4 ms·

> Trump is out there creating the most regressive tax system via tariffs Tariffs incentivize domestic production. See the case of chicken tax and pickup trucks

> Trump is out there creating the most regressive tax system via tariffs Tariffs incentivize domestic production. See the case of chicken tax and pickup trucks. While we do pay for tariffs now, later down the road we should not as more things would be made domestically. If you don’t do tariffs, there is no way to force producers to onshore.

JumpCrisscross 1y ago
> Tariffs incentivize domestic production Stable, long term tariffs. We’re seeing historic falls in manufacturing employment for a reason.
- reliabilityguy 1y ago
  > Stable, long term tariffs. Well, you have to start somewhere. > We’re seeing historic falls in manufacturing employment for a reason. In your opinion, what is this reason?
  - JumpCrisscross 1y ago
    > you have to start somewhere There has been no start. You don’t build a factory because the President announced a tariff that he is also negotiating a trade deal around. > what is this reason? I’m remodelling my deck. I had orders into a steel mill in Utah. Tariffs mean their steel inputs are pricer than competitors in Vietnam. So I switched the order. And I paid with a cheque—if I paid cash I could skip taxes altogether. That wasn’t a thing six months ago. Meanwhile, software and services aren’t tariffed. Just goods. Guess whose cost of capital has sunk.
    - reliabilityguy 1y ago
      > There has been no start. You don’t build a factory because the President announced a tariff that he is also negotiating a trade deal around. You absolutely do once the math of tariffs makes your manufacturing abroad not competitive with onshored one. Will it apply for all categories of products? Probably not. However, it will definitely apply for many. I am not sure I understood your reply about the reasons.
      - JumpCrisscross 1y ago
        > absolutely do once the math of tariffs makes your manufacturing abroad not competitive with onshored one If someone bet on e.g. our Japan tariffs three months ago, they lost money. (Nobody did. The types that take Trump at his word on tariffs aren’t making economically significant decisions.)
        reliabilityguy 1y ago
        I do not know why anyone would bet that the executive order defined tariffs would stay. It was and still clear as a day that Trump uses them to force people to the negotiation table. Obviously, negotiated deal may look different. Regardless, tariffs as an instrument have their merit with Trump or without Trump. Strategically, US has to bring manufacturing (and as much of a supply chains) back, there is no way around it.
        gambiting 1y ago
        >>Regardless, tariffs as an instrument have their merit with Trump or without Trump. Strategically, US has to bring manufacturing (and as much of a supply chains) back, there is no way around it. Well no. Not really. Not for everything anyway. Some things like electronics - sure, but it's a matter of national security not economy - it doesn't have to make financial sense, it just has to exist so that the country can have that ability no matter what happens. As a simple(and really oversimplified) example - let's say that tariffs force clothes manufacturers to bring tshirt making back to the States. The $5 T-Shirt now costs $30 due to tarrifs. So ok, someone makes a factory in US because now it makes sense, employs american workers, pays them good wage - ok, now they make t-shirts cost $20 because they are made domestically. Cool - that's great, but now the rest of the world still buys $5 tshirts, while Americans buy $20 ones that can't even be exported anywhere because why would anyone buy them if they have cheaper alternatives. All you've done is you increased the cost of your products to the american consumers. Some can argue - ok, that doesn't matter, what matters is that manufacturing is now back in the states and american people have employment. And sure, there is merit to that argument - but it reminds me of how my own country used to work under communist rule, people would go "comrade party leader, people have no jobs", "ok, we'll build a factory here so you can have jobs". Can the factory make anything that is actually worth making? Doesn't matter, what matters is that people got jobs and "manufacturing is happening here" - for an economy based on capitalist principles, that sounds like a disaster for US. But hey, what do I know. Just an external observer.
toast0 1y ago
The chicken tax encourages creative workarounds more than domestic production. Importing all the parts and putting them together in the US is production work, so fine. Importing chassis cab and putting a bed on in the US is silly, importing with seats discarded in the US is wasteful (Ford got dinged, but I don't think others did?) Who's making small cargo vans domestically? Nobody. So they're all 25% more expensive, so you might as well buy a big cargo van when a small one would do. Honestly, governments buy enough light trucks, that 'buy american' requirements would likely keep at least one company making them here.
- reliabilityguy 1y ago
  Chicken tax was introduced earlier than all the “relaxation” of what is considered “American”. The definition of “made in USA” became more flexible for products to be considered domestic while de facto being made somewhere else, hurting domestic manufacturing. So, it’s not that the tax doesn’t work, the issue is all the things around it that made it less effective.
  - toast0 1y ago
    Chicken tax was enacted in 1964; Ford and Chevy were tariff engineering in 1972, importing trucks without beds and putting beds on in the US. Finding loopholes and driving trucks through them is what's considered American. It's not a relaxation. At the end of the day, the chicken tax reduces our options in the vehicle market as it was designed to do, and it's one thing if we want to exclude WV vans and trucks when we have plenty of nice options at home, but now that we don't have nice options at home, it would be nice to be able to import them without a punative tariff.
watwut 1y ago
That particular outcome is possible when you make tariffs in a smart and predictable way. Trumps tariffs are unpredictable and also make local producers pay more for raw material they need.
- reliabilityguy 1y ago
  > That particular outcome is possible when you make tariffs in a smart and predictable way. You would have to prove that claim. There is more than one way to achieve a specific goal. > Trumps tariffs are unpredictable and also make local producers pay more for raw material they need. It’s one of the consequences. There are other ones. Is your only objective is to ensure that local manufacturers pay the least amount possible for their raw materials? This is very simplistic view of things.
  - amanaplanacanal 1y ago
    This isn't rocket science. If you want somebody to spend a lot of money and time setting up production in the US, tariffs have to be stable and predictable. If that doesn't make sense to you, I didn't know what to say.
    - reliabilityguy 1y ago
      And they are after the deals are signed, no?
      - notahacker 1y ago
        A lot of deals got ripped up on "Liberation Day", including some Trump was extremely proud of when he announced them in his last term. He's changed his mind several times in six months already, dropping deadlines and tariffs when the market gets itchy feet, imposing higher tariffs due to disputes with governments completely unrelated to trade. He loves to make grand gestures to distract from domestic issues, and his administration showed so little basic competency they actually publicly announced tariffs on uninhabited territories full of penguins. Why would anybody assume stability? To echo a comment made in a parallel thread, decisions made to invest in US manufacturing don't get made by people dumb enough to take Trump at his word. And even if he wasn't tariffs are unlikely to persist at those levels under the next President, regardless of who that is, and that's the sort of timeline you pay back your investment in US manufacturing over...
Hikikomori 1y ago
Long term stable tariffs yes. But you can't pretend like trumps tariffs were not done in the worst way possible?
- reliabilityguy 1y ago
  Trump uses wild % amounts as a negotiation tactic. Is it the best way to do it? I don’t know. You can’t argue though that it does force the other side to come quickly to negotiation table to talk about the deal. So, if the goal is to get the deal now, then it’s effective. If the goal is something else, then it’s not a good tactic. I do not have enough information to definitely say whether it’s good or bad. Most of the things in life are neither because they have good side effects, and bad side effects to them. So, I think looking for a “good only” solution is a loosing strategy.
  - Hikikomori 1y ago
    Negotiate what? You realize they can just set it right? If it was a long term strategy they would just set a fixed % and leave it at that, otherwise companies cannot make any plans.
  - amanaplanacanal 1y ago
    I'm confused. Is the goal the get manufacturing back in the US, or to make new trade deals? I've heard both things. Oh, and something about fentanyl coming in from Canada? Alright I'm not sure how tariffs would stop that.
  - fireflash38 1y ago
    You're talking out of both sides of your mouth. You say we need tariffs to bring manufacturing back. Then you turn around and say the tariffs aren't the point, it's the deal. You even said it was silly to bet on announced tariffs elsewhere. If the tariffs are necessary to bring manufacturing back full stop, then you don't need to "make a deal". If it's just a tool to make a deal, then they're not necessary! You just keep moving those goalposts.
  - agent_turtle 1y ago
wat10000 1y ago
When tariffs are imposed by the other side, they’re called “sanctions” and are considered one step short of declaring war. If they’re so great then they wouldn’t be used as punishment. Economists pretty much universally agree that tariffs are bad for both sides. It can make sense to use them to preserve strategic industries even if it’s less efficient economically. For example, tariffs on food could make sense to ensure an enemy can’t starve you with a blockade. But as a blanket policy it’s just bad.
dgb23 1y ago
Only sector targeted tariffs paired with long term investment and commitment do that.

JumpCrisscross 1y ago

> Tariffs incentivize domestic production Stable, long term tariffs. We’re seeing historic falls in manufacturing employment for a reason.

reliabilityguy 1y ago
> Stable, long term tariffs. Well, you have to start somewhere. > We’re seeing historic falls in manufacturing employment for a reason. In your opinion, what is this reason?
- JumpCrisscross 1y ago
  > you have to start somewhere There has been no start. You don’t build a factory because the President announced a tariff that he is also negotiating a trade deal around. > what is this reason? I’m remodelling my deck. I had orders into a steel mill in Utah. Tariffs mean their steel inputs are pricer than competitors in Vietnam. So I switched the order. And I paid with a cheque—if I paid cash I could skip taxes altogether. That wasn’t a thing six months ago. Meanwhile, software and services aren’t tariffed. Just goods. Guess whose cost of capital has sunk.
  - reliabilityguy 1y ago
    > There has been no start. You don’t build a factory because the President announced a tariff that he is also negotiating a trade deal around. You absolutely do once the math of tariffs makes your manufacturing abroad not competitive with onshored one. Will it apply for all categories of products? Probably not. However, it will definitely apply for many. I am not sure I understood your reply about the reasons.
    - JumpCrisscross 1y ago
      > absolutely do once the math of tariffs makes your manufacturing abroad not competitive with onshored one If someone bet on e.g. our Japan tariffs three months ago, they lost money. (Nobody did. The types that take Trump at his word on tariffs aren’t making economically significant decisions.)
      - reliabilityguy 1y ago
        I do not know why anyone would bet that the executive order defined tariffs would stay. It was and still clear as a day that Trump uses them to force people to the negotiation table. Obviously, negotiated deal may look different. Regardless, tariffs as an instrument have their merit with Trump or without Trump. Strategically, US has to bring manufacturing (and as much of a supply chains) back, there is no way around it.
        gambiting 1y ago
        >>Regardless, tariffs as an instrument have their merit with Trump or without Trump. Strategically, US has to bring manufacturing (and as much of a supply chains) back, there is no way around it. Well no. Not really. Not for everything anyway. Some things like electronics - sure, but it's a matter of national security not economy - it doesn't have to make financial sense, it just has to exist so that the country can have that ability no matter what happens. As a simple(and really oversimplified) example - let's say that tariffs force clothes manufacturers to bring tshirt making back to the States. The $5 T-Shirt now costs $30 due to tarrifs. So ok, someone makes a factory in US because now it makes sense, employs american workers, pays them good wage - ok, now they make t-shirts cost $20 because they are made domestically. Cool - that's great, but now the rest of the world still buys $5 tshirts, while Americans buy $20 ones that can't even be exported anywhere because why would anyone buy them if they have cheaper alternatives. All you've done is you increased the cost of your products to the american consumers. Some can argue - ok, that doesn't matter, what matters is that manufacturing is now back in the states and american people have employment. And sure, there is merit to that argument - but it reminds me of how my own country used to work under communist rule, people would go "comrade party leader, people have no jobs", "ok, we'll build a factory here so you can have jobs". Can the factory make anything that is actually worth making? Doesn't matter, what matters is that people got jobs and "manufacturing is happening here" - for an economy based on capitalist principles, that sounds like a disaster for US. But hey, what do I know. Just an external observer.

toast0 1y ago

The chicken tax encourages creative workarounds more than domestic production. Importing all the parts and putting them together in the US is production work, so fine. Importing chassis cab and putting a bed on in the US is silly, importing with seats discarded in the US is wasteful (Ford got dinged, but I don't think others did?) Who's making small cargo vans domestically? Nobody. So they're all 25% more expensive, so you might as well buy a big cargo van when a small one would do. Honestly, governments buy enough light trucks, that 'buy american' requirements would likely keep at least one company making them here.

reliabilityguy 1y ago
Chicken tax was introduced earlier than all the “relaxation” of what is considered “American”. The definition of “made in USA” became more flexible for products to be considered domestic while de facto being made somewhere else, hurting domestic manufacturing. So, it’s not that the tax doesn’t work, the issue is all the things around it that made it less effective.
- toast0 1y ago
  Chicken tax was enacted in 1964; Ford and Chevy were tariff engineering in 1972, importing trucks without beds and putting beds on in the US. Finding loopholes and driving trucks through them is what's considered American. It's not a relaxation. At the end of the day, the chicken tax reduces our options in the vehicle market as it was designed to do, and it's one thing if we want to exclude WV vans and trucks when we have plenty of nice options at home, but now that we don't have nice options at home, it would be nice to be able to import them without a punative tariff.

watwut 1y ago

That particular outcome is possible when you make tariffs in a smart and predictable way. Trumps tariffs are unpredictable and also make local producers pay more for raw material they need.

reliabilityguy 1y ago
> That particular outcome is possible when you make tariffs in a smart and predictable way. You would have to prove that claim. There is more than one way to achieve a specific goal. > Trumps tariffs are unpredictable and also make local producers pay more for raw material they need. It’s one of the consequences. There are other ones. Is your only objective is to ensure that local manufacturers pay the least amount possible for their raw materials? This is very simplistic view of things.
- amanaplanacanal 1y ago
  This isn't rocket science. If you want somebody to spend a lot of money and time setting up production in the US, tariffs have to be stable and predictable. If that doesn't make sense to you, I didn't know what to say.
  - reliabilityguy 1y ago
    And they are after the deals are signed, no?
    - notahacker 1y ago
      A lot of deals got ripped up on "Liberation Day", including some Trump was extremely proud of when he announced them in his last term. He's changed his mind several times in six months already, dropping deadlines and tariffs when the market gets itchy feet, imposing higher tariffs due to disputes with governments completely unrelated to trade. He loves to make grand gestures to distract from domestic issues, and his administration showed so little basic competency they actually publicly announced tariffs on uninhabited territories full of penguins. Why would anybody assume stability? To echo a comment made in a parallel thread, decisions made to invest in US manufacturing don't get made by people dumb enough to take Trump at his word. And even if he wasn't tariffs are unlikely to persist at those levels under the next President, regardless of who that is, and that's the sort of timeline you pay back your investment in US manufacturing over...

Hikikomori 1y ago

Long term stable tariffs yes. But you can't pretend like trumps tariffs were not done in the worst way possible?

reliabilityguy 1y ago
Trump uses wild % amounts as a negotiation tactic. Is it the best way to do it? I don’t know. You can’t argue though that it does force the other side to come quickly to negotiation table to talk about the deal. So, if the goal is to get the deal now, then it’s effective. If the goal is something else, then it’s not a good tactic. I do not have enough information to definitely say whether it’s good or bad. Most of the things in life are neither because they have good side effects, and bad side effects to them. So, I think looking for a “good only” solution is a loosing strategy.
- Hikikomori 1y ago
  Negotiate what? You realize they can just set it right? If it was a long term strategy they would just set a fixed % and leave it at that, otherwise companies cannot make any plans.
- amanaplanacanal 1y ago
  I'm confused. Is the goal the get manufacturing back in the US, or to make new trade deals? I've heard both things. Oh, and something about fentanyl coming in from Canada? Alright I'm not sure how tariffs would stop that.
- fireflash38 1y ago
  You're talking out of both sides of your mouth. You say we need tariffs to bring manufacturing back. Then you turn around and say the tariffs aren't the point, it's the deal. You even said it was silly to bet on announced tariffs elsewhere. If the tariffs are necessary to bring manufacturing back full stop, then you don't need to "make a deal". If it's just a tool to make a deal, then they're not necessary! You just keep moving those goalposts.
- agent_turtle 1y ago

wat10000 1y ago

When tariffs are imposed by the other side, they’re called “sanctions” and are considered one step short of declaring war. If they’re so great then they wouldn’t be used as punishment. Economists pretty much universally agree that tariffs are bad for both sides. It can make sense to use them to preserve strategic industries even if it’s less efficient economically. For example, tariffs on food could make sense to ensure an enemy can’t starve you with a blockade. But as a blanket policy it’s just bad.

dgb23 1y ago

Only sector targeted tariffs paired with long term investment and commitment do that.