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| ▲ | bennyHHW 3 days ago | parent | next [-] | | [flagged] | |
| ▲ | reliabilityguy 3 days ago | parent | prev | next [-] | | > Trump is out there creating the most regressive tax system via tariffs Tariffs incentivize domestic production. See the case of chicken tax and pickup trucks. While we do pay for tariffs now, later down the road we should not as more things would be made domestically. If you don’t do tariffs, there is no way to force producers to onshore. | | |
| ▲ | toast0 3 days ago | parent | next [-] | | The chicken tax encourages creative workarounds more than domestic production. Importing all the parts and putting them together in the US is production work, so fine. Importing chassis cab and putting a bed on in the US is silly, importing with seats discarded in the US is wasteful (Ford got dinged, but I don't think others did?) Who's making small cargo vans domestically? Nobody. So they're all 25% more expensive, so you might as well buy a big cargo van when a small one would do. Honestly, governments buy enough light trucks, that 'buy american' requirements would likely keep at least one company making them here. | | |
| ▲ | reliabilityguy 3 days ago | parent [-] | | Chicken tax was introduced earlier than all the “relaxation” of what is considered “American”. The definition of “made in USA” became more flexible for products to be considered domestic while de facto being made somewhere else, hurting domestic manufacturing. So, it’s not that the tax doesn’t work, the issue is all the things around it that made it less effective. | | |
| ▲ | toast0 3 days ago | parent [-] | | Chicken tax was enacted in 1964; Ford and Chevy were tariff engineering in 1972, importing trucks without beds and putting beds on in the US. Finding loopholes and driving trucks through them is what's considered American. It's not a relaxation. At the end of the day, the chicken tax reduces our options in the vehicle market as it was designed to do, and it's one thing if we want to exclude WV vans and trucks when we have plenty of nice options at home, but now that we don't have nice options at home, it would be nice to be able to import them without a punative tariff. |
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| ▲ | JumpCrisscross 3 days ago | parent | prev | next [-] | | > Tariffs incentivize domestic production Stable, long term tariffs. We’re seeing historic falls in manufacturing employment for a reason. | | |
| ▲ | reliabilityguy 3 days ago | parent [-] | | > Stable, long term tariffs. Well, you have to start somewhere. > We’re seeing historic falls in manufacturing employment for a reason. In your opinion, what is this reason? | | |
| ▲ | JumpCrisscross 3 days ago | parent [-] | | > you have to start somewhere There has been no start. You don’t build a factory because the President announced a tariff that he is also negotiating a trade deal around. > what is this reason? I’m remodelling my deck. I had orders into a steel mill in Utah. Tariffs mean their steel inputs are pricer than competitors in Vietnam. So I switched the order. And I paid with a cheque—if I paid cash I could skip taxes altogether. That wasn’t a thing six months ago. Meanwhile, software and services aren’t tariffed. Just goods. Guess whose cost of capital has sunk. | | |
| ▲ | reliabilityguy 3 days ago | parent [-] | | > There has been no start. You don’t build a factory because the President announced a tariff that he is also negotiating a trade deal around. You absolutely do once the math of tariffs makes your manufacturing abroad not competitive with onshored one. Will it apply for all categories of products? Probably not. However, it will definitely apply for many. I am not sure I understood your reply about the reasons. | | |
| ▲ | JumpCrisscross 3 days ago | parent [-] | | > absolutely do once the math of tariffs makes your manufacturing abroad not competitive with onshored one If someone bet on e.g. our Japan tariffs three months ago, they lost money. (Nobody did. The types that take Trump at his word on tariffs aren’t making economically significant decisions.) | | |
| ▲ | reliabilityguy 3 days ago | parent [-] | | I do not know why anyone would bet that the executive order defined tariffs would stay. It was and still clear as a day that Trump uses them to force people to the negotiation table. Obviously, negotiated deal may look different. Regardless, tariffs as an instrument have their merit with Trump or without Trump. Strategically, US has to bring manufacturing (and as much of a supply chains) back, there is no way around it. | | |
| ▲ | JumpCrisscross 3 days ago | parent | next [-] | | > do not know why anyone would bet that the executive order defined tariffs would stay If nobody bets on the tariffs staying then manufacturing doesn’t come back. The restoring of manufacturing is the bet. > US has to bring manufacturing (and as much of a supply chains) back Sure. These tariffs don’t do that. | | |
| ▲ | reliabilityguy 3 days ago | parent [-] | | > Sure. These tariffs don’t do that. How do you know? Are you from the future? | | |
| ▲ | JumpCrisscross 3 days ago | parent [-] | | > Are you from the future? …we are currently in the future of the previous tariffs. Also, come on, you’re yourself arguing these tariffs aren’t worth betting on. What do you think investing in a factory is? | | |
| ▲ | reliabilityguy 3 days ago | parent [-] | | > …we are currently in the future of the previous tariffs. Which ones? > Also, come on, you’re yourself arguing these tariffs aren’t worth betting on. What do you think investing in a factory is? I can’t bet on negotiation tactic, only on the outcomes and formal agreements. As soon as those would be finalized we would know. Now we do not know how the trade policy would look like. I would assume that investment banker knows the difference. | | |
| ▲ | JumpCrisscross 3 days ago | parent [-] | | > Which ones? Liberation Day. > can’t bet on negotiation tactic, only on the outcomes and formal agreements How about money actually invested [1][2]. [1] https://fred.stlouisfed.org/series/C307RX1Q020SBEA [2] https://fred.stlouisfed.org/series/C307RX1Q020SBEA | | |
| ▲ | reliabilityguy 3 days ago | parent [-] | | > Liberation Day. From four months ago? | | |
| ▲ | sjsdaiuasgdia 3 days ago | parent | next [-] | | I can't tell which of these you meant - "From four months ago? That's way too short a time for any tariff impacts to show up." vs "From four months ago? That's ancient history, it doesn't matter." If it's the first, the link the other person provided shows a dip in manufacturing facility investment over the last 2 quarters. Maybe there will come a future point of stability where investors can feel confident, maybe not. Trump seems willing to use tariffs as a weapon for any disagreement with other countries, not just trade imbalances. There's little guarantee any trade agreement will be honored by the administration. If it's the second, well, that's the problem. The tariff landscape has been in constant flux over the last several months [0,1,2]. You don't build a factory overnight. You want to understand what your supply chains and costs look like and have some confidence in what they'll look like by the time the factory is ready to start producing. There remains little guarantee that the landscape won't continue to change, and Trump's weaponizing of tariffs is part of that. [0] https://e3.365dm.com/25/04/1600x900/skynews-trump-tariffs_68... [1] https://news.ucr.edu/sites/default/files/styles/scale_825/pu... [2] https://www.crugroup.com/globalassets/campaigns/commodity-ma... | |
| ▲ | JumpCrisscross 3 days ago | parent | prev [-] | | > From four months ago? That is when that was. Also the ones from six months ago. |
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| ▲ | 9rx 3 days ago | parent | prev | next [-] | | > Strategically, US has to bring manufacturing (and as much of a supply chains) back, there is no way around it. Strategically, it needed to keep manufacturing. It is too late now. Its labor and capital is already fully deployed towards innovation. Innovation that is now realizing that it is being stifled without a local manufacturing base, granted, but at this point pulling labor and capital away from innovation in order to build a manufacturing base again will only stifle it further as the rest of the world, which is quickly closing the innovation gap, keeps moving forward. The US cannot afford to see that happen. So, in order to save face, what the tariffs will end up doing is open the doors for foreign capital and labor to flood into the US instead. While that will put factories in eye's view, it does not "bring back manufacturing" or resolve the strategic need. It merely lets what was strategically trying to be defended against inside the house, which is an even worse position. | |
| ▲ | gambiting 3 days ago | parent | prev [-] | | >>Regardless, tariffs as an instrument have their merit with Trump or without Trump. Strategically, US has to bring manufacturing (and as much of a supply chains) back, there is no way around it. Well no. Not really. Not for everything anyway. Some things like electronics - sure, but it's a matter of national security not economy - it doesn't have to make financial sense, it just has to exist so that the country can have that ability no matter what happens. As a simple(and really oversimplified) example - let's say that tariffs force clothes manufacturers to bring tshirt making back to the States. The $5 T-Shirt now costs $30 due to tarrifs. So ok, someone makes a factory in US because now it makes sense, employs american workers, pays them good wage - ok, now they make t-shirts cost $20 because they are made domestically. Cool - that's great, but now the rest of the world still buys $5 tshirts, while Americans buy $20 ones that can't even be exported anywhere because why would anyone buy them if they have cheaper alternatives. All you've done is you increased the cost of your products to the american consumers. Some can argue - ok, that doesn't matter, what matters is that manufacturing is now back in the states and american people have employment. And sure, there is merit to that argument - but it reminds me of how my own country used to work under communist rule, people would go "comrade party leader, people have no jobs", "ok, we'll build a factory here so you can have jobs". Can the factory make anything that is actually worth making? Doesn't matter, what matters is that people got jobs and "manufacturing is happening here" - for an economy based on capitalist principles, that sounds like a disaster for US. But hey, what do I know. Just an external observer. | | |
| ▲ | reliabilityguy 3 days ago | parent [-] | | > Well no. Not really. Not for everything anyway. So, you and I are in agreement that for some things it makes sense, right? Both strategically, and economically. | | |
| ▲ | amanaplanacanal 3 days ago | parent | next [-] | | For some things, it might make sense. Across the board tarrifs like this current administration is doing them is just idiocy. | |
| ▲ | sethammons 3 days ago | parent | prev [-] | | Nearly every economist agrees with targeted and strategic tariffs. Nearly every economist disagrees with blanket tariffs. They think this for reasons. Historic ones. Logical ones. Modeled ones. Do some basic research. Talk to an AI. This is not advanced material. |
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| ▲ | Hikikomori 3 days ago | parent | prev | next [-] | | Long term stable tariffs yes. But you can't pretend like trumps tariffs were not done in the worst way possible? | | |
| ▲ | reliabilityguy 3 days ago | parent [-] | | Trump uses wild % amounts as a negotiation tactic. Is it the best way to do it? I don’t know. You can’t argue though that it does force the other side to come quickly to negotiation table to talk about the deal. So, if the goal is to get the deal now, then it’s effective. If the goal is something else, then it’s not a good tactic. I do not have enough information to definitely say whether it’s good or bad. Most of the things in life are neither because they have good side effects, and bad side effects to them. So, I think looking for a “good only” solution is a loosing strategy. | | |
| ▲ | amanaplanacanal 3 days ago | parent | next [-] | | I'm confused. Is the goal the get manufacturing back in the US, or to make new trade deals? I've heard both things. Oh, and something about fentanyl coming in from Canada? Alright I'm not sure how tariffs would stop that. | |
| ▲ | agent_turtle 3 days ago | parent | prev | next [-] | | > I do not have enough information to definitely say whether it’s good or bad. Usually when I don't have enough information on an issue, I take it upon myself to learn more about it before stating an opinion. > Most of the things in life are neither because they have good side effects, and bad side effects to them. You don't have to be a doctor to understand that the downside of cancer probably outweighs the upside of not having to save for retirement. Economic instability is the cancer in this metaphor, and the cause of it is Trump changing his mind on tariff rates every other day. Economists, like doctors, are trained on how to treat this illness, and all of them are saying "stop doing that". Trump can either listen to the experts or continue on his path, destroying the American economy in the process. | |
| ▲ | fireflash38 3 days ago | parent | prev | next [-] | | You're talking out of both sides of your mouth. You say we need tariffs to bring manufacturing back. Then you turn around and say the tariffs aren't the point, it's the deal. You even said it was silly to bet on announced tariffs elsewhere. If the tariffs are necessary to bring manufacturing back full stop, then you don't need to "make a deal". If it's just a tool to make a deal, then they're not necessary! You just keep moving those goalposts. | |
| ▲ | Hikikomori 3 days ago | parent | prev [-] | | Negotiate what? You realize they can just set it right? If it was a long term strategy they would just set a fixed % and leave it at that, otherwise companies cannot make any plans. |
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| ▲ | wat10000 3 days ago | parent | prev | next [-] | | When tariffs are imposed by the other side, they’re called “sanctions” and are considered one step short of declaring war. If they’re so great then they wouldn’t be used as punishment. Economists pretty much universally agree that tariffs are bad for both sides. It can make sense to use them to preserve strategic industries even if it’s less efficient economically. For example, tariffs on food could make sense to ensure an enemy can’t starve you with a blockade. But as a blanket policy it’s just bad. | |
| ▲ | dgb23 3 days ago | parent | prev | next [-] | | Only sector targeted tariffs paired with long term investment and commitment do that. | |
| ▲ | watwut 3 days ago | parent | prev [-] | | That particular outcome is possible when you make tariffs in a smart and predictable way. Trumps tariffs are unpredictable and also make local producers pay more for raw material they need. | | |
| ▲ | reliabilityguy 3 days ago | parent [-] | | > That particular outcome is possible when you make tariffs in a smart and predictable way. You would have to prove that claim. There is more than one way to achieve a specific goal. > Trumps tariffs are unpredictable and also make local producers pay more for raw material they need. It’s one of the consequences. There are other ones. Is your only objective is to ensure that local manufacturers pay the least amount possible for their raw materials? This is very simplistic view of things. | | |
| ▲ | amanaplanacanal 3 days ago | parent | next [-] | | This isn't rocket science. If you want somebody to spend a lot of money and time setting up production in the US, tariffs have to be stable and predictable. If that doesn't make sense to you, I didn't know what to say. | | |
| ▲ | reliabilityguy 3 days ago | parent [-] | | And they are after the deals are signed, no? | | |
| ▲ | notahacker 3 days ago | parent [-] | | A lot of deals got ripped up on "Liberation Day", including some Trump was extremely proud of when he announced them in his last term. He's changed his mind several times in six months already, dropping deadlines and tariffs when the market gets itchy feet, imposing higher tariffs due to disputes with governments completely unrelated to trade. He loves to make grand gestures to distract from domestic issues, and his administration showed so little basic competency they actually publicly announced tariffs on uninhabited territories full of penguins. Why would anybody assume stability? To echo a comment made in a parallel thread, decisions made to invest in US manufacturing don't get made by people dumb enough to take Trump at his word. And even if he wasn't tariffs are unlikely to persist at those levels under the next President, regardless of who that is, and that's the sort of timeline you pay back your investment in US manufacturing over... |
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| ▲ | watwut 3 days ago | parent | prev [-] | | You are the one who is making the claim that goes both against what historical data show and against what economists say. So, yeah, predictability matter. Institution do not want to invest based on something that goes up and down randomly. > Is your only objective is to ensure that local manufacturers pay the least amount possible for their raw materials? This is very simplistic view of things. Well, yeah, them paying more is rather massive obstacle. You know what is simplistic view of things? Belief that Trump will make economy better, because you like his fraudster personality and would like to be like him. |
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| ▲ | WalterBright 3 days ago | parent | prev [-] | | > Republicans passed the largest tax cuts for billionaires There were no tax cuts for billionaires in the BBB. (Not increasing the tax is not a "cut".) | | |
| ▲ | kyralis 3 days ago | parent | next [-] | | It absolutely is when the status quo would have increased taxes. That may not be a cut of current taxes, but in the longer timeframe it is absolutely a tax cut. | | |
| ▲ | WalterBright 3 days ago | parent [-] | | Framing it as not increasing taxes being a cut is misleading. It's just as disingenuous as scaling back a proposed budget increase and calling it a "cut". The FTC wouldn't let businesses get away with such language, why should the government get a pass? | | |
| ▲ | tired-turtle 3 days ago | parent | next [-] | | If a bill due at the end of the month is forgiven on the 25th, were expenses cut? What if the debt is forgiven on the 2nd of the next month? I’d wager most people would consider those scenario cuts. However, in your framework, the verbiage is different despite a shared outcome. | | |
| ▲ | WalterBright 3 days ago | parent [-] | | Bills are not due in advance. The analogy is inapt. The taxes were cut 8 years ago. There aren't further "cuts". Billionare tax rates have been the same for the last 8 years, and will continue at the same rate at least into next year. | | |
| ▲ | wat10000 3 days ago | parent [-] | | Weren’t those cuts set to expire? | | |
| ▲ | amanaplanacanal 3 days ago | parent [-] | | Yes. They were temporary cuts so that they could claim they didn't raise the deficit. Now they are claiming that everybody knew they were going to be permanent. So they either raised the deficit in that cut, or the current one. It's the same party, claiming they didn't raise the deficit either time. And Americans put up with this shit. |
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| ▲ | kyralis 3 days ago | parent | prev | next [-] | | No. The total tax bill over the next five years was X, given the current laws. Then a bill was passed that reduced that total tax bill over the next five years. This is a tax cut. It's a little absurd to try to claim otherwise. | | |
| ▲ | WalterBright 3 days ago | parent [-] | | Failing to increase taxes is not a tax cut. | | |
| ▲ | kyralis 14 hours ago | parent [-] | | This is the same as saying that a tax cut with an expiration date should be treated as if it were permanent. Are you not aware that these things are different? That there is a difference between an adjustment to a proposed budget and a budget that has been enshrined in law? What's the magical time horizon that changes this? If I change the taxes due for 2026, is that a tax cut? How about 2027? Where's the line between a change in law that is or is not a tax cut with this philosophy? If you want consistency, a change in law that adjusts the tax burden downward from what the burden would be without the change in law is a tax cut. Therefore, a change in the law that makes previously temporary reduced tax levels into permanent reduced tax levels is a tax cut. |
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| ▲ | 3 days ago | parent | prev [-] | | [deleted] |
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| ▲ | amanaplanacanal 3 days ago | parent | prev [-] | | They made a temporary cut permanent. Come on, you already know this. And you know why. | | |
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