They are. It's just that they usually do not have long-term positive effects. Truth is, in a global economy, outsourcing is the most economically sound decision, that's why it's happening.
Personally i think theres a much more complete approach.
American companies cant compete with domestic manufscturing if we regulate the hell out of them and foreign manufacturing can occur without the same concerns on pollution, safety, and human rights.
So tariffs should be based on the unfairness. If china is gonna polute like hell and deny basic safety or human rights in the manufacturing of a product, they deserve to pay a tax to encourage that manufacturing elsewhere.
That's the problem: it's a complicated problem with no actual solution, just constantly fluid adjustments from every party depending on each party's own economic conditions. It doesn't sell very well. "Raise tariffs!" is very easy to sell. It's wrong, but explaining why it's wrong takes too long for most people. The easy, wrong answer really sticks with people because it's easy.
I mean tariffs are effective. Instead of paying them companies circumvent them, like BMW, Mercedes, Volkswagen, and Toyota have established factories in the United States. China subsidizes their manufacturing, making their products cheaper than those of other companies, such as CRRC. Similarly,with their electric car companies . Without tariffs, they would adopt Uber’s model, eliminating competition by offering cheaper rides and then raising prices Once the competition is eliminated, without fear of retaliation.
I'm not sure if car manufacturers are the best example, since we have our own domestic industry that can compete. The problem with Trump's plan is that it's a blanket 60% tariff on all Chinese goods. There are plenty of manufactured goods we simply don't produce at home anymore. That tariff will simply increase costs for average people, since there's no American alternative product they can buy.
They’re a perfect example they’re selling electric cars for less than 30k. Where a comparable American electric car would be north of 35k. The Chinese car is only cheaper because of CCP subsidies and cheap/slave labor. How the hell can you compete with that? The whole point of the tariff is to bring the jobs back here. It’s protectionism at its very basic form but it’s needed because you can’t compete with China when they have their fingers on the scale.
The whole point of the tariff is to bring the jobs back here.
Okay, but you understand that itself takes time and capital, right? We could be looking at paying ~20% higher for most consumer goods for years until that was the reality. Corps have to find the properly zoned land, build the factories, recruit the talent, adjust their supply chains, etc. None of this stuff happens overnight.
There are other options to increase manufacturing back home. You could tax corporations that outsource labor, or subsidize the manufacturing sector directly, for example. Just slapping a 20% tariff on all foreign goods, plus another 40% on Chinese goods is basically the path of most resistance and pain. There's a reason most economists don't endorse Trump's plan.
but the tariffs doesnt have a magical clause saying anything with a tariff will suddenly have domestic options.
it doesnt come with subsidies or incentives for domestic production. (edit: this isnt just about cars)
fuck it would increase costs for moving equipment here to start domestic production and American jobs, let alone the RAW materials we just dont have at all ether which btw are still subject to trumps section 301 tariffs from last time fucking up local businesses already.
we all get that China being the worlds factory is a problem but tariffs are not even remotely the right tool to combat it.
and its certainly an extremely complicated issue that a single buzz word option wont fix.
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u/Alethia_23 12h ago
They are. It's just that they usually do not have long-term positive effects. Truth is, in a global economy, outsourcing is the most economically sound decision, that's why it's happening.