3 ms·

Tariffs don't do this, though. If you want to do this, you just have to pass laws saying companies are required to manufacture x% of their goods domestically. P

by ang_cire 11mo ago

Tariffs don't do this, though. If you want to do this, you just have to pass laws saying companies are required to manufacture x% of their goods domestically. Putting tariffs in place with no other controls will just see companies shift costs downstream, which is exactly what is happening. Companies employ economists, lawyers, and legislators, all to ensure they can find workarounds for anything they don't like that's not 100% forced on them by a law (and will even flout the law if the cost/benefit works out). All evidence is that tariffs have actually tanked jobs, precisely because companies are assuming a defensive fiscal posture in response to what they view as a hostile fiscal policy.

amypetrik8 11mo ago
> If you want to do this, you just have to pass laws saying companies are required to manufacture x% of their goods domestically. and if they go below <x> they pay a fine yea? yea, thats what a tariff is. you have to manufacture x=100% domestically. otherwise 100-x non-domestic is taxed. that's a tariff.
- parineum 11mo ago
  You're not wrong but the fine can be significantly higher than the tariff. Pay 300% tax if you don't manufacture 10% of your goods in the US. Furthermore, the penalties could escalate from repeat violations. It's a lot more flexible than a blanket tariff on an industry, country or specific good.
- ang_cire 11mo ago
  > and if they go below <x> they pay a fine yea? Where did I say that? No, the point would be if you don't manufacture x% here, you can't sell here. That is the only surefire way to force domestic production. Tariffs don't encourage re-shoring and domestic production, they just raise the barrier of entry on consumers.
beeflet 11mo ago
Shifting costs downstream is the point. It imposes a cost on consumers for the externality they are creating by purchasing goods manufactured overseas. The method you describe is way more easily gamed than a tarrif. What constitutes x% of their goods? Tarrifs are more proportional to the externality we want to discourage.
- somenameforme 11mo ago
  It also opens the door to competition. Right now in many things we can't compete against places like e.g. China because everything is dramatically more affordable there, including regulatory compliance. Tariff's change this and make it such that domestic producers can produce things at a cost comparable, and ideally less, than other countries. These tariffs should have been immediately deployed following changes in labor, environmental, and other laws anyhow - because otherwise all we do is just end up defacto outsourcing pollution and other externalities to the lowest foreign bidder, where the only person who really loses is the American worker.
  - Aeolun 11mo ago
    > Tariff's change this and make it such that domestic producers can produce things at a cost comparable, and ideally less, than other countries. It’s the opposite. It makes things from other countries more expensive. It doesn’t make things from the US cheaper.
    - koolba 11mo ago
      > It’s the opposite. It makes things from other countries more expensive. It doesn’t make things from the US cheaper. All prices are relative. If something is more expensive then de facto its alternatives are cheaper in comparison.
      - thomasz 11mo ago
        But price elasticity isn't infinite. A large part of the middle class would be priced out of most modern amenities if these would be produced domestically. Import substitution is one of these things that sounds nice in theory but tend to be highly damaging in practice.
deleted 11mo ago
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hattmall 11mo ago
Believing that tariffs shift costs downstream means disregarding the idea of supply and demand. Companies are not altruistic actors they price goods at the maximum the market will bear. If they could just pass costs on to consumers then it means that they are already leaving profits on the table. There are in fact alternatives to the goods we import on which tariffs are imposed. Even if the alternative is buying fewer items and spending money on completely different things. At the end of the day tariffs are a bit of plaque in the artery of the multi-national corporations and money flowing out of a country. It's challenging to argue all the negatives of tariffs for the US while ignoring that almost every other country has tariffs that benefit their domestic industries.
- sdenton4 11mo ago
  * Targeted tariffs and blanket tariffs are different beasts. * In order for capitalism to undercut the tariffs, the tariffs need to be high enough to offset the costs of setting up the local industry and the higher costs of US labor (which, in turn, are pushed higher by blanket tariffs). * The tariffs also have to be credibly long-term. If you start building and the tariffs are cancelled, you're screwed. The Trump tariffs don't have this credibility - they're toxic enough that they'll be gone as soon as Trump is, even if it's another Republican in the White House in 2028.

amypetrik8 11mo ago

> If you want to do this, you just have to pass laws saying companies are required to manufacture x% of their goods domestically. and if they go below <x> they pay a fine yea? yea, thats what a tariff is. you have to manufacture x=100% domestically. otherwise 100-x non-domestic is taxed. that's a tariff.

parineum 11mo ago
You're not wrong but the fine can be significantly higher than the tariff. Pay 300% tax if you don't manufacture 10% of your goods in the US. Furthermore, the penalties could escalate from repeat violations. It's a lot more flexible than a blanket tariff on an industry, country or specific good.
ang_cire 11mo ago
> and if they go below <x> they pay a fine yea? Where did I say that? No, the point would be if you don't manufacture x% here, you can't sell here. That is the only surefire way to force domestic production. Tariffs don't encourage re-shoring and domestic production, they just raise the barrier of entry on consumers.

beeflet 11mo ago

Shifting costs downstream is the point. It imposes a cost on consumers for the externality they are creating by purchasing goods manufactured overseas. The method you describe is way more easily gamed than a tarrif. What constitutes x% of their goods? Tarrifs are more proportional to the externality we want to discourage.

somenameforme 11mo ago
It also opens the door to competition. Right now in many things we can't compete against places like e.g. China because everything is dramatically more affordable there, including regulatory compliance. Tariff's change this and make it such that domestic producers can produce things at a cost comparable, and ideally less, than other countries. These tariffs should have been immediately deployed following changes in labor, environmental, and other laws anyhow - because otherwise all we do is just end up defacto outsourcing pollution and other externalities to the lowest foreign bidder, where the only person who really loses is the American worker.
- Aeolun 11mo ago
  > Tariff's change this and make it such that domestic producers can produce things at a cost comparable, and ideally less, than other countries. It’s the opposite. It makes things from other countries more expensive. It doesn’t make things from the US cheaper.
  - koolba 11mo ago
    > It’s the opposite. It makes things from other countries more expensive. It doesn’t make things from the US cheaper. All prices are relative. If something is more expensive then de facto its alternatives are cheaper in comparison.
    - thomasz 11mo ago
      But price elasticity isn't infinite. A large part of the middle class would be priced out of most modern amenities if these would be produced domestically. Import substitution is one of these things that sounds nice in theory but tend to be highly damaging in practice.

deleted 11mo ago

[deleted]

hattmall 11mo ago

Believing that tariffs shift costs downstream means disregarding the idea of supply and demand. Companies are not altruistic actors they price goods at the maximum the market will bear. If they could just pass costs on to consumers then it means that they are already leaving profits on the table. There are in fact alternatives to the goods we import on which tariffs are imposed. Even if the alternative is buying fewer items and spending money on completely different things. At the end of the day tariffs are a bit of plaque in the artery of the multi-national corporations and money flowing out of a country. It's challenging to argue all the negatives of tariffs for the US while ignoring that almost every other country has tariffs that benefit their domestic industries.

sdenton4 11mo ago
* Targeted tariffs and blanket tariffs are different beasts. * In order for capitalism to undercut the tariffs, the tariffs need to be high enough to offset the costs of setting up the local industry and the higher costs of US labor (which, in turn, are pushed higher by blanket tariffs). * The tariffs also have to be credibly long-term. If you start building and the tariffs are cancelled, you're screwed. The Trump tariffs don't have this credibility - they're toxic enough that they'll be gone as soon as Trump is, even if it's another Republican in the White House in 2028.