4 ms·

Put differently, Trump is explicitly attempting to destroy the reason the American stock market generally goes up.

by inigyou 2mo ago

smallmancontrov 2mo ago
Yes, but I'm pretty sure he doesn't know that and thinks flapping between protectionism and TACO is a brilliant strategy for achieving the best of both worlds rather than an idiotic strategy guaranteed to result in the worst of both worlds. "Destroy American affluence so that we can't pay with assets instead of exports" is probably the worst conceivable way to unwind the exorbitant privilege of the American Economy. We could have spent that money helping people, instead we spent it on wars and tax breaks for billionaires. We could have spent that money on targeted industrial policy (the IRA and CHIPS acts under Biden were examples of this done right, just not at the scale we needed) but instead we are doing it the hard way. Sigh.
Shiggy_ 2mo ago
That is not what the user above you said. They're explicitly pointing out that the US (and most of the western world) has abandoned the manufacturing sector of their economy, outsourcing work that used to employ millions of people to the developing world. This is a trade-off that can benefit both countries, but, it is wise to consider both WHO benefits from this, and what the LONG-TERM implications of this entails. It's great for an investor class in America that has the capital to create factories in China, and it's great for China to take USD and start to employ their workforce. But, the question is whether or not this is actually a good thing for the American worker. The rust-belt would certainly have an opinion on this. My father was a factory worker that was able to support a family on a single income, and when that manufacturing plant closed, it absolutely destroyed the finances of my family.
- teachrdan 2mo ago
  This is a false dichotomy. I personally believe that strategic tariffs should be used to protect our national interests, including providing meaningful employment. This administration has no interest in strategic tariffs. Instead, they are made overbroad (50% on everything from Canada vs, say, cheap imported steel) and they are made and removed capriciously (tariffs on English whisky dropped after King Charles' visit to the White House). If Trump really wanted to bring your dad's factory job back, he'd specifically target whatever industry he was working in AND ideally spend the tariff money boosting that industry. This is precisely the strategy countries like Japan used to reach first world status. Instead Trump uses tariffs like a cudgel -- much closer to what the XKCD comic depicts. There is no chance his tariffs will lead to your father's factory ever being reopened, as that would require, at the bare minimum, a tariff that investors know will stay in place for years, as opposed to one that could be lifted with the visit of a charismatic member of nobility.
  - peezd 2mo ago
    [...wanted to bring your dad's factory job back, he'd specifically target whatever industry he was working in AND ideally spend the tariff money boosting that industry.] Which was more or less the intent of the CHIPS and Science Act for the semiconductors industry.
    - edgyquant 2mo ago
      The chips act used tax dollars and subsidies to incentivize companies to build here. This and tariffs on semis are not much different the only difference is with a tariff you only pay the tax when you buy imported goods
      - kasey_junk 2mo ago
        Tariffs are much more regressive than our normal tax policy. Which is probably the reason this administration prefers them.
      - inigyou 2mo ago
        Subsidies ensure a certain sector has money. CHIPS pays for semiconductor fabs no matter what. Tariffing foreign semiconductors doesn't ensure there will be money for semiconductor fabs here - there could just be no semiconductors at all.
        edgyquant 2mo ago
        There will not be zero semiconductors. Tariffs incentivize domestic production by raising imported prices allowing our industries to be competitive. There is no world where the military and industry just don’t have processors anymore they will be forced to invest locally that’s THE point of tariffs traditionally (see: the us after its founding) And the chips act was subsidies
  - Shiggy_ 2mo ago
    Oh, I agree that the way that the tariffs are currently being levied is embarrassing on a national scale. Also on the fact that meaningful economic change won't happen when these tariffs will disappear/re-appear at the drop of a hat. It's also worth pointing out that while, yes, there is 50% tariff on Canadian goods, this only effects ~5% of imported goods, meaning 95% of the Canadian imports are unaffected by this nonsense. It's also worth pointing out that some of these tariffs actually are being used to help build out US industry, like the CHIPS act. I don't think that we disagree on anything here, haha
- didibus 2mo ago
  You're conflating the goal with the approach. If the goal is to bring back or grow US manufacturing, the question is whether the current tariffs are an effective way to accomplish that relative to their trade offs. From the evidence so far, the historical research, and most economic analysis, the case doesn't look particularly strong. We haven't seen a meaningful revival in manufacturing employment, and even analyses that project some growth in manufacturing find that it comes with substantial costs elsewhere in the economy, including higher input and consumer prices, weaker growth in other sectors, and lower overall GDP.
pessimizer 2mo ago
Yes, and this is good. The American stock market going up benefits 10% of the US population. The US has the highest share of revenue going to owners than it ever has in history. We've left behind the Gilded Age. https://libertystreeteconomics.newyorkfed.org/2026/06/the-post-covid-decline-in-the-labor-share/ https://libertystreeteconomics.newyorkfed.org/2026/06/the-po...
- otterley 2mo ago
  Where are you getting this 10% number? 54.3% of US households held a retirement account in 2022. https://www.federalreserve.gov/publications/files/scf23.pdf https://www.federalreserve.gov/publications/files/scf23.pdf
  - quickthrowman 2mo ago
    The top 10% of wealth holders own 90% of stocks. The other 90% of people not in the top 10% own the remaining 10%.

Put differently, Trump is explicitly attempting to destroy the reason the American stock market generally goes up.

by inigyou 2mo ago

Put differently, Trump is explicitly attempting to destroy the reason the American stock market generally goes up.

Yes, but I'm pretty sure he doesn't know that and thinks flapping between protectionism and TACO is a brilliant strategy for achieving the best of both worlds rather than an idiotic strategy guaranteed to result in the worst of both worlds. "Destroy American affluence so that we can't pay with assets instead of exports" is probably the worst conceivable way to unwind the exorbitant privilege of the American Economy. We could have spent that money helping people, instead we spent it on wars and tax breaks for billionaires. We could have spent that money on targeted industrial policy (the IRA and CHIPS acts under Biden were examples of this done right, just not at the scale we needed) but instead we are doing it the hard way. Sigh.

Shiggy_ 2mo ago

That is not what the user above you said. They're explicitly pointing out that the US (and most of the western world) has abandoned the manufacturing sector of their economy, outsourcing work that used to employ millions of people to the developing world. This is a trade-off that can benefit both countries, but, it is wise to consider both WHO benefits from this, and what the LONG-TERM implications of this entails. It's great for an investor class in America that has the capital to create factories in China, and it's great for China to take USD and start to employ their workforce. But, the question is whether or not this is actually a good thing for the American worker. The rust-belt would certainly have an opinion on this. My father was a factory worker that was able to support a family on a single income, and when that manufacturing plant closed, it absolutely destroyed the finances of my family.

teachrdan 2mo ago
This is a false dichotomy. I personally believe that strategic tariffs should be used to protect our national interests, including providing meaningful employment. This administration has no interest in strategic tariffs. Instead, they are made overbroad (50% on everything from Canada vs, say, cheap imported steel) and they are made and removed capriciously (tariffs on English whisky dropped after King Charles' visit to the White House). If Trump really wanted to bring your dad's factory job back, he'd specifically target whatever industry he was working in AND ideally spend the tariff money boosting that industry. This is precisely the strategy countries like Japan used to reach first world status. Instead Trump uses tariffs like a cudgel -- much closer to what the XKCD comic depicts. There is no chance his tariffs will lead to your father's factory ever being reopened, as that would require, at the bare minimum, a tariff that investors know will stay in place for years, as opposed to one that could be lifted with the visit of a charismatic member of nobility.
- peezd 2mo ago
  [...wanted to bring your dad's factory job back, he'd specifically target whatever industry he was working in AND ideally spend the tariff money boosting that industry.] Which was more or less the intent of the CHIPS and Science Act for the semiconductors industry.
  - edgyquant 2mo ago
    The chips act used tax dollars and subsidies to incentivize companies to build here. This and tariffs on semis are not much different the only difference is with a tariff you only pay the tax when you buy imported goods
    - kasey_junk 2mo ago
      Tariffs are much more regressive than our normal tax policy. Which is probably the reason this administration prefers them.
    - inigyou 2mo ago
      Subsidies ensure a certain sector has money. CHIPS pays for semiconductor fabs no matter what. Tariffing foreign semiconductors doesn't ensure there will be money for semiconductor fabs here - there could just be no semiconductors at all.
      - edgyquant 2mo ago
        There will not be zero semiconductors. Tariffs incentivize domestic production by raising imported prices allowing our industries to be competitive. There is no world where the military and industry just don’t have processors anymore they will be forced to invest locally that’s THE point of tariffs traditionally (see: the us after its founding) And the chips act was subsidies
- Shiggy_ 2mo ago
  Oh, I agree that the way that the tariffs are currently being levied is embarrassing on a national scale. Also on the fact that meaningful economic change won't happen when these tariffs will disappear/re-appear at the drop of a hat. It's also worth pointing out that while, yes, there is 50% tariff on Canadian goods, this only effects ~5% of imported goods, meaning 95% of the Canadian imports are unaffected by this nonsense. It's also worth pointing out that some of these tariffs actually are being used to help build out US industry, like the CHIPS act. I don't think that we disagree on anything here, haha
didibus 2mo ago
You're conflating the goal with the approach. If the goal is to bring back or grow US manufacturing, the question is whether the current tariffs are an effective way to accomplish that relative to their trade offs. From the evidence so far, the historical research, and most economic analysis, the case doesn't look particularly strong. We haven't seen a meaningful revival in manufacturing employment, and even analyses that project some growth in manufacturing find that it comes with substantial costs elsewhere in the economy, including higher input and consumer prices, weaker growth in other sectors, and lower overall GDP.

pessimizer 2mo ago

Yes, and this is good. The American stock market going up benefits 10% of the US population. The US has the highest share of revenue going to owners than it ever has in history. We've left behind the Gilded Age. https://libertystreeteconomics.newyorkfed.org/2026/06/the-post-covid-decline-in-the-labor-share/ https://libertystreeteconomics.newyorkfed.org/2026/06/the-po...

otterley 2mo ago
Where are you getting this 10% number? 54.3% of US households held a retirement account in 2022. https://www.federalreserve.gov/publications/files/scf23.pdf https://www.federalreserve.gov/publications/files/scf23.pdf
- quickthrowman 2mo ago
  The top 10% of wealth holders own 90% of stocks. The other 90% of people not in the top 10% own the remaining 10%.