It's something every budding economist (who isn't a cheerleader for Team Red or Team Blue) knows to be true: countries do not pay tariffs. Individuals do. And the important result of those payments: tariffs make the people paying those higher prices for imported goods poorer.
Politicians – including those who say they support free markets – forget or ignore this when they rally behind tariffs to punish this, that or another country. All they care about is scoring points, which they hope will translate into votes on Election Day.
Just a reminder: it's all economic snake oil…
Five years after then-President Donald Trump declared a trade war with China and slapped new tariffs on steel and aluminum, the U.S. International Trade Commission (ITC) has found that those tariffs jacked up prices and reduced the availability of tariffed goods. In a report released Wednesday, the commission reported that American companies and consumers “bore nearly the full cost of these tariffs because import prices increased at the same rate as the tariffs.”
After investigating the consequences of both Trump's Section 232 tariffs (the supposed “national security” levies against steel and aluminum) and his Section 301 tariffs (imposed against a wide range of items imported from China), the ITC reported that in both cases, domestic price increases matched the cost of the tariffs almost exactly. “The USITC estimated that prices increased by about 1 percent for each 1 percent increase in the tariffs,” the report states.
And of course, the Biden administration has kept a number of those Trump-era tariffs on the books for reasons that have nothing whatsoever to do with sound economic policy. Never mind fighting inflation (yes, those tariffs have played a role in raising prices). And there are also the lost wages, jobs, and overall economic growth.
There can be good political and strategic reasons for making trade with producers and consumers in a specific country more difficult, expensive or even blocked trade entirely.
But never fall for the argument that tariffs don't come with real, measurable costs for American companies and consumers. Tariffs always have inflicted costs and always will.
The opinions expressed in this article are those of the author and do not necessarily reflect the positions of American Liberty News.
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Then Biden stopped it day 1 No change
at least pretend you actually read the article.
Take your own advice.
Clearly this is a very simple and micro economic view of a much more political macro economic strategy. While it is true countries do not pay tariffs and that people may pay higher prices for some imported goods does not necessarily make people poorer in the long run.
Some positive effects include creating more competition for those goods, ergo potentially lowering the price even further than before. The increase of new sources for materials and products. Promoting manufacturing and obtaining resources from within, thereby increasing employment, our economy, and self sufficiency and independence from without.
And, Politically sending the right message to those that would and have otherwise taken advantage of our social economic situation; promoting free markets and fair trade agreements.
These are but a few of the benefits that can result from this strategy. Even the author of this article stated “There can be good political and strategic reasons for making trade with producers and consumers in a specific country more difficult.” China, Canada, and Mexico are certainly among those counties.
This encourages companies to move their manufacturing to other countries from China in order to compete.
How much the writer got paid to make these propaganda article.
The commie govermebt steals from their own people that is what communism is, so they have no shave to also steal from everyone else.
The gov commie elite are the slave masters.
What does the budding economist say when Prices are soooo cheap in China that as many possible manufacturing business moves their factories away from the USA and US citizens lose their jobs? Does the budding economist tell the unemployed person to get training in something else, like for example in data entry? I would much rather be paying a higher price and HAVE A JOB, then paying a cheap price while kicked out in the street. This administration is PRO CHINA. Trumps administration was pro American. Even if products made in the USA were higher priced.
The intent of the tariffs was to prevent dumping by China which undermines domestic production. The raised prices made the imported price comparable to domestic factories ability to produce and sell
at a sustainable price to keep those factories operating.
The reason for the high prices of American made products has nothing to do with tariffs and everything to do with the unions. If the unions didn’t demand double the price of items made overseas then more people would buy American. Unions should be disbanded, especially the so-called Teacher’s Union. The teachers continue to get paid while American children can’t even read or do simple math anymore. Eventually they will be expected to enter the job market and how are they to do that when they can’t even read. I don’t want somebody in a bank giving me my money who can’t even add or subtract without a calculator.
What you fail to understand is that tariffs are to force the people to buy from other sources, hopefully American, and not our enemy. Something economists don’t understand, they only care about money and not national security. Economists don’t give a crap about American jobs, only that the wealthy make more money. Turmp’s tariffs did not cause or result in inflation, as those were in-place long before inflation took off under the Biden regime, and under Trump we had some of the lowest inflation we had seen in years, maybe decades.
Well, I am inclined to curse old Tricky Dickie for (1) canceling the Gold Standard and (2) opening the door to trade with China, our furious frenemy; for now it seems everything in the USA, to ou detriment, is MADE IN CHINA. .
Anything from the Washington Post is junk. Communist Red China is our number one enemy. We should not import anything from them. We should rely on our traditional friends like the Philippines, Taiwan, and even Japan.