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If they had bought American floodlights they had saved 255k in tarrifs. So if they had paid 200k for the floodlights they would have still been better of. One

If they had bought American floodlights they had saved 255k in tarrifs. So if they had paid 200k for the floodlights they would have still been better of. One could argue, that there might be no American Floodlight Company - well here is the incentive to build one. Secondly the money isn't lost, it goes to the state. Like a tax, but it is called differently. With this 255k more the state can now subsidise the local floodlight industry. If anything of the above comes to fruition... That's a different matter...

herbst 1y ago
> Secondly the money isn't lost, it goes to the state. Like a tax, but it is called differently. With this 255k more the state can now subsidise the local floodlight industry. Is that what is planned? The US has a lot of dept internationally I assumed the additional money goes into paying that back, or at least stabilize the dollar somehow
- lurkshark 1y ago
  During the last Trump trade war with China, there was about $28B paid out to American farmers as “Market Facilitation Payments”. So basically the taxes collected from our own tariffs went to subsidizing the impact of retaliatory tariffs. The whole thing is pretty dumb.
oatmeal_croc 1y ago
Floodlight companies don't appear overnight. I suspect they won't appear at all, given the instability of the tariffs and the fact that the next President (or even the current one) could wipe them off, rendering their shiny new Floodlight factory completely useless overnight. This extends to any industry. Tariffs need to be stable and updated with several months of advance notice - otherwise they don't serve their purpose.
- badestrand 1y ago
  It still is a very possible effect. Yes, less chaos and more predictability would be better obviously but the theoretical foundation is somewhat solid.
worik 1y ago
> Like a tax, It is a tax
- badestrand 1y ago
  A tax on foreign labor, to be exact. (Not foreign products or materials per se).
  - atwrk 1y ago
    Actually it's an import tax - the importer pays it, not the foreign worker.
    - badestrand 1y ago
      Yes, true of course. But I meant that if you take an example of tshirt production that gets sold in the US, with fabric that comes from Bangladesh, one producer in Vietnam, one in the US. The final price consists of materials, labor, shipping. Both effectively have materials and shipping tariffed and for the Vietnam company additionally the labor is tariffed. So the only difference is the application of the tariff on the labor for the Vietnam company.
badestrand 1y ago
> Secondly the money isn't lost, it goes to the state. Like a tax, but it is called differently. With this 255k more the state can now subsidise the local floodlight industry. Alternatively the taxes can be lowered so that overall the American consumers don't lose buying power (imports get more expensive but people also have more money to spend).
atwrk 1y ago
Thanks to the chicken tax we already know how this will develop: The US floodlight company will sell those US-made lights these lights for ~400k (so at the margin of market price plus tariffs), and no one outside the US will want to buy them. This is literally what already happened with the US car industry.
- glimshe 1y ago
  There are many companies all over the world focused on local markets. The car industry is strategic, but I wouldn't mind buying a floodlight from a company that doesn't export anything.
  - ahstilde 1y ago
    So you want a worse floodlight at a higher price because of government protection?
    - glimshe 1y ago
      If it employs an American and helps recreate our middle class... Yes I do. First they came for the floodlight maker's job. Next they will come for yours.
      - lossolo 1y ago
        There is no unemployment problem. Producing floodlight is not high paying job. If things become more expensive, more people will fall out of the middle class because they will no longer be able to afford what they previously could.
        glimshe 1y ago
        There is an enormous problem with sub-employment. Scores of Americans "employed" in activities such as Uber/Lyft driving, food delivery and quasi-prostitution (OnlyFans and adjacent). Floodlight making would be a huge step up for Americans leaving small towns for terrible jobs in big cities. Check the problem with drug addiction in small and medium cities.
nojvek 1y ago
> state can now subsidise local floodlight industry. Ha! State wants to cut taxes for corporations and billionaires. That’s where the money is most likely going to go. Inflation go brrrr!
thisisit 1y ago
That is not even remotely correct. The American Floodlight Company would sell the floodlights for slightly below the 392k - the total amount these guys paid. Something like 350k and tell the consumers they just saved "42k". Because the alternative is? Import it and pay huge tariffs. This is what happened last time with washing machines. The protectionism also means American Floodlight Company no longer needs to innovate. Because they can keep producing the same lights over and over again. What are people going to do? Look for innovative floodlights overseas and pay huge tariffs? It also means American Floodlight Company products cannot be exported. It is costlier and not innovative. Japanese, Chinese, Koreans brands are going to leave them behind. In the meantime, American Floodlight Company is a business, not a charity. They will find loopholes like get cheap parts -- this will be easier as world moves on to newer, more efficient lights, so that overall input costs are low - despite the tariffs. Then assemble it in US and claim it to be "Made in USA". Win, Win for the company while the consumers can take a hike.
- number6 1y ago
  Yes that's the most likely outcome, but OP asked for the benefits - and I guess my explanation is the naïve thinking that lead to the tarrifs in the first place

herbst 1y ago

> Secondly the money isn't lost, it goes to the state. Like a tax, but it is called differently. With this 255k more the state can now subsidise the local floodlight industry. Is that what is planned? The US has a lot of dept internationally I assumed the additional money goes into paying that back, or at least stabilize the dollar somehow

lurkshark 1y ago
During the last Trump trade war with China, there was about $28B paid out to American farmers as “Market Facilitation Payments”. So basically the taxes collected from our own tariffs went to subsidizing the impact of retaliatory tariffs. The whole thing is pretty dumb.

oatmeal_croc 1y ago

Floodlight companies don't appear overnight. I suspect they won't appear at all, given the instability of the tariffs and the fact that the next President (or even the current one) could wipe them off, rendering their shiny new Floodlight factory completely useless overnight. This extends to any industry. Tariffs need to be stable and updated with several months of advance notice - otherwise they don't serve their purpose.

badestrand 1y ago
It still is a very possible effect. Yes, less chaos and more predictability would be better obviously but the theoretical foundation is somewhat solid.

worik 1y ago

> Like a tax, It is a tax

badestrand 1y ago
A tax on foreign labor, to be exact. (Not foreign products or materials per se).
- atwrk 1y ago
  Actually it's an import tax - the importer pays it, not the foreign worker.
  - badestrand 1y ago
    Yes, true of course. But I meant that if you take an example of tshirt production that gets sold in the US, with fabric that comes from Bangladesh, one producer in Vietnam, one in the US. The final price consists of materials, labor, shipping. Both effectively have materials and shipping tariffed and for the Vietnam company additionally the labor is tariffed. So the only difference is the application of the tariff on the labor for the Vietnam company.

badestrand 1y ago

> Secondly the money isn't lost, it goes to the state. Like a tax, but it is called differently. With this 255k more the state can now subsidise the local floodlight industry. Alternatively the taxes can be lowered so that overall the American consumers don't lose buying power (imports get more expensive but people also have more money to spend).

atwrk 1y ago

Thanks to the chicken tax we already know how this will develop: The US floodlight company will sell those US-made lights these lights for ~400k (so at the margin of market price plus tariffs), and no one outside the US will want to buy them. This is literally what already happened with the US car industry.

glimshe 1y ago
There are many companies all over the world focused on local markets. The car industry is strategic, but I wouldn't mind buying a floodlight from a company that doesn't export anything.
- ahstilde 1y ago
  So you want a worse floodlight at a higher price because of government protection?
  - glimshe 1y ago
    If it employs an American and helps recreate our middle class... Yes I do. First they came for the floodlight maker's job. Next they will come for yours.
    - lossolo 1y ago
      There is no unemployment problem. Producing floodlight is not high paying job. If things become more expensive, more people will fall out of the middle class because they will no longer be able to afford what they previously could.
      - glimshe 1y ago
        There is an enormous problem with sub-employment. Scores of Americans "employed" in activities such as Uber/Lyft driving, food delivery and quasi-prostitution (OnlyFans and adjacent). Floodlight making would be a huge step up for Americans leaving small towns for terrible jobs in big cities. Check the problem with drug addiction in small and medium cities.

nojvek 1y ago

> state can now subsidise local floodlight industry. Ha! State wants to cut taxes for corporations and billionaires. That’s where the money is most likely going to go. Inflation go brrrr!

thisisit 1y ago

That is not even remotely correct. The American Floodlight Company would sell the floodlights for slightly below the 392k - the total amount these guys paid. Something like 350k and tell the consumers they just saved "42k". Because the alternative is? Import it and pay huge tariffs. This is what happened last time with washing machines. The protectionism also means American Floodlight Company no longer needs to innovate. Because they can keep producing the same lights over and over again. What are people going to do? Look for innovative floodlights overseas and pay huge tariffs? It also means American Floodlight Company products cannot be exported. It is costlier and not innovative. Japanese, Chinese, Koreans brands are going to leave them behind. In the meantime, American Floodlight Company is a business, not a charity. They will find loopholes like get cheap parts -- this will be easier as world moves on to newer, more efficient lights, so that overall input costs are low - despite the tariffs. Then assemble it in US and claim it to be "Made in USA". Win, Win for the company while the consumers can take a hike.

number6 1y ago
Yes that's the most likely outcome, but OP asked for the benefits - and I guess my explanation is the naïve thinking that lead to the tarrifs in the first place