays-tariffs/ [2] Searches of ‘who pays for tariffs’ sees massive spike after Trump’s announcement - https://finance.yahoo.com/news/searches-pays-tariffs-sees-massive-212544013.html https://finance.yahoo.com/news/searches-pays-tariffs-sees-ma... [3] "I Love the Poorly Educated" - https://www.youtube.com/watch?v=Vpdt7omPoa0 https://www.youtube.com/watch?v=Vpdt7omPoa0 [4] “I don’t care about you I just want your vote” - https://www.youtube.com/watch?v=jLJHHF3xY20 https://www.youtube.com/watch?v=jLJHHF3xY20 [5] “He’s not hurting the people he needs to be”: a Trump voter says the quiet part out loud - https://www.vox.com/policy-and-politics/2019/1/8/18173678/trump-shutdown-voter-florida https://www.vox.com/policy-and-politics/2019/1/8/18173678/tr... [6] Pew Research: What Trump supporters believe and expect - https://www.pewresearch.org/short-reads/2024/11/13/what-trump-supporters-believe-and-expect/ https://www.pewresearch.org/short-reads/2024/11/13/what-trum...
zahlman 2y ago
> It should go without saying, the idea that tariffs will not be born by consumers and the idea that they will generate $500 billion dollars a year in income cannot both be true. (Before I start: I am a Canadian supporter of the decidedly left-wing New Democratic Party. Responses attempting to dismiss me as a "Trump supporter" etc. will be ignored.) Sure they can, logically speaking. Trump's belief is that shelf prices will not increase; the money will come from the exporting country, in that they will end up with 20% less money for a given good (sold at the original price after applying a 25% tariff). Which is to say, not so much a "tax hike" as a savings on the same imported goods. I am, of course, simplifying by ignoring the domestic part of the supply chain after receiving the import. But there really is a coherent vision by which it could work. A higher shelf price means lower demand; this either must force down the price (unlikely insofar as the retailer can't afford it) or the supply. But the supplier's "supply" to the consumer is equivalent to "demand" from a wholesale source, etc. back to the originating country, for imported goods. The narrative that tariffs are universally and obviously bad in any amount everywhere is just too simple and convenient for me to take seriously. It doesn't square with the history of tariffs or with the fact of people repeatedly coming up with the idea (nor does it take into account that optimizing for the specific metrics negatively impacted by tariffs is necessarily globally optimal). And if you want to talk about deadweight loss, please make sure your view of tariffs is consistent with your view of a) minimum wage policy and b) rent control. I have found that many people do not, due to the interference of their political beliefs.
- ggm 2y ago
  Australia implemented protectionist barriers to trade for decades, and built a vibrant, functional domestic construction and manufacturing economy inside those walls. The free market decision delivered consumer goods at lower prices. It would be trivial to observe we've also lost almost all our domestic manufacturing capacity at scale, some of which existed for strategic defence reasons: we paid for Ford and GM to build cars here both to supply domestic vehicle markets and to insure we could make tanks and aircraft. When our price support structure went, ultimately so did Ford and GM. We still have a shipbuilding, and car assembly plants, and we are much more fully integrated into world free trade. It's a mixed blessing. Living standards have risen in general but also we're now in many ways mutually dependent, and in some aspects "weaker" Tariffs are contextual. Tariffs are strategic. Trump's economic advisers want a reset to trade balances to favour the USA, and are using tariffs to force change and I think it will make change happen but I am less sure it will be net beneficial to the US industry sectors involved. I am also sure it will come at significant consequences for every economy, and in that process make people reconsider their bilateral trade relationships. The US is already much less significant to Australia than it used to be, with the rise of Indian and Chinese consumers. The EU was a somewhat difficult market to trade with for us, and may now become considerably more attractive. We trade extensively with the middle east (live animals, grains) and I think will do more. I don't like the idea the current world trade regime is going to be upset for a single nation's benefit. That aside, I don't have a theoretical problem here, with the current world trade regime having imbalances which need correcting. But the shape of those corrections aren't as simple as "America wins" I see a lot of write ups which go to the distinction between zero-sum and mutual outcomes. I infer from this there is a strong belief Trump does not actually want any kind of mutual outcome, he only believes in "winners" and "losers" and believes there must be a "loser" and it won't be america as long as he can avoid it. Thats sad, because I think its a narrow view of what negotiation is. It's like he actually does not understand the "art of the deal" at all. Quel Surprise!

toomuchtodo 2y ago

Wealthy people don't want to pay existing income taxes, let alone more income taxes (progressive income tax policy). Trump has pushed tariffs, and said other countries will pay for it. That is, of course, not how it works [1], but the people who believe this are...unsophisticated [2] [3] [4] and are voting their hate [5] and the uneducated view that POTUS controls price levels [6]. So they will cheer on tariffs that they will pay for, increasing a regressive tax on themselves and others who buy goods that will increase in price to cover this tax, while enabling the wealthy to not have to pay more income taxes. If it wasn't so terrible, I would compliment it as clever. “The forest was shrinking but the trees kept voting for the axe, for the axe was clever and convinced the trees that because his handle was made of wood he was one of them.” -― Turkish Proverb [1] Who Pays Tariffs? Americans Will Bear the Costs of the Next Trade War - https://taxfoundation.org/blog/who-pays-tariffs/ https://taxfoundation.org/blog/who-pays-tariffs/ [2] Searches of ‘who pays for tariffs’ sees massive spike after Trump’s announcement - https://finance.yahoo.com/news/searches-pays-tariffs-sees-massive-212544013.html https://finance.yahoo.com/news/searches-pays-tariffs-sees-ma... [3] "I Love the Poorly Educated" - https://www.youtube.com/watch?v=Vpdt7omPoa0 https://www.youtube.com/watch?v=Vpdt7omPoa0 [4] “I don’t care about you I just want your vote” - https://www.youtube.com/watch?v=jLJHHF3xY20 https://www.youtube.com/watch?v=jLJHHF3xY20 [5] “He’s not hurting the people he needs to be”: a Trump voter says the quiet part out loud - https://www.vox.com/policy-and-politics/2019/1/8/18173678/trump-shutdown-voter-florida https://www.vox.com/policy-and-politics/2019/1/8/18173678/tr... [6] Pew Research: What Trump supporters believe and expect - https://www.pewresearch.org/short-reads/2024/11/13/what-trump-supporters-believe-and-expect/ https://www.pewresearch.org/short-reads/2024/11/13/what-trum...

zahlman 2y ago

> It should go without saying, the idea that tariffs will not be born by consumers and the idea that they will generate $500 billion dollars a year in income cannot both be true. (Before I start: I am a Canadian supporter of the decidedly left-wing New Democratic Party. Responses attempting to dismiss me as a "Trump supporter" etc. will be ignored.) Sure they can, logically speaking. Trump's belief is that shelf prices will not increase; the money will come from the exporting country, in that they will end up with 20% less money for a given good (sold at the original price after applying a 25% tariff). Which is to say, not so much a "tax hike" as a savings on the same imported goods. I am, of course, simplifying by ignoring the domestic part of the supply chain after receiving the import. But there really is a coherent vision by which it could work. A higher shelf price means lower demand; this either must force down the price (unlikely insofar as the retailer can't afford it) or the supply. But the supplier's "supply" to the consumer is equivalent to "demand" from a wholesale source, etc. back to the originating country, for imported goods. The narrative that tariffs are universally and obviously bad in any amount everywhere is just too simple and convenient for me to take seriously. It doesn't square with the history of tariffs or with the fact of people repeatedly coming up with the idea (nor does it take into account that optimizing for the specific metrics negatively impacted by tariffs is necessarily globally optimal). And if you want to talk about deadweight loss, please make sure your view of tariffs is consistent with your view of a) minimum wage policy and b) rent control. I have found that many people do not, due to the interference of their political beliefs.

ggm 2y ago
Australia implemented protectionist barriers to trade for decades, and built a vibrant, functional domestic construction and manufacturing economy inside those walls. The free market decision delivered consumer goods at lower prices. It would be trivial to observe we've also lost almost all our domestic manufacturing capacity at scale, some of which existed for strategic defence reasons: we paid for Ford and GM to build cars here both to supply domestic vehicle markets and to insure we could make tanks and aircraft. When our price support structure went, ultimately so did Ford and GM. We still have a shipbuilding, and car assembly plants, and we are much more fully integrated into world free trade. It's a mixed blessing. Living standards have risen in general but also we're now in many ways mutually dependent, and in some aspects "weaker" Tariffs are contextual. Tariffs are strategic. Trump's economic advisers want a reset to trade balances to favour the USA, and are using tariffs to force change and I think it will make change happen but I am less sure it will be net beneficial to the US industry sectors involved. I am also sure it will come at significant consequences for every economy, and in that process make people reconsider their bilateral trade relationships. The US is already much less significant to Australia than it used to be, with the rise of Indian and Chinese consumers. The EU was a somewhat difficult market to trade with for us, and may now become considerably more attractive. We trade extensively with the middle east (live animals, grains) and I think will do more. I don't like the idea the current world trade regime is going to be upset for a single nation's benefit. That aside, I don't have a theoretical problem here, with the current world trade regime having imbalances which need correcting. But the shape of those corrections aren't as simple as "America wins" I see a lot of write ups which go to the distinction between zero-sum and mutual outcomes. I infer from this there is a strong belief Trump does not actually want any kind of mutual outcome, he only believes in "winners" and "losers" and believes there must be a "loser" and it won't be america as long as he can avoid it. Thats sad, because I think its a narrow view of what negotiation is. It's like he actually does not understand the "art of the deal" at all. Quel Surprise!