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Tariffs in American History
- coliveira 1y agoFunny how, when a policy that was considered completely crazy a few years ago is introduced, there will be an army of people trying to find every justification for that policy to become normalized.
- aqme28 1y agoA lot of people derive their politics not from principles, but from association. If my Team is for it and opponents are against it, then I am for it.
- cycomanic 1y agoYes and I believe this one of the most problematic aspects of representative democracies. Policies are often complex so hardly anyone has the time to educate themselves on all policies of a party, instead many revert to the other extreme and simply cheer for their team. An interesting concept to alleviate this problem has been pioneered in Melbourne local politics is citizen councils.
- XorNot 1y agoI only ever hear this used by people who insist that bad faith interlocutors just need to be given a 10th chance to make their point. No one has infinite time or attention.
- LeonB 1y agoMy Google skills are failing me here — can you provide a link, and/or some more search terms, regarding these citizen councils? Is it specific to Melbourne municipal council or other Victorian LGA’s?
- cycomanic 1y agoThe correct term seems to be citizen assemblies (apologies). Here's a link: https://www.newdemocracy.com.au/independent-citizens-assemblies/ https://www.newdemocracy.com.au/independent-citizens-assembl...
- anonfordays 1y agoFunny how, both sides read this and think it's the other side you're referencing.
- smitty1e 1y agoTFA is merely an historical overview, not an argument for or against. The conclusion is: "We'll see". One might argue that the sight in question tends toward the Trumpian side of things in general, I suppose.
- 0xB31B1B 1y ago[flagged]
- smitty1e 1y agoWhat does that have to do with the article, please? I should have thought this site a little better than "guilt by association".
- watwut 1y ago[flagged]
- smitty1e 1y agoWhere? Was there anything substantial on offer, or are your replies so many crude fragments from the Argument Clinic?
- sundaeofshock 1y agoMaybe lie is too strong a term. Having said that, the article suggests that US cars don’t sell in Europe due to tariffs, ignoring the fact that vehicles like the Ford F-150 just don’t work in the small streets of most European cities.
- watwut 1y agoThe whole German cars point is based on "VAT is an import tax" lie. That is pure lie, VAT is exactly the same for German made cars. It is sales tax. I am using the word "lie" rather then "mistake" because it is well know and easy to double check. No way they do not know.
- roenxi 1y agoPolicies don't just appear from the aether; it takes quite a big push to get a government to move in one direction or another. They are sedentary beasts by nature. So it is a safe bet that every implemented policy has a number of people who quite like it, but the community that likes it may well be considered fringe up until they prove to have the numbers and get their preferred policy implemented. Every flavour of economics enjoys some level of widespread support, there are still a bunch of people who profess a commitment to Marxism. Nobody listens to them (hurrah!) but they're still there. If we had Marxists in charge their articles would probably get a lot more traction though because people want to know what is going to happen next. Ditto things like the gold standard, fiat currency, ultra-low taxes, ultra-high taxes, globalism and economic independence strategies. TLDR; there is probably a strong selection bias here.
- throwawaythekey 1y agoYou also have the crazies that initially advocated for the policy now reversing their positions.
- crossroadsguy 1y agoAs someone from a developing economy whenever I see a new .edu domain or .ac.uk domain I immediately try to find the institute’s establishment date. I rarely find anything above 1800s from these two countries- US, UK. I often wonder how much this aspect of a certain country contributes to its (sometimes meteoric) growth and how my own country was actually at the pinnacle once and how it coincided with having literally the best of the educational institutions of that time. But that was past — today a 20 year old institute is considered “old” here. (Though I wonder how much they contribute? 30-40%? Or more? How does one find this out?) Anyway, I am sure there are other factors like colonialism and what not. But even if you manage to rob someone else and then by the end of next week your money is gone in the various waterholes of your neighbourhood then you are right where you started ready to rob again until you can’t rob anymore. Are there other, from past, “robber” nations that squandered their loot in watering holes? I wonder how “meteoric” the decline would be if those same academic institutes are undermined and are stifled, the ones that contributed to the rise. PS. When I was applying to unis in mainland Europe (because US/UK was too costly) any place below at least a hundred year old was “too nuvo” for my academic taste ;-)
- mustache_kimono 1y ago> When I was applying to unis in mainland Europe (because US/UK was too costly) any place below at least a hundred year old was “too nuvo” for my academic taste ;-) Hillsdale is a college founded expressly to be a conservative alternative to the Ivies/older liberal arts schools. And its graduates have been very influential in the recent American conservative movement.
- crossroadsguy 1y agoI mentioned that part about my own country. I think it was not clear. I’ll try to edit. (Edit: it is clear)
- 0xB31B1B 1y agoHillsdale college is a fundamentalist Christian college. “Bible is the literal word of god” stuff. Many people there believe the world is 6000 years old and evolution didn’t happen.
- mmastrac 1y agoWhat seems to be lost in these discussions is how the American system rides on global respect for American IP, and that this respect for IP is part of the whole global trade system. With global trade falling apart, this respect for IP is in grave danger. Robust IP protections contributed significantly to America's wealth. The short-sighted focus on tariffs and re-shoring manufacturing completely neglects the whole balance and will damage America's position long-term.
- coliveira 1y ago> Robust IP protections contributed significantly to America's wealth. Quite the opposite, the US didn't enforce IP protections during the first few years of industrialization, exactly because they were stealing IP from England.
- ajross 1y agoThis is a retcon attempt. While sure, tariffs are just a tax like any other and can be applied to lots of different policy aims, and don't have to be the end of the world... None of these arguments were presented in a reasonable way, with numbers, ahead of a policy decision that made a considered attempt to find an optimal balance. No, we elected an administration that had been shouting "Tariffs!" during the campaign, then enacted "Tariffs!" once in office, then engaged in a quite frankly pathetic flurry of increases/decreases/suspensions/delays to try to fix the critical problems being introduced by the "Tariffs!". Most of which have been to other nations' benefit, even. It's a bit much to look back after three months of this madness and try to pretend how reasonable it was all along. We're still in the madness (Q2/Q3 numbers haven't landed yet to show actual effects, it's going to be a rocky year, folks).
- matwood 1y agoThe administration still routinely presents VAT as a tariff. To think there is any real policy thought behind the actions is akin to looking for meaning in the clouds.
- nkozyra 1y ago"Clouds are simply a negotiating tactic"
- trelane 1y agoTo some extent, they seem interchangeable. For instance, any time System76 is brought up for Europeans, VAT is immediately mentioned, along with why they don't have a European distribution center. Why would opening a European distribution center be relevant if you have to pay the same VAT either way? A few examples: https://ubuntuforums.org/showthread.php?t=2204089 https://ubuntuforums.org/showthread.php?t=2204089 https://www.reddit.com/r/System76/comments/1c9djrj/taxes_on_shipping_to_europe/ https://www.reddit.com/r/System76/comments/1c9djrj/taxes_on_...
- matwood 1y agoThe VAT is akin to a sales tax. It's paid regardless of where the item is manufactured or distributed from (and mostly regardless of the item). The US typically applies between 5-10% sales tax on most items. I have no idea why someone from System76 would think it's relevant to have an EU distribution center, but it wouldn't change the VAT. BTW, it's not just the EU that wants you to pay the sales tax when bringing items across the border, but the US also. It just so happens that it's rarely if ever enforced. EDIT I should add that the key difference of the VAT and tariff is that VAT is not made to advantage one product over another. It's simply a sales tax on nearly all products, just like the US sales taxes.
- mustache_kimono 1y agoThis tariff discussion is insipid. The question is not whether there are some historic antecedents for tariffs. Of course there may be, like there are historical antecedents for slavery, but the question is what is the current econometric justification. Some claims are just out and out misleading, like: > One of the provisions agreed to by the U.S. in the early GATT negotiations following World War II was differential tariffs: the U.S. lowered its tariffs more than its trading partners did. Again, the purpose of this was to speed the economic rebuilding of allies and former enemies who had suffered devastation during the war. Perhaps that was a purpose of those tariffs, but this ignores the more general purpose of US policy which was, at the time, to reduce trade barriers, by more closely integrating all these economies (see European Coal and Steel Community), and creating a customs union (see the Paris and Rome Treaties), all in service of preventing another world war. > The U.S., for instance, has a 2.5 percent tariff on cars imported from Germany, while Germany has a ten percent tariff on American cars. Hard to believe, in the age of Trump, but tariff rates are generally negotiated for provisions, as part of a broader trade agreement. TTIP, a new EU-US agreement, was dropped by the US without a deal in 2016. Guess why. > As a result, while the logos of Mercedes-Benz, BMW, and Volkswagen are seen all over American roads, those of Ford and General Motors are a rare sight in Germany. MB and BMW have a long history making cars, longer in many cases than the American companies. That is -- this is a mature industry, and, in general, Ford and GM are not regarded as making cars of the same quality both in the US or in Germany. So -- the reason you don't see many Cadillacs in Germany is because MB and BMW and Porsche make a better alternative, and the consumers know it. Japan for instance has a 0% tariff rate on US cars and the Japanese still don't buy them.
- ninalanyon 1y ago> Ford and General Motors are a rare sight in Germany. It's not even true that Ford is a rare sight. Ford outsells Toyota in Germany, employs 28 000 people in Germany, and has been incorporated there since 1925. US Fords are of course a rare sight but that has nothing to do with tariffs, it is simply that most buyers don't want them.
- orwin 1y agoI disagree for Ford. Fords are well regarded in the EU, probably the US brand who sold the most car. But they do mostly small, efficient cars here, not the monsters they sell in the US.
- throw0101d 1y agoPerhaps worth noting that there are situations that tariffs can be considered a good idea: * https://www.noahpinion.blog/p/when-are-tariffs-good https://www.noahpinion.blog/p/when-are-tariffs-good It's just that generally speaking, most of why they're being implemented by the US now are not valid.
- dylan604 1y agoThere's a difference of applying tariffs to imported goods that are cheaper than domestically produced goods so that their prices are not sold at drastically cheaper prices then making it impossible for imports to compete.
- hammock 1y agoIt’s funny how most of what I read these days boils down to, “it could be a good idea, but when trump does it it’s bad”
- ascagnel_ 1y agoWhat about "it could be a good idea, but when it's done haphazardly it's bad"? Both sentences describe the situation accurately.
- bruce511 1y agoIdeas are one thing, execution is another. Based on bad execution it's possible for the cure to be worse than the disease. Tarifs are a powerful tool to product specific industries. When implemented properly (focused on specific industries) they can change behavior, support local jobs, increase national objectives. Applied consistently, in a predictable way, across decades, they allow rational players to predict the future, and invest accordingly. If I can see that washing machines have a floor price I can invest in a washing machine factory. When implemented broadly (like across all industries, globally, at random percentages) they achieve none of the above. All they achieve are higher prices. Tariffs on coffee serve no domestic goals since the US has no coffee industry. The problem is not that Trumps ideas are bad. Voters love his policies. But he's lazy. It's easiest to just slap "10% on the world" than say 10% on lumber to protect the local lumber industry. Worse, there's no stability. The here-today-gone-tomorrow approach defeats the point. I'm not investing in a new lumber mill if those 50% tarifs will be gone by July. So to answer the post higher up, Trump takes good ideas, but executes them badly. It's not a double-standard, it's just that he's good at talking but really, really bad at doing things. Doing hard things is hard, and he's lazy. On the other hand he's a good grifter. No one grifts like he does. If his goal in getting elected was to enrich himself, then he's doing a great job.
- fny 1y agoI’m open to arguments that tariffs can be effective, but their advocates rarely seem open to the argument that the way they’re implemented matters. To put it kindly a lot them are chaos apologists.
- netbioserror 1y agoIf we're putting words in peoples' mouths, are the opponents of chaos apologists "wealth-class parasitism apologists"? Because the benefits of a goods-in debt-out trade arrangement have skewed the prosperity curve in one clear direction.
- fny 1y agoA policy, however good an idea, must be implemented properly for lasting success. “Wealth-class parasites” as you call them did that for decades under the guise of stability. Why are none of the new protectionist policies implemented with a modicum of stability? Why must everything be done with flip-flipping gusto? Why do we have to become the laughing stock of the world? For some reason, every sensible person arguing for protectionism (e.g. Oren Cass) at no point argues that how it’s being implemented is detrimental to the cause. Do you really think tarrifs or any other policy experiments will survive if congress flips? The implementation of these ideas is a farce that will only encourage their elimination. This is not how policy persists for decades.
- netbioserror 1y agoWhy stability? If the stable state is not working, flip it. The stable order is facing popular resistance for a reason. Everyone who benefited from the stable state will feel pain and complain, and they'll correct their strategic stances for the newer unstable order: Onshored supply chains, better inventories than just-in-time, less reliance on inflation assets and more on production assets. Even those feeling the pain can see why, but the only ones blind to it are those ideologically staked to the old order, which was not working. Those people don't deserve to be stakeholders anymore, and if they're knocked off their perches, all the better. Renewal will happen. If it won't persist because democracy will flip it around schizophrenically, then you're just speaking ill of democracy at that point. Can't have that.
- SSJPython 1y agoThere's an excellent book by economist Michael Hudson called "America's Protectionist Takeoff" that discusses how the US used tariffs to promote certain industries in order to compete on the world stage. It was part of Alexander Hamilton's American System. Friedrich List, the German economist that wrote "The National System of Political Economy", used the American System to advocate for the same policies in Germany. Germany eventually adopted these policies and became an economic powerhouse themselves. Likewise, Meiji Japan went so far as to adopt the ideas of Friedrich List's economic policies, which resulted in them becoming a great power in a generation. Tariffs can work, but only if they are targeted towards certain industries/sectors. They can't just be slapped across the board and be expected to work properly. Furthermore, they must be attached to certain KPIs such as exports (i.e., the ability to effectively compete on the international market). Joe Studwell's "How Asia Works" argues that Japan, Korea, and Taiwan all used tariffs and subsidies to promote their own "national champions". In turn, they forced those companies export their products rather than just sell domestically in order to compete. If they didn't meet those export targets, those companies were cut off from state support. Ha Joon Chang, a Korean developmental economist, likens this to raising a child: you spend their initial formative years supporting them until they are able to support themselves without your help.
- resters 1y agoThe last thing Trump's tariffs could be described as is targeted industrial policy. They are intentionally a sledge-hammer. They are intentionally emotional. Intentionally full of jingoistic rhetoric and victimhood rhetoric. Sadly there has been zero discussion of doing targeted industrial policy (like China's) in the US. The irony is that Trump's approach benefits China tremendously.
- Waterluvian 1y agoA sober approach to promoting the redevelopment of production industry in America would likely involve some tariffs and could make a lot of sense. But, yeah, the current American approach is anything but sober.
- 1y ago
- maximinus_thrax 1y agoHillsdale College is the type of institution that propagates the big lie: https://dc.hillsdale.edu/News-and-Events/News/Mollie-Hemingway-Outlines-Rigged%E2%80%9D-2020-Election-at/ https://dc.hillsdale.edu/News-and-Events/News/Mollie-Hemingw... Garbage in, garbage out.
- akaru 1y ago[flagged]
- xpe 1y agoSomehow I got on Hillsdale’s mailing list in college. In the spirit of open-mindedness, I try to read their newsletter from time to time without vomiting. I found it nearly impossible. There are much better places to find intellectually honest arguments in favor of libertarianism and so on.
- mindslight 1y ago[flagged]
- brightball 1y agoThat’s a really good read but I can’t believe they covered all of that history of tariffs, referenced the firing on Fort Sumter and never pointed out that Fort Sumter existed almost entirely for…tariff collection. It’s an island right in the middle of the entrance to Charleston Harbor.
- darknavi 1y agoA great place to visit by ferry. As is Fort Moultrie. Super nice rangers when we've gone in the last few years. Then again they might not work there anymore.
- resters 1y agoTariffs and other ideas associated with economic nationalism place politics ahead of the economic freedom of citizens. They declare that economic activity is something that must be stewarded and managed by politicians, and that citizens are too foolish to be allowed to have economic freedom, and that all should sacrifice for the benefit of those chosen by political leaders to benefit from heavy economic restrictions. For comparison, China applies the minimal amount of economic protectionism it deems necessary to achieve its industrial policy goals. The crucial fact about China's approach is that China's leaders do not make silly claims to sell the idea to a naive public, they cite specific, highly targeted industrial policy goals and interfere in the economy as little as possible. They acknowledge the sacrifice that tariffs require and assert that the industrial policy goals are worth it, they do not make false claims about who pays for tariffs. On the contrary, protectionism in the US is a blunt and emotionally wielded instrument that is deployed haphazardly and then suddenly repealed, then deployed again amid rhetoric that the US is a victim and has been taken advantage of, and the emotionally reassuring and politically priceless falsehood that foreign companies pay the cost of tariffs. The costs of recent tariff antics in the US is clear as the economy must now price in the risk of unpredictable and haphazard tariffs along with other systemic risks. Absent from the discussion of tariffs in the US is any coherent idea of industrial policy, any forward-looking or coherent perspective on what should be done to prepare for the future, etc. US tariffs are a purely emotional ploy meant to build up nostalgia for bygone days of US heavy manufacturing. The "us against them" rhetoric and the victimhood rhetoric is just a bonus that (sadly) sells well politically in the US these days. It is not only counter-productive and directly harmful to the US economy, it is also deeply embarrassing that the world has to witness the US self-immolating in this way, hitting our own knee-caps with a hammer, destroying wealth and trust that many people worked so hard to create. Economists don't favor tariffs for one simple reason: Economics is a science and there is overwhelming evidence telling us what will happen. Better policy ideas exist such as targeted industrial policy (such as that done by China) but the US ignores them in favor of the most emotional and reactive posturing imaginable. It should already be clear what happened. Trump made a lot of claims about "deal making" and tariffs. Many of the claims were contradictory from the beginning, meaning if one was true the other could not be true. Supporters are not bothered by that because the appeal is emotional rather than logical. Now we've seen many tariffs get deployed, we've seen markets tank, companies cancel orders, reverse course, hold back on investment decisions. Then we've seen the tariffs get walked back amid bluster and rhetoric. Some economic numbers improve in response to this but not all. It's like the last spasms of a dying creature -- is it an attack or a retreat? Neither or both? All this stems from a deep misunderstanding of American power and American greatness. Misunderstandings like this are easy in a society so heavily influenced by just-so stories and propaganda, societies like ours in which the state religion, American Exceptionalism, is irresistable to so many.
- tzs 1y ago> The U.S., for instance, has a 2.5 percent tariff on cars imported from Germany, while Germany has a ten percent tariff on American cars. In addition, Germany’s value-added tax is remitted on exports but charged on imports. As a result, while the logos of Mercedes-Benz, BMW, and Volkswagen are seen all over American roads, those of Ford and General Motors are a rare sight in Germany. What does that part about VAT have to do with this? VAT is essentially a sales tax with a more involved collection process. The big difference in collections is that VAT is collected at each step of the chain of manufacture and distribution but refunded if the next step is not to a consumer, whereas in sales tax it is only collected on the final sale to a consumer. As for why VAT is remitted on exports, it is the same reason why if GM builds a Tahoe in their factory in Arlington, Texas and sells it to a dealer or consumer that is not in Texas they do not pay Texas sales tax. Sales tax and VAT are both destination based. Exports, whether from Texas or Germany, are not to the final consumer and so VAT and sales tax are not owed. Saying that VAT has anything to do with why BMW is more common than GM in Germany makes as much sense as saying that sales tax is why GM is more common than BMW in Texas.
- bitshiftfaced 1y agoGerman car makers deduct VAT on machinery, equipment, factory supplies, and sometimes even utilities or specific components. Some US states offer car manufacturers tax exceptions on things like raw materials, but it is by no means apples to apples. When BMW builds a car in Germany, it enters the show floor free of embedded taxes on inputs. Thats not necessarily the case for US cars Another important difference has to do with the size of the VAT tax compared to single-stage taxes. For example, in the US if you taxed 19% on inputs every step of the way, no one would be able to afford the final sticker price. Instead, the US taxes a much smaller amount but does not refund this like the VAT system, and the end consumer tax is the same small percentage. VAT can be much higher because it avoids the cascading tax effect. In the end maybe 19% tax was collected on the manufacture and sale in both the US and Germany, and all you changed was one having a higher tax versus cost but the sticker price evened out in the end. Because of this difference in the two tax systems, VAT can be, and is, much higher than US state/local tax. But then, this means that differences in tariffs creates a compounding effect. A German manufacturer can sell to a US end consumer on average about: 100% cost + 2.5% tariff + 102.5% * (8.5% consumption tax) = 111% after tax cost. On the other hand, if Ford builds in the US and sells to a German end consumer, then the calculation goes: 100% cost + 10% tariff +110% * (19% VAT) = 131% after tax cost. So while Germany's VAT is 10.5% higher than the average US sales tax, and equal to the VAT any German would pay in Germany, its actually almost double that amount when you take into account the compounding affect of Germany's higher tariffs. In short, the differences in the two tax systems result in systemically higher tax rates for VAT. And this means that EU car manufacturers do see a trade advantage in terms of selling to EU end consumers compared to US manufacturers selling to EU end consumers (when compared to either selling in the US) since the final after-tax cost calculation is multiplicative.
- deeg 1y agoI am very much an anti Trumper and went into the article with some trepidation but I thought it even-handed, if shallow, overview until the very end. The article correctly points out the disaster of Smoot Hawley and the effectiveness of GATT. It attributes much of the world-wide reduction of poverty on free trade. I think it's written from the view of traditional free-market conservatives unwilling to criticize trump directly.
- watwut 1y agoThey equate VAT with import tax. That is straight up lie. So, I would triple check any other claim they have. Someone lying that blatantly about something so easy to verify is going to lie a lot about stuff that is less known, potentially nuanced and harder to verify - like history.
- mindslight 1y ago> I am very much an anti Trumper This used to just be called a patriotic American.
- DebtDeflation 1y agoThe first 42 paragraphs read like something that could have been written by any libertarian free-market thinker at any point during the last 80 years. The final 3 paragraphs read like something written in the last few months to appease the current administration.
- djeastm 1y agoAnd not a reference, footnote or bibliography in sight. Just another business journalist with an agenda. No thank you.
- jmyeet 1y agoThis is pro-Trump propaganda for what is arguably the dumbest trade war in history by perhaps the most incompetent people ever to helm a global superpower. Let's start with this: > In 1950, according to the World Bank, 62.12 percent of the world’s population was living in extreme poverty. In 2017, the percentage had fallen to 9.18 percent. How did that happen, exactly? Let's do some math. In 1950 the world population was ~2.5B [1]. In 2017 it as ~7.6B. 62% of 2.5B is 1.5B. 9.18% of 7.6B is 700M. What happened in that time? Oh that's right, China lifted 800M people out of extreme poverty [2]. The author's numbers may be off because I've seen other studies that show the number of people in extreme poverty went up if you remove China from the equation entirely. Best case for the author is that China is solely responsible for the decrease in global extreme poverty. But there's no mention of that because the success of a pluralistic yet authoritarian regime with a command economy is not something neoliberals ever want to acknowledge let alone talk about. Oh, as an aside, the author is a climate change denialist [3]. Another choice quote: > The U.S., for instance, has a 2.5 percent tariff on cars imported from Germany, while Germany has a ten percent tariff on American cars. In addition, Germany’s value-added tax is remitted on exports but charged on imports. As a result, while the logos of Mercedes-Benz, BMW, and Volkswagen are seen all over American roads, those of Ford and General Motors are a rare sight in Germany. And China, as already noted, is far worse, a world outlier, in terms of its nefarious trade policies. For an economist who cannot possibly not know better, this is just dishonest. Germany charges VAT on all cars sold in Germany, whether they're domestic or foreign, just like US states charge sales tax in exactly the same way. Also, where are those cars produced? A lot of foreign brands are produced in the US eg BMW's plant in South Carolina [4]. Lastly, this whole "they don't buy our cars" talking point comes straight from the administration when a lot of American cars are simply not suitable for use in Europe. A Ford F150 requires a commercial driving license in much of Europe. Also, try and imagine such a beast navigating the narrow, winding strets of a French village. There's also no mention of how the US outright bans Japanese auto imports where the Japanese produce some of the most reliably and commercially successful trucks on the planet eg the Toyota Hilux. [1]: https://www.worldometers.info/world-population/world-population-by-year/ https://www.worldometers.info/world-population/world-populat... [2]: https://www.worldbank.org/en/news/press-release/2022/04/01/lifting-800-million-people-out-of-poverty-new-report-looks-at-lessons-from-china-s-experience https://www.worldbank.org/en/news/press-release/2022/04/01/l... [3]: https://www.commentary.org/john-steele-gordon/climate-global-warming-data-locations/ https://www.commentary.org/john-steele-gordon/climate-global... [4]: https://www.bmwgroup-werke.com/spartanburg/en.html https://www.bmwgroup-werke.com/spartanburg/en.html
- fdsafaefew 1y ago[flagged]
- profsummergig 1y agoI cannot take seriously an economics article about tariffs without charts in it. For quick skimming of course.
- kiitos 1y ago> The U.S., for instance, has a 2.5 percent tariff on cars imported from Germany, while Germany has a ten percent tariff on American cars. In addition, Germany’s value-added tax is remitted on exports but charged on imports. As a result, while the logos of Mercedes-Benz, BMW, and Volkswagen are seen all over American roads, those of Ford and General Motors are a rare sight in Germany. The fact that America has a bunch of German cars, and Germany doesn't have anywhere near as many American cars, may be influenced somewhat by tariffs, but is in no way explained by or the result of those tariffs. The issue is ultimately just that German cars are, in general, of far higher-quality, compared to American cars.
- lumost 1y ago10% will sway some purchases, and exclusively removes American autos from the “Value” category. As someone who drives a Japanese car, I don't disagree with the premise - but its worth double clicking on whether there is a motivation for American automakers to abandon the value/reliability category.
- watwut 1y ago10% VAT is sales tax that applies to German cars exactly the same way as to American ones. Article is lying.
- pfannkuchen 1y agoAre there not Asian imports in Germany?
- SV_BubbleTime 1y ago>German cars are, in general, of far higher-quality, compared to American cars. Automotive EE here. This is so misleading it might as well be labeled as fiction. The German MODELS that you are familiar with are higher tier vehicles. Notice I did not say the brand was high quality. The truth is 30 plus years ago, ok, fair statement with that note above. But now… almost all brands are using the same suppliers and the same processes. Your seats come from Johnson Controls or Recaro or a mfg you have never heard of but makes Ferrari seats on the same lines as their Toyota seats. There are three ABS / brake system / traction-stability module makers worldwide plus some trash ones in China. The X module in a Fiat is the same part number as that same module in the La Ferrari. The McClaren 500s and 600s use an Android based screen made by the same people that make the one of Polaris. Not to be too general here, but it’s all the same shit. Yes, specs matter. But your programming is coming out of India whether you drive a G Wagon or a Ford. The disparity in your post, is not only about tarrifs, but also the size of the most popular Ford GM Stellatis vehicles. That the above three lose money on their cars and basically only push them as hard as they do in order to tilt CAFE scales. No offense meant, it’s just that when people talk about cars, 99% of the time they have no idea what they’re talking about and myths become reality.
- archagon 1y agoWhy are the mods manually unflagging propaganda?
- saravanan2661 1y agoIt's funny how simple it was back then for a person to go to Britain, memorize plans of machinery, smuggle himself back into America, and start an industrial revolution. Such a legend!
- rambler7 1y agoCompletely unscientific (quick AI research) of top car models imported from the EU to the US + their approximate (end consumer) prices in the US (first price) vs Germany (second) with roughly same specs. Volkswagen Tiguan ~$28,880 ~$39,500 BMW 3 Series (330i) ~$44,500 ~$66,200 Mercedes-Benz GLC ~$47,100 ~$64,500 Audi Q8 e-tron ~$74,400 ~$82,000 Volvo XC90 ~$56,000 ~$87,900 Land Rover Defender 110 ~$60,600 ~$73,500 Porsche Macan ~$62,550 ~$88,000 BMW i4 eDrive40 ~$57,300 ~$66,000 Aren't the end-consumer prices all that matters in the end? Plus its mostly what most people would describe as luxury vehicles - so few percent here/there is just a smoke screen. The other way around its also just Mustangs, Corvettes, Jeeps, Cadillacs, Teslas - again much cheaper in the US than the EU.
- teekert 1y agoI agree, we have pretty insane taxes here so difference could be what we "do to ourselves". So These prices are not real indicative of anything related to Tariffs?
- rambler7 1y agoI mean - isn't the whole discussion on tariffs based on the premise that EU is (mis)using the US somehow? Consumer prices don't show that at all - no matter imported or exported goods, in the end everything is still much cheaper in the US. A part of this is VAT of course but some prices are still much lower in US even when you discount the VAT amount.
- teekert 1y agoYeah, the numbers are certainly very interesting, and indeed perhaps more relevant than I thought. They do highlight the complexity of the issue imho.
- sfdoiaojfias 1y ago[flagged]
- greenie_beans 1y agoi feel like they should maybe detail more about how these tariffs influenced the outbreak of the civil war
- rzwitserloot 1y agoNear the end, the post jumps to conclusions. It starts with 'there is a tariff difference - 2.5% vs 10%, on car imports from europe to the US vs the opposite direction' and then jumps to '... and this explains why there are way more european cars on the road in the US than vice versa'. This jump is not a reasonable one to make. Car imports and exports are vastly more complicated than this. At best, the tariff situation is one small part of a multi-factor explanation for observed phenomenon, such as how US carmakers do not appear to care about european market demands for cars at all (they do not make many cars that are clearly targeted at the needs of european car buyers), whereas european carmakers make quite a few models specifically engineered for the US market, or at least, there is a real demand for them in the US. But I'm just guessing here - possibly the situation is explained much more simply: US carmakers make cars that US consumers want to buy and which US culture wants to make. These cars so happen to be designs that almost nobody in the EU wants. EU carmakers make cars that EU consumers want to buy and which EU culture wants to make. These cars so happen to be designs that a significant fraction of the US also wants to buy. 'fix' the tariff imbalance and I bet almost nothing happens to the relative amount of 'flow' of cars across the atlantic.
- rzwitserloot 1y agoWhat a weird end to a fascinating article. It's like I'm reading the words of a political prisoner. Everything in the first ~80% of it sets up for a conclusion of 'one-sidedly slapping a ton of tariffs on all the things and expecting this to lead to prosperity and the closing of deficits is sheer lunacy', and then ends with: "Well, what an interesting and possibly smart move, lets see how it works out!".
- a2tech 1y agoIt might help to know that hillsdale college is a training ground for far right folks. It presents itself as a bastion of free thought but caters to exclusively well off far right folks.