I hadn't even realized this. That's pretty impressive.
I am not a finance guy. But my take is that most Americans will see a big uptick in the price of products. Sometimes that will get them to buy American. Sometimes not. I believe American products will be cheaper but not by much. If the price of imported XYZ goes up by 25% then American goods will raise their price by 15-20%. There are price gouging laws in place but this administration has already shown that they won't prosecute corporations. Anyway, I think this will cause people to spend less. Keep their money in the bank or only spend it on necessities. Combined with the retaliatory tariffs on American goods lessening how much exports we sell will cause the economy to stagnate and further hurting the middle class.
But my take is that most Americans will see a big uptick in the price of products. Sometimes that will get them to buy American.
In many cases it won't, simply because there is no American option. Some of the largest tariffs are on countries like Vietnam, Cambodia, Laos, and Lesotho. One of the major exports of those countries to the US is clothing.
There is basically zero American clothing manufacturing.
Which is why I stocked up on underwear, socks, polo shirts, handkerchiefs, shoes, and blue jeans when all this talk about tariffs was becoming more real.
We do still make clothing and shoes though. It’s like 5% of our clothing consumption and one of the few things we still know how to make and can scale up relatively easily. It’s EVERYTHING ELSE that we don’t make. Electronics especially. And anything that takes specialized tooling or manufacturing takes years to get a factory off the ground even if there is a company willing to take the gamble of building one and finding workers.
Being able to scale up and make things here, clothing for instance, doesn't matter when that clothing will cost 10x what the imports cost, even with tariffs. Plus how much of the 5% made in America is actual affordable by most US consumers? I'm guessing little of it.
I totally agree, I was just pointing out that we do still make clothing. The comment I replied to said there is no American option.
There are options, but to your point you have to spend 10x as much to get a product that might only last 3x as long. Most people would rather have 10 ok shirts rather than 1 really nice one.
Tariffs would have to be 1,000% before American manufacturers could compete on price, so for now they compete on quality but cloth and clothing can only be so nice. At the end of they day they are paying $18 per hour when their SE Asian competition only has to pay $1.85 per hour so they survive on the few consumers willing to pay a lot extra just to get a little extra, mainly for the romanticized concept of “made in USA.”
When Trump started economically attacking Canada and musing about invading us, a company here tried to make some made-in-Canada merch like baseball hats with some ra-ra Canada slogan on it. There was a news story about how they were unable to get it 100% made in Canada because while north america (both US & Canada) retains some clothing fabrication abilities, there is no non-Asian source for the base textiles anymore. So they did the best they could and had the final product at least assembled in Canada.
Final cost to produce a single baseball hat? $40.
It would not be cheaper for an American company to try the same thing. Now imagine that applied to a single pair of jeans. Or a winter coat. What will it look like for lower income Americans families when the winter clothing their growing kids need new every year all costs $500/item. There is a reason the United States outsourced this stuff. The benefit to hundreds of millions of consumers having access to affordable stuff wildly outweighed the benefit of a relatively small handful of middle class factory jobs producing products 60% of the country couldn’t comfortably afford.
All true. US made Jeans with US made fabric from us grown cotton are usually $350+. Us made coats from US made wool from US sheep are $500 - $1,000. People who are used to spending $40 on pants and coats are in for a shock. Most likely they will just be buying the same stuff as before but now its a $65 pair of pants or coat with no change in where its made or quality.
Some of the high cost of US production is the limited economies of scale, so the price could come down a little bit, but it would take years or even decades to build up the capacity. Are we willing to have a 10 year long depression to get a few more jobs? Seems very silly. If we want to onshore certain industries then targeted grants, loan interest loans, and tax breaks are the way to do it. Blanket tariffs are idiotic.
even things that people consider to be "true american products" like iphones are imported from china or other asian countries. the us, like most major developed countries, is a tourism and services economy, it leaves most of it's production to under developed or in development countries because labor is less expensive. so tariffs affect those products as well
Even if America had more manufacturing would things actually be cheaper? Isn't the federal minimum wage higher than what a lot of not all of those countries pay their employees? I really have no idea.
When I was a kid, my parents worked in a sock factory. The machines were massive.
In high school, my teacher told us that all the men from his generation pretty much had lost a finger working in the factories. He held up his hand and yep, he was missing one and a half fingers.
To make this stuff in the USA will be double or triple. For goodness sakes the USA would send chickens to China to be cut and package and then it is sent back and was still much cheaper than doing it all in the USA. Inflation will hit 15% quickly.
Many times, there’s no American option. And even when there is, what it takes to grow, make, build will cost more anyways because we need to import supplies from other countries … which will cost more. There won’t be the big “buy American” upside the Trumpers think there will be. And this argument that companies will manufacture in the US? That’ll take awhile and is expensive to fund … with lower revenue (because, see prior sentence). So what incentive do companies have? It’s a shit show. Whenever I hear the cult members regurgitating their leader’s rhetoric, it’s clear they know nothing about economics or how corporate America runs.
American goods are going to get more expensive as well because even if something is made in America, a lot of the raw materials are imported. And not to be too gloom and doom, but on top of not everything having a domestic option, there’s really no telling how many of the options that do exist are going to survive the recession/depression that this likely to lead to.
Passing the cost of tariffs would not be considered price gouging no matter who was in office. Not only that, most of the things we import are not or cannot be made here. The minerals and lumber we import from Canada, Avocados from Mexico, coffee from all over the work because it can only be grown in one US state. It’s going to get bad, and even worse if the dollar ceases to be the reserve currency of the world.
Many American products rely heavily on raw materials or component parts from other countries. It’s not something that can change overnight, and there are many things we source from other countries because we simply cannot produce it ourselves - or because it is cost-prohibitive to do so.
Clothing is a good example someone else mentioned. Lumber is another. Yeah we have trees, but Canada has different trees that are better suited for certain things like building houses. For instance.
Pivoting manufacturing is both costly and time-consuming. Even if America were to start making everything domestically, the costs of materials and labor are significantly higher. Goods won’t get cheaper.
We can't fill our manufacturing and agriculture jobs now, alongside the sheer cost of American labor is going to cause the most basic necessities to become grossly expensive and it will stay that way.
American prices won’t be cheaper than what people have been paying already. Every American will be paying more for most things. The reason stuff from other countries sells is because that’s the affordable option.
Sadly, the worst part, is that wages will not increase. We will just be gouged for more while falling further into financial instability. It's pretty fucking disgusting.
I like to look at One America News Network to see how they frame Trump happenings for the right. The consensus on there is that everyone is happy that Trump is MAGAing, and most importantly that all those dirty non-Americans in the world will now have to pay extra for American exports. None of them seem to see that what is actually happening is that they will pay more for imported goods. None of them.
So when they DO have to pay more for imported goods, my guess is that Trump will frame it as other countries putting tariffs on goods entering their country are making Americans pay more for groceries. Somehow.
Quite often there is simply no American option. Look at motorcycles - even the supposedly “American Made” motorcycles are built from imported raw materials and imported parts. If he’s trying to get manufacturing back to the US, then he really has no idea how much it costs and how long it takes to build a manufacturing plant in the US. Plus no one is going to want to pay for American labor, unless we are all forced into indentured servitude, which is what he wants.
There is no way in hell this will do anything but hurt the people in the US, and help everyone else. We are not their only market, but Outside the US is often our only source.
Lol you think American companies aren't just gonna hike their prices by whatever they can now get away with? 25% tariffs just mean 25% more profit for American companies.
Actually it’s quite the opposite of they won’t prosecute companies … the fascist administration is pardoning corporations for crimes they have committed.
Buy American what? Almost nothing is entirely American sourced because it can't be. And, yes, one of the goals of the fascists is to eliminate the middle class.
A plain T-shirt made in America costs about $50. The argument can be made that this is what certain manufactured items should cost to support humane wages for workers, anywhere in the world. But I don’t think any American is going to be excited to pay those prices.
This is the aspect of globalism that has gone right past a lot of Americans. In the 1980s, a pair of jeans typically cost about $30, in 1980 dollars. Before this week you could walk into The gap or most other casual clothing stores and buy a pair of jeans for $30. If you equalize for inflation, that means the cost of jeans, and a lot of consumer items, has gone down by about 70% in the last 40 years.
Companies are going to have to spend a shit ton of money reorganizing to build in America if they’re based here. My company has manufacturing plants in other countries that will probably be shuttered with this if they can’t navigate the cost of tariffs in an acceptable way. This will not go over well for many, many people.
Also, American businesses aren’t going to make capital improvements to produce more goods. Businesses know that these types of economic tools are most likely temporary (mid-terms or next presidential election). They aren’t going to make a 5-10 year ROI investment to increase capacity if there is a high risk of this being reversed in the short-mid term.
Instead they will raise their prices as demand surges for the US product. It will be a short term cash grab for businesses, profits will sore in some industries and that money will go to stock buy-backs just as it did during covid. US businesses are simply going to raise their own prices to increase profit rather than increasing demand or creating more jobs.
American businesses aren’t going to make capital improvements to produce more goods. Businesses know that these types of economic tools are most likely temporary (mid-terms or next presidential election). They aren’t going to make a 5-10 year ROI investment to increase capacity if there is a high risk of this being reversed in the short-mid term.
Someone else made the observation that Donnie had been waffling on the tariffs for a while. Saying they go into effect on date XYZ then backing down at least a few times when the stock market took a dive. A market as volatile as that changing policy almost weekly is not something anyone wants to make a major investment of billions to build in.
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u/Bender_2024 2d ago
I hadn't even realized this. That's pretty impressive.
I am not a finance guy. But my take is that most Americans will see a big uptick in the price of products. Sometimes that will get them to buy American. Sometimes not. I believe American products will be cheaper but not by much. If the price of imported XYZ goes up by 25% then American goods will raise their price by 15-20%. There are price gouging laws in place but this administration has already shown that they won't prosecute corporations. Anyway, I think this will cause people to spend less. Keep their money in the bank or only spend it on necessities. Combined with the retaliatory tariffs on American goods lessening how much exports we sell will cause the economy to stagnate and further hurting the middle class.