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Instant Inflation
Put some items in my Amazon cart last night, didn’t check out. Wanted to see if I still wanted them in the clear unsparing light of day. Called up the cart tonight, and every item – USB cords, a sweatshirt, a power converter – had increased in price by a dollar. The presumption, I gather, is that the replacement cost of the items will be greater in the future. It makes me want to scour Amazon for everything made offshore that I know I will need, and buy it now before the price leaps up again.
Published in Economy
I’m not either but he’s got less than four years to accomplish things, a small window for grand designs.
Does this “we” you keep speaking of include the people and communities devastated by loss of jobs to China?
Yeah, but if another country has a smaller population than us and is less wealthy than us (which is most countries), doesn’t it make sense they’re likely to consume less product from us than we are from them?
And I think he may blow all his grand designs with this nonsense.
Israel just last week removed all tariffs on imports from the US. Set them to zero.
Trump this week imposed a 17% tariff on imports from Israel.
Trumps program has no strategy, no plan, no rationality. It’s also (in my view, and if it ever gets there, probably the view of the Supreme Court) Unconstitutional. The “National Security” fig leaf he’s claiming can’t possibly apply to every country in the world. The Constitution is very explicit that Congress has the power to tax, not the executive, and we’ve all been cheering the last few years as the Supreme Court has been ruling again and again that Congress cannot delegate core powers to the Executive.
If we’re going to do Tariffs (a big if, although I will admit I’m much less of a free trade absolutist than I was in my youth), they need to come from an act of Congress, not from the whim of the Executive.
I think the “lost jobs” thing has been kind of a myth. The jobs that are supposedly lost to China have simply been exchanged for different jobs in the U.S. The U.S. has had some of the lowest unemployment numbers in the past ten years that we have ever had since they started measuring it. In fact we are in the midst of a 15-year shortage of workers. Just about anybody who wants a job can find one these days. What has caused the upheaval has been the radical shift of manufacturing to automated processes requiring fewer human beings, but creating more products. That puts a definite burden on those whose jobs were in the manufacturing industry, but whole new industries and other jobs have opened up to take their place.
It can be difficult for many people to adapt, but they can learn new skills and take the jobs that are available, which many employers are desperate to fill. This process has been going on since the dawn of civilization, though the changes seem like they are happening faster now.
But the supposed point that some people make is that the money we send to other countries is “worthless” unless it comes back to US. Which your example also disproves, but in addition, the numbers belie it – by $1 Trillion just in 2023 – and again, if that money ends up with China because those poor countries are themselves also buying cheaper stuff from China, then China certainly isn’t buying that much from US. Not even as much as we import from them, let alone what might be due to other countries. And to the extent that China is in effect using our own money to buy our debt and then we pay interest on it AGAIN…. that’s not good.
It’s more complicated than that, which you should know. Just for one, there are a lot of open jobs for which there may not be nearly enough QUALIFIED workers. Because they require degrees in engineering or something, which many people don’t have, and which many people couldn’t get no matter how hard they tried.
I’m not a tariff expert and worry about the current Trump tariff policy, but it does seem weird that so many are beside themselves the sky is falling that the US imposing tariffs which are actually less than other Countries tariffs have imposed on the US, in the negotiated hopes the other Countries will reduce their tariffs is a terribly destructive policy ….really … when you actually write it down the issue makes you wonder why the US had tolerated the status quo for so long.
What am I not understanding?
Maybe how easy it is for some people to become Chicken Little?
There is one unknown aspect of the tariffs that I will be interested to see. During the pandemic, many companies’ costs went very high. I heard a couple of commentators on Fox Business say at that time that the businesses were absorbing the increases to keep their prices stable.
If the tariffs are collected when the goods cross the border rather than when the goods are sold, companies selling within the United States could, in theory, absorb the tariffs and stabilize their prices.
That might work for a lot of them. They will lose some profits but not all of them.
The goods would go to the wholesalers who might reduce their prices a bit to absorb some of the new tariffs, leaving, say, only half of the tariffs for the retailers to absorb. That may be doable for businesses and work to the consumers’ advantage.
The other interesting response might be that the countries involved will eliminate the tariffs on U.S. goods being sold in their countries to (a) ensure their supply remains steady and (b) to get the tariffs removed on the goods they are trying to sell in the United States. In those situations, again, consumers won’t notice much of an increase, if any.
It’s not quite what you think. Here are the positions that have the most numbers of job openings in the U.S.
https://www.careeronestop.org/Toolkit/Careers/careers-most-openings.aspx
I’m not quite following your train of thought. Tariffs are imposed on the seller when they cross the border, not when they are sold to the consumer. And then how does the U.S. retailer absorb the price hike? Just by taking a financial hit for the benefit of patriotic Americans? That is asking a lot from millions of retailers, besides, what if the price hike is larger than their profit margin?
Again, you are asking a minority group – wholesalers and retailers, to absorb the financial losses for the majority of the country. Something tells me that is going to meet with disturbing resistance!
Well, that has been one of the biggest talking points of Trump supporters, and it sounds very reasonable and fair. However, before the Trump Tariffs were revealed on Tuesday, Israel announced it would drop every single tariff on products coming from the United States (their tariffs were insignificant to begin with), and Vietnam announced a drastic cut to its tariffs, also. Trump completely ignored this and slapped a 17% tariff on Israel and 46% tariff on Vietnam, thereby completely destroying the notion that these tariffs were meant to create free trade between our countries.
The problem that narrative is that in several situations the U.S. is not imposing tariffs that are less than other countries’ tariffs on the U.S., instead it’s the U.S. now imposing tariffs on other countries that are far higher than the tariffs they were imposing on the U.S. As Steven Seward mentions above we’re hitting Israel and Vietnam with tariffs right after they cut theirs. According to Trump’s chart the U.S. is going to be imposing a 25% tariff on South Korea even though South Korea’s effective tariff rate on the U.S. is only between .26 and 3.6% .
His tariff rate isn’t based on the actual tariffs other countries are imposing, but is instead being based on trade deficits. The “Charged Tariffs” numbers on his chart are garbage. So the idea that this is just us demanding fairness from other countries who’ve been tariffing the crap out of us doesn’t really hold up.
cEntRal pLAnNing MakEs oUr liVEs beTTEr
We could have propellerheads force everything around with colored pieces of paper.
cEntRal pLAnNing MakEs oUr liVEs beTTEr
Before the products are sold? That’s what I didn’t know.
I would think they want their prices to remain competitive. That’s why I’m wondering if only a small fraction of the tariff would be passed along to the consumer. They wouldn’t take the hit for altruistic reasons. I’m thinking they would take it to remain competitive.
I think part of what needs to happen is the bottom 50% of colleges need to tell the accreditation system to go screw itself. If you don’t want to take liberal arts classes, you shouldn’t have to take them. Or alternatively, they should be a lot cheaper.
I would imagine the administration will simply remove those tariffs then for Israel and Vietnam. That seems like a clerical error, easily fixed.
Explain.
We will switch to deflation the hard way. You can’t keep making this work.
No point in being competitive at a major loss. Lower losses at having no sales and attempting to wait it out.
Engineering Market in the Detroit Metro Area truly sucks right now. I think you should look at LinkedIN , Glassdoor, Indeed and ZipRecruiter before making these blanket statements . There are a ton of qualified people out there, and a shortage of jobs. Many of the same listings are getting posted over and over again. You have no idea about what you are talking about. And guess what — many employers are instituting hiring freezes until the tariff spasm blows over.
True. This is a fake emergency that is being used to justify emergency powers. There is no emergency. Similar to the abuse of power under Covid. At worst, we have a small chronic problem being treated as an emergency to get around congress and the constitution.
So the American People should be punished for not wanting Tariff Idiocy? You want pain for the American People?
Trump’s tariffs are not based on the target countries tariffs. They are based on balance of trade numbers. So target countries removing their tariffs will not necessarily get Trump to remove his. Trump’s tariffs may worsen the balance of trade, as citizens of other countries may decide to buy anything but American out of hostility. I know I have done my best to avoid Chinese goods for years.
I hope you are right, but presumably Trump knew about these when he touted his big list. The dropping of their tariffs to zero was big news, especially from Israel, our closest ally, and Elon Musk even tweeted about it. And two days have past so far and no correction has been issued from the White House. As a matter of fact, that 17% is higher than the tariffs Trump imposed on several Arab countries, including Qatar, the biggest supporter of terrorist groups, among Arab countries. The fact that Israel had all but eliminated their tariffs on American products a couple of decades ago, made no difference. Israelis are fuming:
https://allisrael.com/israel-shocked-after-trump-slaps-17-tariff-on-israeli-imports-finance-ministry-to-analyze-implications
Yes indeed.
I don’t wanna get all art-of-the-dealy here, not least because I’ve never read the book, but surely one reason to whomp up a big fat tariff is the joy of hanging out by the phone waiting for nations to call you up to talk you out of it using persuasive techniques like canceling the tariffs they have been using against you for decades.
And fwiw, our nation was founded on a 5% tariff.
I could go for that if we had actual high school standards required for college entry – literacy and all that stuff.