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> The problem is that factories take years to build Nobody's even building them right now. CAPEX and industrial investment have declined in recent months. (!!

> The problem is that factories take years to build Nobody's even building them right now. CAPEX and industrial investment have declined in recent months. (!!) They may even drop further. So it seems that if the aim is to revitalize America's industrial base, the present strategy isn't working, but is having an opposite effect.

threeseed 2y ago
You need an educated, skilled and plentiful workforce for global manufacturing. US has taken concrete steps in the last 100 days to reduce all three.
- Moto7451 2y ago
  The strategy of the US has been Hegemony. Friendly foreign partners were intended to take over industries we did not want in our own backyards for political, diplomatic, economic, or environmental reasons. For a stint in college I was an International Relations major and this was 100 series education. At a basic level this is discussed as the “Pollution Haven Hypothesis.” https://en.m.wikipedia.org/wiki/Pollution_haven_hypothesis https://en.m.wikipedia.org/wiki/Pollution_haven_hypothesis A political/diplomatic example is rebuilding the Japanese Steel industry after WWII so they could regain self sufficiency. Until we decide to shoot ourselves in the foot hard enough we’ve had a consistent trading partner in high quality steel ever since. The current “strategy” is painful because it has the weight of the past 60-70 years working against it.
  - SpicyLemonZest 2y ago
    I dunno. This reads to me like an attempt to retroactively justify the effects of US policies that were aimed at a different purpose. I don't think I've ever seen an American politician say that they'd prefer for industry X or Y to be located in a different country.
    - vel0city 2y ago
      Just going to ignore the Marshall Plan and Reverse Course policies then I guess? https://en.wikipedia.org/wiki/Marshall_Plan https://en.wikipedia.org/wiki/Marshall_Plan https://en.wikipedia.org/wiki/Reverse_Course https://en.wikipedia.org/wiki/Reverse_Course This isn't some retroactive attempt to justify something. This was the actual policy at the time.
      - SpicyLemonZest 2y ago
        I don't think either of these policies intended or caused other countries to "take over industries we did not want in our own backyards". In the 50s and 60s the US still ran consistent trade surpluses.
- tmountain 2y ago
  Factories also require global supply chains. Not the United States strong point at the moment...
badloginagain 2y ago
Which is funny because US industrial investment was on a tear pre-tariff as companies near/on-shored at historic rates. Not only were tariff's not needed, they've effectively shut down their intended goal.
- sorcerer-mar 2y ago
  This chart is a pretty astounding look at how successful Bidenomics was at achieving this and how catastrophic Trumponomics is already turning out to be: https://fred.stlouisfed.org/series/PRMFGCON https://fred.stlouisfed.org/series/PRMFGCON
  - potato3732842 2y ago
    Credit to prior on-shoring should go to Covid 19 and the Chinese government's heavy handed response to it, not any US policy or administration. Talk to anyone in industry and they'll say "we on/near shored because Covid supply chain problems taught us a lesson" or something along those lines. Those investments were just starting to bear fruit in the past few years. Edit: And before anyone tries to put words in my mouth, this is neither an endorsement of "Trumpenomics" nor a dispute of the prior commenter's statement about them.
    - sorcerer-mar 2y ago
      The difference between on- and near-shoring is pretty important, and I'm going to bet the trillion dollars in incentives played a far, far bigger role than the delta in people's resilience estimations between putting a factory in Mexico vs the United States. Credit should go to all factors, but sorry it's foolish to think orchestration of a trillion dollars into exactly these sectors wouldn't play a huge role.
      - potato3732842 2y ago
        >The difference between on- and near-shoring is pretty important, Of course. I don't think many saw coming that we wouldn't be on friendly trade terms with Mexico and Canada. > and I'm going to bet the trillion dollars in incentives played a far, far bigger role than the delta in people's resilience estimations Which have you seen companies respond more swiftly to, opportunities to make money, or disruptions in their existing ways of making money? Which gets the CEO on the phone faster, a potential business deal or a prod outage? Just about everyone experienced the latter during Covid. "Yeah we'd love to do all the electrical for your covid construction boom fueled McMansion development but switchgear is back ordered 18mo, sorry", and so on and so on across many industries. And they're all real salty about it. I'm sure the incentives added fuel to the fire, but the way the Chinese economy stayed disrupted for longer really pained a lot of people in the US who depend on stuff from there to make money here.
parsimo2010 2y ago
> if the aim is to revitalize America's industrial base, the present strategy isn't working The issue is that the aim clearly isn’t to revitalize the industrial base. If it were, then the tariffs wouldn’t be removed after negotiating with other countries. Since other countries can make deals to reduce the tariffs on their products, then it’s clear that the aim isn’t to get Americans to build things at home. The tariffs are clearly some kind of brinkmanship game to pressure other countries into making concessions.
- neogodless 2y ago
  Don't forget that the 10% for everyone tariffs were not paused, nor can they be negotiated away.
  - parsimo2010 2y ago
    > 10% for everyone tariffs were not paused, nor can they be negotiated away But "everyone" doesn't mean everyone because everything on this list is exempt from the global 10% tariff and recriprocal tariffs (https://www.whitehouse.gov/wp-content/uploads/2025/04/Annex-II.pdf https://www.whitehouse.gov/wp-content/uploads/2025/04/Annex-...). Categories have been added to the list after influential people called the President. So even the 10% for "everyone" tariff can be negotiated away if you give the President something he values.
    - thayne 2y ago
      Which suggests it isn't just a way to get foreign countries to negotiate, but also a way to get domestic companies to negotiate with him, possibly in a way to increase his personal power.
      - deleted 2y ago
        [deleted]
- StackRanker3000 2y ago
  I think the aim of the tariffs changes depending on President Trump’s mood, what the market is doing, what the press is saying, and who he spoke to last.
ty6853 2y ago
OF course capex declines when you tarriff. Part of Trump's genius tarriff plan was closing trade deficits. Except trade deficit is just mostly a measure of how much countries choose to park the returns on their goods/services in your own country as investment in capex, domestic investments, etc. It is the foreigner choosing not to take the dollar or exchanged goods back to their own country, but to invest it in your own country. You literally kill capex by killing the trade deficit.
- marcosdumay 2y ago
  Kinda, but domestic capex is overwhelmingly more important than foreign investment in almost every country, and the US is absolutely included on that set. So, on practice, you won't find a correlation here.
fuzzfactor 2y ago
A lot of businesses now have to face that to survive, they need to increase their market share or profit margin by double-digit percentages when they probably don't have double-digit numbers there to begin with :\ And double-digit increases are what they have been working toward the whole time, they know how to do it, that's how they have managed to get by, even though they know it will takes years. These are great business operators, they know they'll make it if they persevere, they just don't know how many years. And these were the businesses that were shrewdly operating successfully in the USA in difficult markets with slim margins, even if they were leaning to any extent on cheap foreign materials, labor, or even weighted more toward robust domestic commerce in general. Prevailing in situations that "average" businessmen aren't quite up to. How do you think the less-skilled operators are going to feel? They know who they are. Lots of times their businesses are totally dependent on the majority of Americans overall being "richer" than most. And in less than 100 days really, that's been brought into question more times than in any other previous decade. With things like over-taxing and currency exchange taking their toll at the same time commerce itself as a source of prosperity is receding, this is going to make them some of them the most nervous of all. Trump has always been foolish with money, after his first term the US can no longer afford lots of things that were affordable under all previous presidents, you can't make this up. When a recognized business-bozo-in-chief can remotely do more percentage damage in one day than a business owner can make up for in one year, might as well give up now, or at least take a sabbatical. Trump can't last forever, and anybody who replaces him may not be any wiser or less misguided, but at least would be more stable & trustworthy.
- ActorNightly 2y ago
  Unfortunately Trump is going to stay a 3d term, so more damage is gonna be done.
  - nyantaro1 2y ago
    I am not an American. I understand this would be unconstitutional, right? Or is there an actual path to allow a third term for a president?
AnimalMuppet 2y ago
If you believe certain business cycle theories, the way an economic downturn starts is when businesses no longer see the need for additional new capacity. So there's declining CAPEX. Then the 40% of the economy that is CAPEX-related takes a downturn. Even though the 60% that is consumer goods is still for the moment going at full capacity, the CAPEX-related part suffers layoffs. That in turn affects the consumer spending part of the economy. So if CAPEX is declining, the downturn has already started. (I mean, I guess the article's headline already told us that...)
dehrmann 2y ago
There's a chance the tariffs will be rejected by the Supreme Court within a year, a chance something political happens within the next two years (senators and representatives will turn on Trump as soon as he becomes a liability in the next election), and new management will be here in four years. Too much is in flux to make an expensive decision that won't see value for years. There'd need to be grants to jump start construction.
- exe34 2y ago
  That might be a good time for him to move to whatever his Reichstag fire will be and make sure he stays on. The argument could be that this sort of long term development requires a firm and constant leadership for a long time.
krferriter 2y ago
We are both suppressing international trade of consumer goods and making it harder and more expensive to build out the infrastructure to build consumer goods in the US.

threeseed 2y ago

You need an educated, skilled and plentiful workforce for global manufacturing. US has taken concrete steps in the last 100 days to reduce all three.

Moto7451 2y ago
The strategy of the US has been Hegemony. Friendly foreign partners were intended to take over industries we did not want in our own backyards for political, diplomatic, economic, or environmental reasons. For a stint in college I was an International Relations major and this was 100 series education. At a basic level this is discussed as the “Pollution Haven Hypothesis.” https://en.m.wikipedia.org/wiki/Pollution_haven_hypothesis https://en.m.wikipedia.org/wiki/Pollution_haven_hypothesis A political/diplomatic example is rebuilding the Japanese Steel industry after WWII so they could regain self sufficiency. Until we decide to shoot ourselves in the foot hard enough we’ve had a consistent trading partner in high quality steel ever since. The current “strategy” is painful because it has the weight of the past 60-70 years working against it.
- SpicyLemonZest 2y ago
  I dunno. This reads to me like an attempt to retroactively justify the effects of US policies that were aimed at a different purpose. I don't think I've ever seen an American politician say that they'd prefer for industry X or Y to be located in a different country.
  - vel0city 2y ago
    Just going to ignore the Marshall Plan and Reverse Course policies then I guess? https://en.wikipedia.org/wiki/Marshall_Plan https://en.wikipedia.org/wiki/Marshall_Plan https://en.wikipedia.org/wiki/Reverse_Course https://en.wikipedia.org/wiki/Reverse_Course This isn't some retroactive attempt to justify something. This was the actual policy at the time.
    - SpicyLemonZest 2y ago
      I don't think either of these policies intended or caused other countries to "take over industries we did not want in our own backyards". In the 50s and 60s the US still ran consistent trade surpluses.
tmountain 2y ago
Factories also require global supply chains. Not the United States strong point at the moment...

badloginagain 2y ago

Which is funny because US industrial investment was on a tear pre-tariff as companies near/on-shored at historic rates. Not only were tariff's not needed, they've effectively shut down their intended goal.

sorcerer-mar 2y ago
This chart is a pretty astounding look at how successful Bidenomics was at achieving this and how catastrophic Trumponomics is already turning out to be: https://fred.stlouisfed.org/series/PRMFGCON https://fred.stlouisfed.org/series/PRMFGCON
- potato3732842 2y ago
  Credit to prior on-shoring should go to Covid 19 and the Chinese government's heavy handed response to it, not any US policy or administration. Talk to anyone in industry and they'll say "we on/near shored because Covid supply chain problems taught us a lesson" or something along those lines. Those investments were just starting to bear fruit in the past few years. Edit: And before anyone tries to put words in my mouth, this is neither an endorsement of "Trumpenomics" nor a dispute of the prior commenter's statement about them.
  - sorcerer-mar 2y ago
    The difference between on- and near-shoring is pretty important, and I'm going to bet the trillion dollars in incentives played a far, far bigger role than the delta in people's resilience estimations between putting a factory in Mexico vs the United States. Credit should go to all factors, but sorry it's foolish to think orchestration of a trillion dollars into exactly these sectors wouldn't play a huge role.
    - potato3732842 2y ago
      >The difference between on- and near-shoring is pretty important, Of course. I don't think many saw coming that we wouldn't be on friendly trade terms with Mexico and Canada. > and I'm going to bet the trillion dollars in incentives played a far, far bigger role than the delta in people's resilience estimations Which have you seen companies respond more swiftly to, opportunities to make money, or disruptions in their existing ways of making money? Which gets the CEO on the phone faster, a potential business deal or a prod outage? Just about everyone experienced the latter during Covid. "Yeah we'd love to do all the electrical for your covid construction boom fueled McMansion development but switchgear is back ordered 18mo, sorry", and so on and so on across many industries. And they're all real salty about it. I'm sure the incentives added fuel to the fire, but the way the Chinese economy stayed disrupted for longer really pained a lot of people in the US who depend on stuff from there to make money here.

parsimo2010 2y ago

> if the aim is to revitalize America's industrial base, the present strategy isn't working The issue is that the aim clearly isn’t to revitalize the industrial base. If it were, then the tariffs wouldn’t be removed after negotiating with other countries. Since other countries can make deals to reduce the tariffs on their products, then it’s clear that the aim isn’t to get Americans to build things at home. The tariffs are clearly some kind of brinkmanship game to pressure other countries into making concessions.

neogodless 2y ago
Don't forget that the 10% for everyone tariffs were not paused, nor can they be negotiated away.
- parsimo2010 2y ago
  > 10% for everyone tariffs were not paused, nor can they be negotiated away But "everyone" doesn't mean everyone because everything on this list is exempt from the global 10% tariff and recriprocal tariffs (https://www.whitehouse.gov/wp-content/uploads/2025/04/Annex-II.pdf https://www.whitehouse.gov/wp-content/uploads/2025/04/Annex-...). Categories have been added to the list after influential people called the President. So even the 10% for "everyone" tariff can be negotiated away if you give the President something he values.
  - thayne 2y ago
    Which suggests it isn't just a way to get foreign countries to negotiate, but also a way to get domestic companies to negotiate with him, possibly in a way to increase his personal power.
    - deleted 2y ago
      [deleted]
StackRanker3000 2y ago
I think the aim of the tariffs changes depending on President Trump’s mood, what the market is doing, what the press is saying, and who he spoke to last.

ty6853 2y ago

OF course capex declines when you tarriff. Part of Trump's genius tarriff plan was closing trade deficits. Except trade deficit is just mostly a measure of how much countries choose to park the returns on their goods/services in your own country as investment in capex, domestic investments, etc. It is the foreigner choosing not to take the dollar or exchanged goods back to their own country, but to invest it in your own country. You literally kill capex by killing the trade deficit.

marcosdumay 2y ago
Kinda, but domestic capex is overwhelmingly more important than foreign investment in almost every country, and the US is absolutely included on that set. So, on practice, you won't find a correlation here.

fuzzfactor 2y ago

A lot of businesses now have to face that to survive, they need to increase their market share or profit margin by double-digit percentages when they probably don't have double-digit numbers there to begin with :\ And double-digit increases are what they have been working toward the whole time, they know how to do it, that's how they have managed to get by, even though they know it will takes years. These are great business operators, they know they'll make it if they persevere, they just don't know how many years. And these were the businesses that were shrewdly operating successfully in the USA in difficult markets with slim margins, even if they were leaning to any extent on cheap foreign materials, labor, or even weighted more toward robust domestic commerce in general. Prevailing in situations that "average" businessmen aren't quite up to. How do you think the less-skilled operators are going to feel? They know who they are. Lots of times their businesses are totally dependent on the majority of Americans overall being "richer" than most. And in less than 100 days really, that's been brought into question more times than in any other previous decade. With things like over-taxing and currency exchange taking their toll at the same time commerce itself as a source of prosperity is receding, this is going to make them some of them the most nervous of all. Trump has always been foolish with money, after his first term the US can no longer afford lots of things that were affordable under all previous presidents, you can't make this up. When a recognized business-bozo-in-chief can remotely do more percentage damage in one day than a business owner can make up for in one year, might as well give up now, or at least take a sabbatical. Trump can't last forever, and anybody who replaces him may not be any wiser or less misguided, but at least would be more stable & trustworthy.

ActorNightly 2y ago
Unfortunately Trump is going to stay a 3d term, so more damage is gonna be done.
- nyantaro1 2y ago
  I am not an American. I understand this would be unconstitutional, right? Or is there an actual path to allow a third term for a president?

AnimalMuppet 2y ago

If you believe certain business cycle theories, the way an economic downturn starts is when businesses no longer see the need for additional new capacity. So there's declining CAPEX. Then the 40% of the economy that is CAPEX-related takes a downturn. Even though the 60% that is consumer goods is still for the moment going at full capacity, the CAPEX-related part suffers layoffs. That in turn affects the consumer spending part of the economy. So if CAPEX is declining, the downturn has already started. (I mean, I guess the article's headline already told us that...)

dehrmann 2y ago

There's a chance the tariffs will be rejected by the Supreme Court within a year, a chance something political happens within the next two years (senators and representatives will turn on Trump as soon as he becomes a liability in the next election), and new management will be here in four years. Too much is in flux to make an expensive decision that won't see value for years. There'd need to be grants to jump start construction.

exe34 2y ago
That might be a good time for him to move to whatever his Reichstag fire will be and make sure he stays on. The argument could be that this sort of long term development requires a firm and constant leadership for a long time.

krferriter 2y ago

We are both suppressing international trade of consumer goods and making it harder and more expensive to build out the infrastructure to build consumer goods in the US.