Why Is The Tariff Issue Controversial?
Setting aside that it could depend on the size of the tariff and the product involved, if you stick to one proposal at a time why is there such a debate about each one of them? If you put a 50% tariff on widgets from Babylon it would seem to result in obvious results. Yet there is this big debate, Are people disagreeing about what the results would be or are they disagreeing not about the results. but rather about whether we want those results?
Setting aside that it could depend on the size of the tariff and the product involved, if you stick to one proposal at a time why is there such a debate about each one of them? If you put a 50% tariff on widgets from Babylon it would seem to result in obvious results. Yet there is this big debate, A
1) The result isn't obvious at all because the world isn't made up of 2 countries setting tariffs with each other (see for example the idea of the targeted country setting up business in Mexico)
1bis) The result isn't obvious IN GENERAL because you don't only have your own producers competing with a specific country producers, but with the whole world. So you actually don't know what will happend to the supply and demand of the targeted good, and to prices.
1) doesn't apply if you set tariffs on a specific good at the same level for the totality of countries but you can't because of trade deals with specific countries, so 1) always holds
2) Tariffs are often predicated on reasons that go beyond economic so the quantification of those issues isn't objective and the value-weighting of those issues isn't objective. Examples:
-National security (in an enlarged sense) might require to be able to source some goods in case of future war, so you might want to be able to produce that yourself and/or only rely on specific allied countries for supplies, at least for some quantity
-Environmental concerns about production practices elsewhere for some people can justify tariffs or import bans from some places
-"human right" & "workers rights" concerns about production practices elsewhere for some people can justify tariffs or import bans from some places
-Tariffs & import bans can be used as sactions for enemies and/or countries that behave "badly"
-"dumping" (the deliberate selling of goods below production costs to try to cripple producers elsewhere and then raise prices after others have failed) concerns for some people justify tariffs or import bans from some places
Each and every one of those considerations isn't objectively quantifiable in any sense, so it's a matter of how much you care about those issues and/or believe those issues exist in the first place and require addressing
3) Some tariffs have clear winners and losers, and not even just in the "domestic producers vs domestic consumers" sense, sometimes it's about producers vs other producers (a tariff on raw vegetables gains money to farmers but loses money to companies that use vegetable to make food or meals). This might be an "obvious result" but it's not obvious politics, so you have groups with incentives to warp the conversation toward tariffs or against them using 1) and 2) considerations, "models" and so on
I am not one of youse guys. I am not a fan of tariffs.
Currently only Trump is talking about adding massive tariffs (to pay off the deficit or something something)
What does matter more, what you talk about or what you actually did for 4 years?
Trump introduced tariffs, Biden kept most of them (and they accrued MORE MONEY during Biden years than during Trump years, ie more taxes on consumers), and afaik Harris never said she wants to remove the Trump-Biden tariffs
Conservatives historically have been against tariffs and bariers to free trade. They are shifting to a more isolationist low education white party.
You are mistaken.
Reagan for example often used a strong rethoric in favour of free trade (unlike Trump), but he introduced insane tariffs and import quotas.
Read this from 1988 about how Reagan in practice embraced protectionism very often (and from the start in 1980).
Japanese (the "China" of that era) cars, semiconductors, motorcycles were hit a lot, as well as a plethora of other trade restrictions all over the world
https://www.cato.org/sites/cato.org/file...
While the USA-Canada free trade agreement in 1988 found little opposition afaik, NAFTA got a lot of NO votes by both democrats and republicans in the house and the senate (only barely getting the 60 votes there)
The consensus on tariffs is easy to find. It would be beneficial for you to be able to research this yourself. Could help you learn logic and other stuff you try to understand.
There is a consensus among economists that introducing tariffs costs money in the present, that it decreases the quality of life of people, yes.
There is no consensus about everything else related to tariffs because those are political considerations not "scientifical" ones, including the idea that you might need tariffs for emergent sectors in some cases if you are a latecomer otherwise you never develop domestic production of that good (which might or might not be relevant for non-economic reasons).
as far as I think i understand, if you have an actual PLAN to create in house and goods or whatever it may be. then tariffs can be bad shorterm but good long term since it just starts up internally
Yeah, if you want to implement tariffs you need a very specific reason, and most economists were skeptical the reasons ever made sense.
The point is that the free trade ideal was tightly linked to core tenets of a conservative approach. From 1981 through 2016, although the pursuit of free trade was more pragmatic than pure, with multiple exceptions, there was a strong sense that the exceptions needed to be justified. They were, in fact, exceptional. And they stood out against a backdrop of major initiatives to liberalize trade and bolster the institutions of an open trading regime. These initiatives ranged from the Uruguay Round of trade talks launched under President Reagan and pursued under President George H. W. Bush, to a long string of bilateral or plurilateral free trade agreements and bilateral investment treaties, to the Doha Round of global talks launched under President George W. Bush.
The Trump broad tariffs are much more likely to be a disaster and not easy to unwind. That's one of the conclusions of modern economics I trust because you can see it clearly in just game theory toy examples.
Yeah, if you want to implement tariffs you need a very specific reason, and most economists were skeptical the reasons ever made sense.
The Trump broad tariffs are much more likely to be a disaster and not easy to unwind. That's one of the conclusions of modern economics I trust because you can s
im not sure why you would place heavy lots of tariffs if you didnt have a plan b already in the works.
I do agree that the "we rely way too much product x from country y so we must tariff" doesnt soudn terrible but needs to be follow up further with actions
its where the repubs kinda fumble with their healthcare especially, on poaper i get what they are saying wrt privatizing it but they dont want to break apart lobbying. breka apart certain restrctions due to lobbying. or letting actual competition from country x and y take place, etc etc if youre unwilling to break down the fundamentals then why just say lets do this and then thats that with no real plan
its where the repubs kinda fumble with their healthcare especially, on poaper i get what they are saying wrt privatizing it but they dont want to break apart lobbying. breka apart certain restrctions due to lobbying. or letting actual competition from country x and y take place, etc etc if youre unw
They're not really fumbling at least from their perspective--they know exactly who benefits in these scenarios. And the policy they're suggesting is a gift to them. A true fumble would be coming out and saying directly who wins/loses up front. Getting into too much detail on the sales end would be the bad play. The bloodletting starts after the sale when the details are getting hammered out.
So it should be easy to refute him point by point. I just read the article and have no idea if he is right. But he does go into technical detail and seems to back up his contentions in a reasonable manner. To dismiss him because he backs that Project 2025 should not be acceptable.
I read the first part of the article and did not care to read further because his arguments cherry pick information that helps his argument while ignoring information that counters it. For example:
The basic premise is that domestic production has value beyond what market prices reflect. A corporation deciding whether to close a factory in Ohio and relocate manufacturing to China, or a consumer deciding whether to stop buying a made-in-America brand in favor of cheaper imports, will probably not consider the broader importance of making things in America. To the individual actor, the logical choice is to do whatever saves the most money. But those individual decisions add up to collective economic, political, and societal harms. To the extent that tariffs combat those harms, they accordingly bring collective benefits
The author is arguing that tariffs bring the positive externality of more domestic jobs, neglecting facts like A) many products (like coffee, tea, bananas) cannot be produced at scale domestically, and B) many domestic manufacturing jobs rely on assembling imported goods/materials and then exporting them. The result from scenario "A" is higher prices with no job growth. The result from scenario "B" is the "downstream" domestic manufacturers end up in a huge disadvantage on global markets.
I don't know if the author is blind to his own cherry picking or is deliberately intellectually dishonest, but either way the article is imo not worthy of further consideration.
I believe the Atlantic leans left.
Oren Cass has no formal training or education in economics or macro factors so some left leaning columnist throwing his opinion into the fray to collect a pay check seems like a distinct nothing burger
Oren Cass has no formal training or education in economics or macro factors so some left leaning columnist throwing his opinion into the fray to collect a pay check seems like a distinct nothing burger
Now do every major media company article about anything in the last decades, the vast majority of which are intended to push leftist topics, and you might start to understand what we have been talking about for a while
Now do every major media company article about anything in the last decades, the vast majority of which are intended to push leftist topics, and you might start to understand what we have been talking about for a while
Something like 85%+ of our mainstream media is owned by Republican Billionaires. You are crazy if you think media has a leftist slant in the US.
Actually not crazy, just actively obtuse
I believe the Atlantic leans left.
You should probably look at the author more than the newspaper.
Oren M. Cass (born 1983) is an American public policy commentator and political advisor.[1] Since 2024 he has served as the chief economist at American Compass, a conservative think tank. He previously worked on the presidential campaigns of Mitt Romney in 2008 and 2012, being described as a "general policy impresario of the emerging conservative consensus on fighting poverty".[2] Between 2015 and 2019, Cass was a senior fellow at the Manhattan Institute for Policy Research, and he was the author of The Once and Future Worker: A Vision for the Renewal of Work in America.[3] In February 2020, Cass established American Compass, an organization aimed at the question of "what the post-Trump right-of-center is going to be.”[4]
"At the same time, high tariff protectionism continued to attract rent-seeking interest groups. The sheer extravagance of the public corruption around tariff schedule revisions came to a head in the late 19th century, eventually leading reformers to call for the abandonment of a tariff-based revenue system. Since tariffs were ostensibly a revenue device under the Constitution, swapping a different federal tax system would obviate the need for their continuation and thereby break the protectionist interest group coalition. This was the primary argument behind the federal income tax movement that eventually carried the day in 1913."
I could see Trump tying tariffs to NATO countries that have not fulfilled their 2% which puts Canada in for some hurt
For true liberals it isn't but this isn't the same Democrat party that sticks up for blue collar workers anymore. I mean they have the Cheney's on their side now - just a bizarre world we live in.
Tariffs don't work in the sense that the producer of a targeted commodity can can simply shift the production of that commodity to a third country. If the US places tariffs on widgets from China, the Chinese producer of widgets can move production to Vietnam and export them from there. The US would then have to place tariffs on Vietnamese widgets as well, and so on.
But that's not even the worst part.
Say Apple and Huawei both sell smartphones of comparable quality in the US for $100 each. Suppose the CEO of Apple was a major donor to the president's campaign, and would now appreciate some reciprocity for his trouble. No problem, says the president. BAM, a 100% tariff on Huawei smartphones, which now cost $200 vs Apple's $100 phone, tanking Huawei's sales and boosting Apple's US market share because consumers prefer the less expensive option. Except, the CEO of Apple is a clever guy who realizes that he can raise the price of Apple phones and still remain the less expensive option. He raises the price of his phones to $180 and still enjoys strong sales vs the $200 Huawei phone.
Oh, and btw, the Chinese government can play hardball, too. It places retaliatory tariffs on U.S. soybeans. Now farmers across the American Midwest are scrambling to find new markets for their product. Their revenue drops, so they cut back production and lay off their employees, who are now out of work.
CEO: 1, Joe Consumer: 0, American worker: neutral
Tariffs cause inflation and economic inefficiency (aka deadweight loss). Their benefits are mostly a wash because by raising the cost of certain primary products (let's say aluminum) they hurt domestic manufacturers who rely on those upstream inputs (let's say automobile manufacturers). Tariffs work if your goal is cronyism. They serve mainly to protect specific domestic industries from foreign competition. So much for free-market values!
"But wait!" says the president. My genius plan is to replace income taxes with tariffs as a means of generating government revenue. "You're welcome!"
"Thanks," says anyone in the ~middle class and above, who see some nice tax cuts to offset the inflation of goods. "Thanks for nothing!" scream the working class, who make so little income that they paid little in taxes to begin with, and therefore see no benefit even though inflation is killing them.
Tariffs aren't just stupid, they're also regressive. Anyone who pushes them as a panacea should learn some history about the pre-Bretton Woods era.
just amazing you wrote an entire theoretical about tariffs and ignored that china has thousands of tariffs on basically everything we do and have had them forever
ignoring that reality is like saying "don't get raped" as advice to potential rape victims
just amazing you wrote an entire theoretical about tariffs and ignored that china has thousands of tariffs on basically everything we do and have had them forever
ignoring that reality is like saying "don't get raped" as advice to potential rape victims
hm no because chinese tariffs damage chinese customers and the "retaliation" only damages your own customers.
It's chinese people who get raped by their government tariffs not us.
Tariffs don't work in the sense that the producer of a targeted commodity can can simply shift the production of that commodity to a third country. If the US places tariffs on widgets from China, the Chinese producer of widgets can move production to Vietnam and export them from there. The US would
So again I say that if you disagree with these conclusions, (opposite to the paper which made me say it the first time) you better be able to refute specific points he is making or bring up things he is leaving out.
1) The result isn't obvious at all because the world isn't made up of 2 countries setting tariffs with each other (see for example the idea of the targeted country setting up business in Mexico)
1bis) The result isn't obvious IN GENERAL because you don't only have your own producers competing with a
So you are essentially saying that is is similar to the three body problem in astronomy which is so ultra sensitive to initial conditions that nobody can be sure they are predicting the consequences correctly. Makes sense to me and also answers my original question. But now I ask why all these supposed experts weigh in on the subject with such a high degree of certainty rather than invoking your points and admitting that there is a good chance they are wrong. (Actually I know why but it does me no good to say it.)
