I’ve been reading up on the tariffs that were imposed during the Trump administration and I keep seeing mixed reviews about their effectiveness. On one hand, they seemed to protect certain domestic industries by making imported goods more expensive; on the other hand, there’s a lot of talk about higher prices for consumers and retaliatory measures from trading partners.
The thing is, these tariffs aren’t exactly popular among everyone. If we were to look back 1 year out, 2 years out, and even a few more years down the line, how will we actually know if this was a good move?
Surely there are some metrics or outcomes that can help us evaluate their success or failure. I guess it’s not as simple as checking stock market performance alone, although that’s probably part of it, right?
Is it primarily about looking at changes in trade balances with countries like China, or do we need to consider the broader economic impacts, such as job growth within certain industries? And how much weight should be given to the political ramifications, like strengthened relationships (or tensions) with trading partners?
I’d love to hear your thoughts on what metrics or indicators would help determine whether these tariffs were indeed a beneficial strategy. Thanks in advance for any insights!
Your degree of credulity should be criminal.
Sir, this instance is called ‘No Stupid Questions’.
This is by and large - a stupid question.
I’ve learned a lot of people can tell me they are bad, but only a few can tell me why.
I hate the tariffs (and everything else about the orange man), I think they’re a terrible idea. But you’re absolutely right.
Especially right now, Lemmy is an extreme echo chamber. I agree with most of the things being echoed, which is why I’m here, but I also recognize it’s pretty bad.
Your questions was entirely reasonable, and well stated, and a lot of people are just being dismissive, insulting, or saying “just because”. And truth be told, the answer really is a complex one, and would require an actual professional to give a good response.
Yeah, I mean I don’t feel any better than Trump if someone asks me about tariffs and I just say “THEY ARE BAD, OBVIOUSLY”. I don’t feel like that’s any better than Trump’s approach where he just says “THEY ARE GOOD”.
I want to know the supposed theory behind them, if any. If there isn’t one, that’s a big red flag. The few people I know in real life that thinks they are a good idea all seem to share the belief factories will pop up “soon” and no one will care about China anymore. I don’t get it, building factories doesn’t seem that easy. The last time the US mobilized that quickly was WW2, and I don’t think we are that serious this time around.
I think it’s going to be bad but I want to put a measuring stick against it instead of just saying “THEY ARE DUMB”.
there are people who are completely happy with the economy going to absolute shit as long as its by the hand of conservatives.
literally ran into red-hat magas living on disability from the VA whose children are all now unemployed and they couldnt be fucking happier.
these people will absolutely eat trumps feces if it means a democrat has to smell it. there is no reasoning. facts do not fucking matter.
Short answer. They’re not.
They’re not. If you think they are you’re a moron. There’s no gentle way to put it.
It’s a grift. They already did it once this month, it’s called insider trading.
I don’t think it’s a good idea. I just want to know if the badness of the idea can be quantified. Otherwise there’s the chance that in the future, someone decides to do it again.
It had been done before, the result was known. Many people spoke up. It made no difference because his goal is to harm others and enrich himself.
It already happened in the past and had dramatic consequences for trade in the U.S., that being “The Great Depression.”
We already know what happens. It didn’t stop someone from deciding to do it again.
Roll a die, if it’s greater than 7, then they’re a good idea.
Even proponents of tariffs have to admit that the level of thought and planning that went in their execution are incredibly lacking.
Better luck flipping a coin
Any economist or data scientist should be able to pretty easily compare the economic course to a forecast of what would have happened with minimal interference.
Will we listen? No, because experts don’t count for shit in the US anymore.
Will we listen? No, because experts don’t count for shit in the US anymore.
You know, in a world where most people don’t listen to experts and follow data, there’s a lot of money to be made in just doing your research. It seems like over time the people and places that learn to use data to guide their hand will outperform the ones of those that do not.
I guess we will see which one is a winning strategy.
The problem is that the winners don’t share. They exploit the others. That’s exactly what got us here in the first place.
The only person who has any excuse of thinking Tariffs are a good idea is Ferris Bueller because he missed the lecture.
I’ll take a stab at a “serious” answer, although be cautioned that this thinking is irrational.
If they worked, we would see manufacturers almost instantly beginning construction on US factories, opening new ones and reopening shuttered plants. We would see trade “balance” in terms of imports and exports with every trading partner we have.
why? it costs millions of dollars to construct new factories. Maybe billions, depending on the industry. It takes 7+ years to bring a new factory online. more to get all the kinks worked out and at full production.
Trump is supposed to be in office for only 4 years, at best, after which his tariffs will go away. it would be easier to simply just not ship to the US. which is how trade partners responded to the Hawley-Smoot Act in 1930, and which made the Great Depression that much harder to get out of.
For the factory workers in the industrial heartland it will be good.
For the general population it will be bad.
The idea of manufacturing more, cutting budget deficit etc may be a good idea. The way they go about it with trade wars pissing off countries usually friendly to the US is dubios. The DOGE and internal politics does not seem much better but that is not really any of my business as a non American.
Also if you want to cut deficit you should fund the IRS more, not less.
https://www.investors.com/news/auto-tariffs-stellantis-mexico-canada-factories/
Mexico was importing these car parts and then exporting the Truck back to USA. Because we Tariffed Mexico and Canada, the Mexico and Canadian factories are closing down.
Which is now closing down factories in the heartland of America.
Lose lose for everyone. Who is the winner when the singular Truck was being made across Mexico, USA AND Canada?? Tariffs have now ruined the price of these parts and consolidation efforts, so now everyone is losing their jobs.
Ok, another answer closer to the ground. 2 goals are often invoked. Reduce the trade deficit and increase domestic manufacturing.
- Trade deficit
… means that more goods (and services) come into the US from the rest of the world than the US delivers in return.
Reducing the trade deficit makes Americans poorer by design. There will be fewer goods available for Americans, either because they have to give up more to the rest of the world, or because they don’t come into the country in the first place.
The rest of the world is willing to loan money to people, companies, and governments in the US. It is also eager to invest in the country, because it really was a good place in which to do business. Look at the current big thing: AI. You can’t really do that in the EU, and investing in China has its own risks. Trump may actually reduce the deficit by making the US more of a South American style banana republic.
- Manufacturing in the US.
One manufactures stuff outside the US and transports it there because it is more efficient. Americans can be more profitably employed in different areas. Moving more manufacturing to the US should be expected to leave the average American poorer. It should not be expected, in isolation, to reduce the trade deficit as it creates new investment opportunities that potentially attract foreign money, increasing the deficit.
However, while Americans would be left financially poorer, there may be benefits not captured by conventional econometrics. Maybe manufacturing is more emotionally satisfying in a way that is not captured by only looking at the wages. Who knows?
Unfortunately, getting to that state will be brutal. Millions of people will have to find and learn new jobs. That is what happened when manufacturing was off-shored. Reversing that will have the same cost. Some economists have come to believe that the psychological cost of such structural changes has been vastly underestimated, and that is why trade agreements are so unpopular. The benefits from free trade may not outweigh the psychological pain and disruption of communities. Reversing free trade will have similar effects, that are likewise virtually impossible to measure.
I think the most objective benefit would arise if a war happened that disrupted trade. For example, if Trump invaded Canada and Greenland, this would probably lead to the US being embargoed. Then it would appear good to have already built manufacturing capacity in the US while it was still easy. You need physical goods to fight wars, after all.
I had a pair of grandparents old enough to be involved in factory work and they had hated it. They both educated themselves to a degree where they could get a better job and get out of the factories. It seems odd enough that we’d aspire to go back to these times.
There are ways that tariffs can be used to protect domestic industries. But when they’re done that way, it’s normally specific products, implemented carefully and with some warning. I’m pretty sure there are some tariffs to protect American automakers, off the top of my head.
What the president did is just economic suicide. Sudden, huge, fairly indiscriminate, and fluctuating. I think his goal, in his mind, may have been to replace the income tax, but he really fumbled. And that’s a bad idea anyway, because tariffs and sales taxes hit the middle class hardest, which slows down the economy.
There may also be an explanation that he really doesn’t understand cooperation and believes every deal has a winner and a loser. And then very mistakenly concluded that we were the losers in international trade because of our trade deficit. That’s incorrect. We get large amounts of goods and resources for small amounts of fiat currency, which we always seem to have more of. Our trade deficit considerably improves our quality of life in ways that cannot be replicated by an insular economy.
19th century solution to a 20th century problem in a 21st economy.
It’s bad. But I’m sure some people are making a tonne of money of it. Just not you.
That’s kind of subjective.
There are two broad views on whether something ‘was a good plan.’ Generally, everyone agrees that accomplishing the intended goal is the first requirement, but people tend to divide then on whether there is a secondary requirement. Many hold that the second necessary requirement is that the action doesn’t violate prior tenants.
e.g. if the goal is to get children out of a burning building, actually getting them out is generally a minimum requirement for ‘a good plan’, however, if the plan is to get them out by punting them out the window, it would be argued by many that the plan was bad because it violates a prior tenant to not hurt the children.
For the tariffs, it is almost a given that it will create a better business environment for companies that want to compete in sectors where tariffs act as a protectionist measure. However, it is also generally a given that the tariffs will cause financial pain for the average American, whose standard of living depends on cheap foreign labor. For many people, the damage done to the American public is like the punting. It violates established values, and thus becomes a bad idea.
This also all assumes the stated goal is the real goal. The claim is the tariffs are intended to help American businesses, but the general interpretation is that’s a lie. Many people believe the tariffs are simply a threat to get obedience from other governments. From this view, the tariffs are a failure, because essentially no power has been gained over the rest of the world, and many places that were cooperating freely before now have antipathy toward the US.
If you like paying more for stuff, then yes, it’s a win 🥇
