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Also, if most countries continue to trade freely with each other but there are import/export taxes on just the U.S., the U.S. becomes an unattractive place for
by beloch 2y ago
Also, if most countries continue to trade freely with each other but there are import/export taxes on just the U.S., the U.S. becomes an unattractive place for any products with international supply chains or that are amortized across an international market, both in terms of manufacture and sales.
There was a good post here the other day on bicycle manufacturing that pointed out that, while cheap, high volume, low-end products may indeed be practical to manufacture in the U.S. primarily for the U.S. market, it may not make sense to manufacture many high-end products behind trade barriers. Such products have low margins and need free access to the world market to make sense to build. Those that are currently manufactured outside the U.S. will likely stay outside the U.S. while those made in the U.S. may have to consider moving. Some will likely just no longer make sense to import into the U.S., leaving a void in that market, and some won't make sense to build at all.
Breaking the world market up into regions, as the U.S. is currently attempting, reduces the world's ability to make specialized, low-volume products.