So far this seems in line with a sarcastic prediction comment [0] from 16 days ago.
> We'll just force the EU to do what we want or else we take our business to China! Meanwhile, we'll force China to do what we want or else we'll take our business to the EU! Plus we can throw Canada and Mexico into the mix, and show them who's boss.
> There is absolutely no way this genius "alienate every viable major trading partner simultaneously" strategy could ever fail. I mean, even if other countries somehow exhibit more intelligence than a turnip and compare notes, this is America! We don't need 'em! We'll just trade with nobody and get super rich until they come begging to our feet.
I think a 10% tax on Chinese goods is not a disaster. For all the cheap stuff we get from there, it will still be cheap. You might have to pay $5.50 for something instead of $5. For all the expensive stuff, 10% additional won't be a deal breaker for someone already wanting to buy it.
I don't know too much about what we import from Mexico and Canada, other than I know we have factories in Mexico.
As far as jobs, those got offshored originally starting in the 70's because companies wanted cheaper stuff, i.e. lower wages. The notion to bring the jobs back here is great, but I don't think companies will want to pay higher wages (if that does happen that's awesome but I'm pessimistic), and they really don't have a choice with housing costs the way they are now (also pessimistic), so I see the pendulum swining back eventually. Maybe legal immigration will become easier and deregulated. Maybe enterprises needing cheap labor will become more directly involved in the process.
That reassurance seems to rest on two extremely shaky assumptions:
1. That the first "10%" move move by the US is the only move anybody ever makes, one trade-battle that ends the entire potential trade-war in one fell swoop, as if all other countries are just too dumb/meek to retaliate.
2. That US tariffs will be implemented as totally flat rate uniformly across everything, rather than being concentrated to cause domestic winners and losers. (10% tax on 100% of items is very different than 100% tax on 10% of items.)
Neither of those were true last time. Rather than overall prosperity, tariffs paid by US consumers just became a subsidy ("forced redistributive welfare", if you like) for US producers. [0]
It’s basically a 10% increase in consumer prices for most goods, so…that has to stoke a few points of inflation. Not enough to move production back to the USA, since that would cost even more money, we just pay more.
The Mexico/Canada tariff is weird since we would basically be drastically curtailing business with our biggest trading partners, which is not in any way one way. He says it’s fentanyl related…it’s definitely not something you’d come up with sober.
So basically this is a national sales tax that will increase inflation in the US.
So far this seems in line with a sarcastic prediction comment [0] from 16 days ago.
> We'll just force the EU to do what we want or else we take our business to China! Meanwhile, we'll force China to do what we want or else we'll take our business to the EU! Plus we can throw Canada and Mexico into the mix, and show them who's boss.
> There is absolutely no way this genius "alienate every viable major trading partner simultaneously" strategy could ever fail. I mean, even if other countries somehow exhibit more intelligence than a turnip and compare notes, this is America! We don't need 'em! We'll just trade with nobody and get super rich until they come begging to our feet.
[0] https://news.ycombinator.com/item?id=42096334
I think a 10% tax on Chinese goods is not a disaster. For all the cheap stuff we get from there, it will still be cheap. You might have to pay $5.50 for something instead of $5. For all the expensive stuff, 10% additional won't be a deal breaker for someone already wanting to buy it.
I don't know too much about what we import from Mexico and Canada, other than I know we have factories in Mexico.
As far as jobs, those got offshored originally starting in the 70's because companies wanted cheaper stuff, i.e. lower wages. The notion to bring the jobs back here is great, but I don't think companies will want to pay higher wages (if that does happen that's awesome but I'm pessimistic), and they really don't have a choice with housing costs the way they are now (also pessimistic), so I see the pendulum swining back eventually. Maybe legal immigration will become easier and deregulated. Maybe enterprises needing cheap labor will become more directly involved in the process.
That reassurance seems to rest on two extremely shaky assumptions:
1. That the first "10%" move move by the US is the only move anybody ever makes, one trade-battle that ends the entire potential trade-war in one fell swoop, as if all other countries are just too dumb/meek to retaliate.
2. That US tariffs will be implemented as totally flat rate uniformly across everything, rather than being concentrated to cause domestic winners and losers. (10% tax on 100% of items is very different than 100% tax on 10% of items.)
Neither of those were true last time. Rather than overall prosperity, tariffs paid by US consumers just became a subsidy ("forced redistributive welfare", if you like) for US producers. [0]
[0] https://www.cfr.org/blog/92-percent-trumps-china-tariff-proc...
Maybe you should look up what is traded within nafta. You think a 10% increase on cars or construction is not a big deal eh?
It’s basically a 10% increase in consumer prices for most goods, so…that has to stoke a few points of inflation. Not enough to move production back to the USA, since that would cost even more money, we just pay more.
The Mexico/Canada tariff is weird since we would basically be drastically curtailing business with our biggest trading partners, which is not in any way one way. He says it’s fentanyl related…it’s definitely not something you’d come up with sober.
> He says it’s fentanyl related…it’s definitely not something you’d come up with sober.
I find myself thinking of scrambled domestic-abuse logic, except scaled up: "Why did you make me do that, Mexico!? Now look at the mess you caused."
This isn’t going to happen