California is controlling the U.S. There is no shortage, only logjam.

[Anti Federalist]

There may have been one or two other variables at play there. You know. Like hyperinflationary money printing, foreign aid, overregulation, micromismanagement, a few little things.

No doubt.

But there is no question in my mind that the start of all this was handing our currency, our manufacturing, and by extension the American middle class, over to Chairman Mao, by the twin snakes of Kissinger and Nixon.

Because tariffs always, ALWAYS cause more economic harm than good. Always.

That's an absolute that CCT declared.

And it's not true.

[Occam's Banana]

Let's say you're Stanley tools in CT.

To manufacture a hammer in China, ship it halfway around the world, get it here, package it for retail sale, ship it to retailers or direct to customers, costs $10.

To make it here, costs $12.

MSRP is $15.

Okay.

Even though the Chinese product is of inferior quality, the supply logistics are a nightmare (your last shipment of 100,000 hammers went to the bottom of the sea when the container they were packed in went overboard in a typhoon off in the Pacific), the in shipment "shrink" is significant, in spite of all those added difficulties, the $2 of extra profit in each hammer is too much of an incentive to pass up.

As awful as all that sounds, it doesn't matter. All those things have already been accounted for and subsumed in the stipulated cost of the hammer ($10) and will have no additional relevance to or effect on anything beyond that.

A two dollar per hammer tariff would reverse that incentive, and Stanley would forge hammers, of better quality, in Connecticut instead of China.

And still make a healthy profit on each hammer sold.

But it doesn't reverse that incentive. In fact, since Stanley no longer have to worry about their Chinese competitors underpricing them, it would, if anything, incentivize them to actively reduce the quality of the hammers they already make so that they can make an even healthier profit on each hammer sold

And in any case, none of this actually answers or addresses the question I asked:

How does making the product of one American industry more expensive to other American industries "spur production" in those other American industries?

IOW: How does making American-made/produced hammers more expensive "spur production" (rather than retard it) in American hammer-using/consuming industries?

IOOW: How does artificially making hammers more expensive serve the interests of anyone but hammer-makers?

Let's say you're Stanley tools in CT.

See, but that's just the problem. I'm not Stanley. Neither are the overwhelmingly vast number of employers/employees/consumers/etc - in CT or America.

So why should Stanley get this special government-granted consideration at the expense of everyone else who isn't Stanley?

[Anti Federalist]

“There’s just something … larger at work here. It has to do with our identity, it has to do with what it feels like when we’re actually making things as a country.” - Mike Rowe on Tucker Carlson 8 Jan 2017

And he's right.

There is more to this than just dollars.

[TheTexan]

I would not be terribly upset if tomorrow all imports/exports of physical goods were announced to banned in totality in phases over 5 years.

The US is a large enough country to be independent.

It would result in a lower quality of life in America in the short term.

In the long term I do not believe it would make any difference at all.

Global trade, on physical goods, is overrated imo.

This is not to say I am in favor of such a thing, merely that I think the negative long term consequences would be negligible.

[Anti Federalist]

See, but that's just the problem. I'm not Stanley. Neither are the overwhelmingly vast number of employers/employees/consumers/etc - in CT or America.

So why should Stanley get this special government-granted consideration at the expense of everyone else who isn't Stanley?

Because it isn't just Stanley.

And it is the Stanley's and Black and Deckers and Milwaukees and hundreds of others that employ millions of people in good paying middle class jobs that pay enough money so that you can live a comfortable life and raise a family, and be part of and supportive of our nation and western civilization, instead of becoming a drug death statistic or a pink haired lesbian communist burning the place down.

That's what this government is supposed to do: provide the blessings of liberty to ourselves and our posterity.

It is actively doing everything it can to do the opposite.

[TheTexan]

The world may in fact be better off if every country had isolationist policies.

It would result in more distinct cultures and true diversity of ideas.

$#@! global trade.

[Occam's Banana]

But if that would be good for all 50 states (which is, after all, just a different way of saying "America"), then why don't the advocates of higher tariffs on goods from other countries also advocate for a Constitutional amendment to allow each state to impose tariffs on goods imported from other states?

I'm all for it.

I'd happily slap a tariff on goods made in, say, California, as matter of protest against their policies.

I've had this argument many times here, you can go back and see my position has always been in favor of protective tariffs.

I've always been in favor of an across the board 30 percent tariff on everything Made in China.

Had that been put in place, perhaps China would not have been in the position to create, then release, a biological weapon on us and the world, that has now killed close to three quarters of a million US citizens.

You single out China and California, but my point is that your logic applies just as much to Connecticut as it does to those two popular punching bags - or to any other arbitrary geopolitical divisions. (And the reasons for any given tariff - "protective" or "punitive" or whatever - simply don't matter. They are completely irrelevant to its consequences. A tariff of T% imposed for reason X will have exactly the same effects as a tariff of T% imposed for any other reason Y.)

How does it benefit New Hampshire to impose tariffs on goods (including Stanley hammers) from Connecticut, and vice versa?

And if it does, should it not also benefit Hillsborough county to impose tariffs on goods from Merrimack county, and vice versa?

And if it does, should it not also benefit Manchester to impose tariffs on goods from Nashua, and vice versa?

And if it does ...


Also, if tariffs are beneficial on net, then why stop at a figure like 30%?

Would not a 50% tariff be that much more beneficial?

Or 75%? Or 100% Or 200%? Or ...

[TheTexan]

You single out China and California, but my point is that your logic applies just as much to Connecticut as it does to those two popular punching bags - or to any other arbitrary geopolitical divisions. (And the reasons for any given tariff - "protective" or "punitive" or whatever - simply don't matter. They are completely irrelevant to its consequences. A tariff of T% imposed for reason X will have exactly the same effects as a tariff of T% imposed for reason Y.)

How does it benefit New Hampshire to impose tariffs on goods (including Stanley hammers) from Connecticut, and vice versa?

And if it does, should it not also benefit Hillsborough county to impose tariffs on goods from Merrimack county, and vice versa?

And if it does, should it not also benefit Manchester to impose tariffs on goods from Nashua, and vice versa?

And if it does ...


Also, if tariffs are beneficial on net, then why stop at a figure like 30%?

Would not a 50% tariff be that much more beneficial?

Or 75%? Or 100% Or 200%? Or ...

The primary point of tariffs is to produce something locally. So there is less logistics costs, and its accessible in times of crisis.

There are diminishing returns on trying to get it ever more local. Within the borders of the US, is "close enough" for most goods/services. Within borders of Texas I would argue is even better. But beyond that there is not much point.

[TheTexan]

One reason why 3d printing is so exciting is because it lets you produce things ultra-locally. There is a benefit to that, as there is as well with having the manufacturing facilities of critical items within arms reach.

[Occam's Banana]

Because it isn't just Stanley.

And it is the Stanley's and Black and Deckers and Milwaukees and hundreds of others that employ millions of people in good paying middle class jobs that pay enough money so that you can live a comfortable life and raise a family, and be part of and supportive of our nation and western civilization, instead of becoming a drug death statistic or a pink haired lesbian communist burning the place down.

That's what this government is supposed to do: provide the blessings of liberty to ourselves and our posterity.

It is actively doing everything it can to do the opposite.

But when it comes to hammer tariffs, it is "just Stanley" (and their fellow hammer-makers).

All those other employers/employees/consumers/etc. who have to pay the price for Stanley's "tariff privilege" would like to "live a comfortable life and raise a family, and be part of and supportive of our nation and western civilization", too. Do they get to just kick rocks?

How does forcibly taking money out of the pockets of American hammer-users and putting it into the pockets of American hammer-makers serve any of the good causes you mentioned?

I posted this earlier, but it bears repeating:

INCORRECT
People who benefit from American tariffs:	Americans
People who suffer from American tariffs:	Foreigners
People who benefit from foreign tariffs:	Foreigners
People who suffer from foreign tariffs:	Americans
CORRECT
People who benefit from American tariffs:	the American government & its protected cronies (and their employees)
People who suffer from American tariffs:	all other employers/employees/consumers/etc. (American & foreign)
People who benefit from foreign tariffs:	foreign governments & their protected cronies (and their employees)
People who suffer from foreign tariffs:	all other employers/employees/consumers/etc. (American & foreign)

[TheTexan]

OB would you be comfortable with all of your guns/ammo being shipped in from China, and not having any kind of meaningful manufacturing capabilities for those items within the US?

It's a bit of a far fetched thought, but there are equally necessary items (such as microchips) where this is indeed the case.

(I understand 3d printing may eventually change the calculus of this question, but we are not at that point yet)

[acptulsa]

Because it isn't just Stanley.

And it is the Stanley's and Black and Deckers and Milwaukees and hundreds of others that employ millions of people in good paying middle class jobs that pay enough money so that you can live a comfortable life and raise a family, and be part of and supportive of our nation and western civilization, instead of becoming a drug death statistic or a pink haired lesbian communist burning the place down.

That's what this government is supposed to do: provide the blessings of liberty to ourselves and our posterity.

It is actively doing everything it can to do the opposite.

And that means tariffs--a thieving, backed-by-violence top-down big government action--is the cure for psychotic big government? The cure for too many regulations within the borders is more regulations at the borders? If government is exercising too much power, we have to have a stopgap measure until we can take big, out of control government down a notch that involves government wielding more power, in other words, being ratcheted up a notch?

Has government ever made America great? Or did America always enjoy greatness only when government did least?

Enough band aids. Sooner or later we're going to address the heart of the actual problem, or be overwhelmed by it. And I'm not sure how much "later" we have left.

[nobody's_hero]

Bible says if you don't work, you don't eat.

Somehow we've gotten away with it for over a hundred years but I think that's coming to an end. Cheap availability of goods imported from overseas has allowed us to outrun, conceal, and somewhat negate the harmful policies of the Federal Reserve. I hardly bother debating over tariffs anymore because we're not living in a vacuum devoid of central planning, so there is just no way to test whose economic theory is valid when put into practice.

[acptulsa]

I hardly bother debating over tariffs anymore because we're not living in a vacuum devoid of central planning, so there is just no way to test whose economic theory is valid when put into practice.

The "economic policy" of freedom was tested a hundred years ago. It worked so well it was called "The Roaring 'Twenties".

We could do with another Roaring 'Twenties.

[Occam's Banana]

The primary point of tariffs is to produce something locally.

I disagree that local production is the primary point of tariffs. But it doesn't actually matter:

[T]he reasons for any given tariff - "protective" or "punitive" or whatever - simply don't matter. They are completely irrelevant to its consequences. A tariff of T% imposed for reason X will have exactly the same effects as a tariff of T% imposed for any other reason Y.

So there is less logistics costs [...]

I previously addressed this:

Pre-existing allocations of capital and economies of scale might very well make it cheaper for Oklahoma to "freight raw materials halfway around the world and back" - even without tariffs and duties and all that other bull$#@!. There are only so many steel mills that are actually needed to meet demands at any given time, and it would make no sense for Oklahoma to expend resources to build new steel mills if they could more cheaply and easily ship raw material to already-existing plants elsewhere and then ship back the refined product. This would allow them to expend those resources on other things rather than on mills that might well end up sitting idle some of the time because there isn't enough for them to do (and that were built just for the sake of "having their own" or "doing it themselves" and not because it made any economic sense). It's basically the same reason that most households don't make their own clothing anymore. Why bother? It's more trouble than it's worth. Comparative advantage and the division of labor are good things. It doesn't make sense to thwart them merely for the sake of localism (which I am all for politically - localism, I mean).

[...] and its accessible in times of crisis.

Good lord! We are already suffering under the consequences of foolishly governing to the current "crisis" - and now we also need to hack the economy in service to future crises as well? What are all those tariff-protected resources supposed to be doing while they're waiting for their "times of crisis" to show up? I mean, that's some real Paul-Krugman-esque "stimulate the economy by preparing for a fake alien invasion" logic, there. (And I'm LMMFAO at the idea that tariff implementers are going to be anything other than corrupt and/or incompetent when it comes to deciding which tariffs to impose upon whom in the name of preparing for vague, unspecified, yet-to-come "times of crisis".)

There are diminishing returns on trying to get it ever more local. Within the borders of the US, is "close enough" for most goods/services. Within borders of Texas I would argue is even better. But beyond that there is not much point.

The only "returns" (diminishing or otherwise) go into the pockets of those who are protected from the market by tariffs, at the expense of those who are not.

This is true of all tariffs, no matter the scale at which they are applied.

[TheTexan]

Good lord! We are already suffering under the consequences of foolishly governing to the current "crisis" - and now we also need to hack the economy in service to future crises as well? What are all those tariff-protected resources supposed to be doing while they're waiting for their "times of crisis" to show up? I mean, that's some real Paul-Krugman-esque "stimulate the economy by preparing for a fake alien invasion" logic, there. (And I'm LMMFAO at the idea that tariff implementers are going to be anything other than corrupt and/or incompetent when it comes to deciding which tariffs to impose upon whom in the name of preparing for vague, unspecified, yet-to-come "times of crisis".)

With China being the sole manufacturer of microchips in the world, there is no such thing as sovereignty. Except for China.

We're just going to have to agree to disagree on this I guess.

I for one am thankful that Texas maintains its own independent power grid for example.

It is one less thing in the way of Texas declaring its independence.

Comparative advantage and the division of labor are good things.

Comparative advantage and division of labor are good things. But the returns diminish with geographic scope.

The US is large enough to be able to fully 100% take advantage of the benefits that division of labor can provide. The only advantage that China has over us is cheap labor. Which will eventually equalize over the next 20-30 years.

[acptulsa]

I for one am thankful that Texas maintains its own independent power grid for example.

It is one less thing in the way of Texas declaring its independence.

If you like the Panhandle, you had better expect--and even woo--company.



To invoke the secession clause of the Texas Constitution, you may have no choice but place the referendum before three Oklahoma counties, and significant portions of New Mexico, Kansas and Colorado. There may be no other legal way to do it.

[TheTexan]

If you take "Comparative advantage and division of labor" to its inevitable conclusion,

you will end up with centralized manufacturing facilities, like we see today.

From an economic perspective, it's great. Cheap $#@! is awesome.

From a sovereignty perspective, there is nothing worse.

[TheTexan]

If you like the Panhandle, you had better expect--and even woo--company.

Yep. And California seems well suited to separate as well. Good for them.

[acptulsa]

As for the logjam, shippers will rediscover the Panama Canal sooner or later. And all the ships which aren't too broad of beam to fit through it will suddenly become more valuable.

I like it when California shoots itself in the foot. It works for me.

[Brian4Liberty]

There was this presidential candidate one time who proposed eliminating the IRS, and the Fed government would only get it’s revenue in a constitutional manner via (flat) tariffs. He was pretty good.

[TheTexan]

There was this presidential candidate one time who proposed eliminating the IRS, and the Fed government would only get it’s revenue in a constitutional manner via (flat) tariffs. He was pretty good.

A government with its only revenue from tariffs, would be naturally limited in how much revenue it could collect. Which is a very good thing.

[Brian4Liberty]

Something about putting all your eggs in one basket comes to mind. Depending too much on Asian manufacturing and products can leave you in a bind. Add to that the dependence upon shipping. Leaves you vulnerable.

[TheTexan]

If Congress were to spend a week partying and sniffing coke off strippers asses and walked into Congress and threw darts at a board to decide which tariffs to collect or how much to collect,

I would be fine with that.

Tariffs do not offend me.

The only thing I would ask, is a level of consistency. Don't go around adding and repealing tariffs every 3-4 years.

Whatever they decide with tariffs, the market will adapt to it, and all will be well.

[Brian4Liberty]

Speaking of California, it used to supply quite a lot of food. That was until they cut off water, and then paved over much of the farm land. Hard to go back to farming when the land is covered with subdivisions.

[TheTexan]

Property tax offends me because I laid claim to this plot of land years ago. It is mine.

Income tax offends me because what I produce is the fruit of my own labor.

Tariffs dont offend me, because I have laid no such claim to the borders of this country. I don't know who owns the borders but it sure as $#@! isn't me.

[TheTexan]

And he's right.

There is more to this than just dollars.

Freedom in the market leads to efficiency, but not necessarily sovereignty.

If you want sovereignty, there is always a price to be paid.

I will always prefer sovereignty, over market efficiency.

[Anti Federalist]

There was this presidential candidate one time who proposed eliminating the IRS, and the Fed government would only get it’s revenue in a constitutional manner via (flat) tariffs. He was pretty good.

Who was that guy?

[Occam's Banana]

OB would you be comfortable with all of your guns/ammo being shipped in from China, and not having any kind of meaningful manufacturing capabilities for those items within the US?

I'm not entirely sure what "comfortable" or "meaningful" are supposed to denote here.

But whatever lack of "comfort" I might have with my guns & ammo coming only from China, should I be any less "uncomfortable" with them coming only from Canada? Or even only from Texas? For example, why should I be more "comfortable" with a tariff of X% imposed on imported armaments than with, say, a tax of X% imposed by Democrats on domestic armaments (which would presumably also apply to imports as well)?

It's a bit of a far fetched thought, but there are equally necessary items (such as microchips) where this is indeed the case.

Which is all the more reason to oppose tariffs on those items. And in the case of microchips, it's not just a matter of comparative advantage and division of labor. China, Indonesia, et al. have better access to more abundant sources of the necessary natural resources.

As I noted in a previous post, there are very good reasons why households no longer make their own clothing. Artificially inducing them to do so again is not going to make them more prosperous in the short or long term. Nor will autarkic tariffs make America (or this or that state/locality) more prosperous or independent - and for exactly the same reasons. It will only serve to induce wasteful misallocations of capital for the sake of enriching some Americans (or state/local factions) at the expense of other Americans (or state/local factions), while making the former more dependent on a brittle tariff regime and the politicians & bureaucrats who implement it.

[Anti Federalist]

The "economic policy" of freedom was tested a hundred years ago. It worked so well it was called "The Roaring 'Twenties".

We could do with another Roaring 'Twenties.

We could.

The Immigration Act of 1921 effectively shut down all immigration.

The Emergency Tariff Act of 1921 allowed US agriculture to survive disruptions caused by the Great War and become what it is today, the last thing we make well.

The Fordney McCumber Tariff of 1922 also was in place.

The tariff was supported by the Republican Party and conservatives and was generally opposed by the Democratic Party, liberals, and progressives. One purpose of the tariff was to help those returning from World War I have greater job opportunities.

The more things change, the more they remain the same.