Why Trump's tariffs will work.

[Woodznutz]

Congressional budget office

What actual evidence is there that is the case? Why jump to this conclusion first, instead of assuming the actual convicted felon who fired them in the first place, is the one is obvious looking to take advantage here.

My default position, based on 65 years of experience working with others, is that there is waste, fraud, and abuse even in the IG's offices.

 

[Woodznutz]

tariffs high enough to pay off the national debt would have a disastrous effect on the economy. Trump would need to put a universal tariff on every good coming into the states. Everything would more expensive for everyone. Consumer spending would drop, businesses will go bankrupt, countries will look elsewhere to export and import to. It's a moronic policy that only a buffoon like Trump would come up with.

I don't think Trump believes he will retire the debt in four years, but we need a good start. Slow spending a little, add a little more revenue, baby steps.

 

[frigidweirdo]

Many importers have production/manufacturing partnerships in foreign countries. They aren't simply "importers" who buy and distribute foreign made goods (like Pier One Imports). Tariffs will make them rethink their business plans and return some or all manufacturing back here. Those who chose to continue regardless of tariffs might strike deals with their foreign partners for lower prices to offset the cost of tariffs, or simply pay the tariffs and either pass some or all of the costs on or bear the costs themselves.

The upside of tariffs is that they can be used to reduce government debt, and regardless of higher prices the money remains in the domestic economy.

Economics for people who don't do thinking....

 

[elektra]

Canada is waiting before diversifying trade away from America and to China and other countries that are willing to engage in free trade practices.
It's seldom that Trump actually follows through on his threats.
Hopefully he does soon so Canada can move to increasing free trade relations with China and other countries that are anxious to take America's place and play fair.

Regrettably, it won't take very long for Trump to realize that he's shitting in his own nest.

Canada has tariffs on imports. Your idea that Canada wants free trade has no basis in reality

 

[Woodznutz]

Economics for people who don't do thinking....

The above was written by a self-made millionaire.

 

[frigidweirdo]

The above was written by a self-made millionaire.

The above was written by someone who said "this will tank the economy".

 

[Woodznutz]

The above was written by someone who said "this will tank the economy".

TBD

 

[hadit]

I don't think Trump believes he will retire the debt in four years, but we need a good start. Slow spending a little, add a little more revenue, baby steps.

And that only works if Congress is on board. It's great to take those steps, but we know the pattern. The next president will run on reversing them and spending even more to make up for the loss of program teaching clowns how to tie balloon animals and Congress will fall right in line, pumping the spending bills full of the usual carp.

 

[Woodznutz]

And that only works if Congress is on board. It's great to take those steps, but we know the pattern. The next president will run on reversing them and spending even more to make up for the loss of program teaching clowns how to tie balloon animals and Congress will fall right in line, pumping the spending bills full of the usual carp.

A good reason for term limits. Politicians get reelected by "bringing home the bacon". And of course, their constituents are waiting for it like pigs at the trough.

 

[MarathonMike]

All the Trump Haters seem to forget how much the Democrat Regime loved Trump's tariffs that WERE IN PLACE when Biden took office. Biden and the Democrats quietly kept them because of the many billions of dollars America was NETTING as a result of Trump's tariffs.

 

[Woodznutz]

Both McKinley and Roosevelt used them to very good effect. In fact, Teddy believed that America's economic growth was due to protective tariffs, which helped her industrialize. He acknowledged this in his State of the Union address from 1902:


View attachment 1068747

That was the thinking of Lincoln as well.

 

[Woodznutz]

Tariffs are fine if they produce the desired results, so the jury is still out on Trumps proposals. Just the threat of tariffs has already had some good results by bringing some businesses to the table. "Outrageous" first proposals are right out of Trump's playbook.

 

[multivita-man]

Many importers have production/manufacturing partnerships in foreign countries. They aren't simply "importers" who buy and distribute foreign made goods (like Pier One Imports). Tariffs will make them rethink their business plans and return some or all manufacturing back here. Those who chose to continue regardless of tariffs might strike deals with their foreign partners for lower prices to offset the cost of tariffs, or simply pay the tariffs and either pass some or all of the costs on or bear the costs themselves.

The upside of tariffs is that they can be used to reduce government debt,

A tariff is just another word for a tax, so if you think tariffs are good at reducing government debt (I don't really think they are), why not just raise taxes after income? That way you don't discourage trade.

and regardless of higher prices the money remains in the domestic economy.

The tax remains in the domestic economy. Like an excise tax but on imported goods.

 

[Woodznutz]

A tariff is just another word for a tax, so if you think tariffs are good at reducing government debt (I don't really think they are), why not just raise taxes after income? That way you don't discourage trade.



The tax remains in the domestic economy. Like an excise tax but on imported goods.

You only pay the "tax" if you buy the goods that the tariff is impose on. Raising income taxes affects everyone.

 

[multivita-man]

You only pay the "tax" if you buy the goods that the tariff is impose on. Raising income taxes affects everyone.

I understand that, but I was responding to the argument that tariffs raise revenue for the government.

I have repeatedly voted against MAGA but I have gone against the anti-Trump grain and argued that tariffs are not automatically a bad thing. A lot of libs on X, for example, bring up Smoot-Hawley, arguing that it "caused" the Depression -- it did not. It didn't help, but the Depression was already underway. In fact there's a long history of tariffs as econ policy in the United States - just not in the last 35-40 years.

My concern with Trump's tariffs isn't the tariffs themselves; it's that he's not really thinking about them strategically. This is just more of the same "I like tariffs so I'm gonna start slapping tariffs on all countries, especially countries that laugh at me. We'll see how much longer they laugh now, those bitches!" That's not really a grand macro-economic strategy.

If Trump were to say, "Okay, Mexico, look, I'm going to give you a year to solve our border and fentanyl problem to my satisfaction. Here's my border crossing and fentanyl traffic goals. I'm gonna raise tariffs 1% ever month until we get there." Or "I'll not impose any tariffs for a year but if these objectives aren't met, then 20% tariffs starting in 2026/2027. That would be smarter.

With Canada or Norway, we could say, "We want to build 40 ice-breakers. We don't have the state-of-the-art tech you do right now. We want you to help us manufacture these things. We'll give you 2 years to help us make X # of these things, or we begin raising tariffs"

 

[Woodznutz]

I understand that, but I was responding to the argument that tariffs raise revenue for the government.

I have repeatedly voted against MAGA but I have gone against the anti-Trump grain and argued that tariffs are not automatically a bad thing. In fact there's a long history of tariffs as econ policy in the United States - just not in the last 35-40 years.

My concern with Trump's tariffs isn't the tariffs themselves; it's that he's not really thinking about them strategically. This is just more of the same "I like tariffs so I'm gonna start slapping tariffs on all countries, especially countries that laugh at me. We'll see how much longer they laugh now, those bitches!" That's not really a grand macro-economic strategy.

Tariffs are paid to the Federal government. They can use it to retire debt.

I say give the tariffs a chance. If a trade war looms, they can be reconsidered. But, we can't continue to hemorrhage money to the global economy. The money leaves but the debt remains and grows. We can't borrow our way out of debt. Another thing to consider is that while the private sector has assets that appreciate, the government's "assets" fall into disrepair and lose value.

 

[multivita-man]

Tariffs are paid to the Federal government.

Correct. They are paid by U.S. importers, who either eat the costs or pass them on to consumers - or both.

I say give the tariffs a chance. If a trade war looms, they can be reconsidered.

Well a trade war is coming, most likely. And I say that because in the case of Canada and Mexico, we have now twice violated two free trade agreements (under Trump's direction). Sorry, but you can't break a decades-old free-trade pact and not expect our trading partners to *fight back. They will use their own leverage to retaliate. Justin Trudeau has already conceded that Canada is in for some economic pain but they are not rolling over -- and his political rivals, the conservatives, have already supported his position. There's political solidarity in Canada against the United States because this was completely unprovoked. Canada has accepted that it is, to a degree, fucked. Now it wants to fuck us back, and they seem ready to do so.

But, we can't continue to hemorrhage money to the global economy. The money leaves but the debt remains and grows. We can't borrow our way out of debt. Another thing to consider is that while the private sector has assets that appreciate, the government's "assets" fall into disrepair and lose value.

You're talking about two different things. Tariffs can't do anything about the national debt -- that's fiscal policy, not trade policy. Tariffs are about the balance of trade between two countries. Here's the really ironic thing about tariffs: if tariffs in the United States are more effective than we bargained for, and if they really hurt Canada's and Mexico's economies, we might end up with even a worse trade imbalance. Thus, there is a scenario in which tariffs actually backfire. That's because if our tariffs hurt Canada and Mexico's economies, we make their capital inflows (investment) less attractive and our foreign investment more attractive, which strengthens the US dollar and weakens their currencies.

*edited

 

[Woodznutz]

Correct. They are paid by U.S. importers, who either eat the costs or pass them on to consumers - or both.



Well a trade war is coming, most likely. And I say that because in the case of Canada and Mexico, we have now twice violated two free trade agreements (under Trump's direction). Sorry, but you can't break a decades-old free-trade pact and not expect our trading partners to accept it. They will use their own leverage to retaliate. Justin Trudeau has already conceded that Canada is in for some economic pain but they are not rolling over -- and his political rivals, the conservatives, have already supported his position. There's political solidarity in Canada against the United States because this was completely unprovoked. Canada has accepted that it is, to a degree, fucked. Now it wants to fuck us back, and they seem ready to do so.



You're talking about two different things. Tariffs can't do anything about the national debt -- that's fiscal policy, not trade policy. Tariffs are about the balance of trade between two countries. Here's the really ironic thing about tariffs: if tariffs in the United States are more effective than we bargained for, and if they really hurt Canada's and Mexico's economies, we might end up with even a worse trade imbalance. Thus, there is a scenario in which tariffs actually backfire. That's because if our tariffs hurt Canada and Mexico's economies, we make their capital inflows (investment) less attractive and our foreign investment more attractive, which strengthens the US dollar and weakens their currencies.

Tariff revenue lessens the need to borrow.

I agree that tariffs are a dangerous thing in the present global economy. Back in the early days of the country they were very useful. Still, we have the problem of trade imbalance that is killing us.

 

[multivita-man]

My own prediction is that all three countries - US, CAN, MX - will be negotiating to find a face-saving way out. The US will (soon, I think) realize that these tariffs aren't that strategic and even if people don't really notice them that much, they're not really delivering positive bang for the buck. So I think Trump will eventually look for an off ramp, and so will Sheinbaum and Trudeau.

But the latter (CAN and MEX) will need to score a victory. They can't just agree to end tariffs without some sort of political victory in hand, and that, to me, is the worrisome part: the possibility of trade/political tensions that fester because of the need to project strength in the face of American pressure.

 

[multivita-man]

Tariff revenue lessens the need to borrow.

Not really. Not when you have a military that wants military supremacy and energy dominance over rivals like China and Russia, and not when our population is rapidly graying. Whatever tariffs we collect won't in any meaningful way keep up with these trends.

I agree that tariffs are a dangerous thing in the present global economy. Back in the early days of the country they were very useful. Still, we have the problem of trade imbalance that is killing us.

I agree that trade imbalances need to be reconsidered. That is not at all a radical right-wing position. It's consistent with much of this country's history, in fact.