People, lots of people, lots of people who have a really deep understanding of national and global economics (unlike me), have been warning about this since talk of tariffs became common currency a year ago.
I wouldn't like to comment on HN's political leanings in the round and, obviously, there are a large portion of non-US readers/commenters on the site (including me), but will say this: there are a portion of you who voted for this. Exactly this.
What were you thinking? What was going through your heads? I'm genuinely curious.
EDIT: Wow... well, having asked the question, it looks like I now have a lot of answers and perspectives to read. Thank you all for taking the time to comment.
Why would you (or anyone) be surprised that economically sound policies are not popular? They are not popular in the US. They are not popular in Europe. They’re not even popular on HN.
You're assuming that modern politics across most of the World has something to do with rational, logical thought. Russia, China, Europe, the US, the Middle East - they are all in a quagmire of irrational fractures between the public and the political classes who want power/control for benefit of themselves rather than for the benefit of that public.
It's not unique to the US, it's just that they look like they are speed running it from outside.
Facts change nothing. This report means nothing. These people still believe. The report is wrong. They are right.
The truth is whatever they want it to be, not something out of their control.
Talking with him makes _me_ worry about my own beliefs, because if these people can be so blind, maybe I am too.
Many other Americans are pretty open-minded to new facts, even today. Unfortunately this kind is relatively geographically concentrated in urban or academic communities, and many of them are also discouraged from voting by being fully aware of how desperate and hard-to-fix the US political situation is, thus minimizing their electoral impact.
The Italian Catholics have got a handle on this with many of their relics.
Bits of various saints are in glass boxes all over Italy. Presumably they could be DNA tested?
We should ban advertisements of religions. If their gods are so powerful then they shouldn't need advertising. And if you are a believer AND god turns out to be real then banning advertising could lead to the return of Jesus. Win win.
But if you do believe hard enough, if you give it your all and exclude anything else than your believes, when you become one with it - then you can certainly increase the collision speed quite a bit! :-)
I was talking about the impact of the current state of the world on existing relationships.
Stop contributing to the problem.
It's sad but true. Deep down, political thinking is influenced by tribal thinking, a rigid us versus them mentality.
This is, after all, how the "divide and conquer" method gets to be so effective. A house divided amongst itself and all that.
Not that it’s necessarily as bad everywhere, but time and time again I talk to people from various countries who say the current leader never could have been elected back when they were living there.
A lot of this, as in the case of Trump, seems like legitimate dissatisfaction that voters have which is funneled into finding alternatives to the people that are currently representing them, without deep thought about the outcomes of the policies the replacement is pushing for. In the case of Trump voters in particular people seem to very frequently be willing to overlook statements they would otherwise disagree with just because there are other statements that align with their thinking, or that seem like “change” that they are willing to support to see where it leads.
Most people I speak to in Canada, Europe and Central America seem perplexed why Americans they know do not seem more alarmed.
It's because we live in the beginnings of a dual state:
https://www.nytimes.com/2026/01/18/opinion/renee-good-ice-im...
Quoting the key point:
> The two components of the dual state are the normative state — the seemingly normal world that you and I inhabit, where, as Huq writes, the “ordinary legal system of rules, procedures and precedents” applies — and the prerogative state, which is marked (in Fraenkel’s words) by “unlimited arbitrariness and violence unchecked by any legal guarantees.”
> “The key here,” Huq writes, “is that this prerogative state does not immediately and completely overrun the normative state. Rather, Fraenkel argued, dictatorships create a lawless zone that runs alongside the normative state.”
> It’s the continued existence of the normative state that lulls a population to sleep. It makes you discount the warnings of others. “Surely,” you say to yourself, “things aren’t that bad. My life is pretty much what it was.”
More at https://www.theatlantic.com/magazine/archive/2025/05/trump-e...
It's not unique. If anything, it's inevitable regression to the mean. Entropy rises eventually and does this
monaco, liechtenstein, singapore, luxembourg, ireland, macau, qatar, bermuda, norway, switzerland
One party state w/ elections: singapore, macau
direct democracy: switzerland
represented democracy: Norway, Bermuda, Ireland, Luxembourg
Multi-party representative democracy is less than half. And none of the top 3. An interesting, but uncomfortable, fact. The people are not good at picking economically rational leaders in adversarial elections.
> ...
> In 2017, Ireland's economic data became so distorted by U.S. multinational tax avoidance strategies (see leprechaun economics), also known as BEPS actions, that Ireland effectively abandoned GDP (and GNP) statistics as credible measures of its economy, and created a replacement statistic called modified gross national income (or GNI*)
Source: Wikipedia on GDP per capita, PPP
I don't think your conclusion about governance is warranted, given the important other factors you aren't accounting for in your list (also presence of large oil & gas natural resources).
Perhaps making good economic decisions grows exponentially in difficulty with the population size, especially for “conventional” economies that do not have another cash cow.
E.g. which of these countries has any kind of youth culture to speak of?
Basically, the boring solution (democracy) gets you boring, middle-of-the-road results, while a monarchy is more likely to get you an outlier. The outlier might be at the top or the bottom of the pack, but because it's not democracy any more you don't have any say, so tough toenails if it's the wrong one.
All of it still comes down to the competency of that leadership though.
That said, I don't believe there's a single factor that determined the election. A flip in any of a dozen or more factors could have resulted in a different outcome.
Our elections have been so close that there are numerous single factors determining the outcomes, if that makes sense.
Not sure if that's specifically directed at me, but that's exactly what I said.
The amount of crazy and not so crazy shit I hear for voting for this idiot is incredible. Though the Dems do themselves no favors either.
No, they voted for Trump because he was their guy then later made up a rational justification. We know that people generally do NOT make decisions by rationally evaluating things, their subconscious makes a decision and their conscious makes plausible rational arguments. (Yes, citation needed.)
Since these regional governments would be picked from the inside, hopefully there wouldn’t be as much of a contrarian reflex to oppose everything they do.
That said, I'm not sure being a woman was worse than being from CA or black with a solid chunk of the electorate. (I'm reminded of how some of my own relatives seemed to want to avoid visiting us in CA growing up because they had such a strong notion of how "communist," "liberal," and dangerous it ostensibly was.)
In some ways this also illustrates that propaganda likely had a significant role, too, IMO.
Had the DNC allowed Bernie Sanders to win, or had Biden not picked his running mate on the basis of a Berkeley focus group where the participants were trying to out-virtue each other, we would live in a very different world.
I voted for Harris, I even canvased for her, but I think its a sexist oversimplification to suggest she lost because she is a woman. She lost because her campaign was lame.
But she did offer voters lots of things if you spent 30 seconds listening to her and stepped out of the faux news and Twitter echo chambers.
And basically every last bit of it would’ve helped the average American. She just didn’t lie and claim she had a magic wand to fix price gouging her first week in office.
https://www.politifact.com/article/2024/sep/30/kamala-harris...
*And to be clear, it’s rather interesting that both Kamala and Hillary were blamed for “not having a platform” which seems to be the go-to for people who refuse to vote for a woman but can’t actually attack them on their platform. Just claim they don't have one or didn’t do a good enough job explaining it!
Democrats who believe in "realistic" political campaigns are why awful people keep winning.
Now you’re criticizing her for “giving in to political resistance” - and by that you mean not getting up on stage and just knowingly and blatantly lying to the American public by claiming she would single handedly drop the price of groceries and gasoline in her first week in office while also ending the war in Ukraine?
I think you’re both moving the goal posts and claiming that the rest of us are looking for a presidential candidate that has no moral compass. I’m good.
This is the lamest bullshit policy which almost seems calculated to alienate voters who it doesn't put to sleep.
Please don't act like democratic politicians are losing because they have a moral compass. Ridiculous.
Similarly, AOC should visit the south, eat some grits, volunteer with some Black churches, and do a little skeet shooting with some good ole boys.
https://news.gallup.com/poll/186248/quarter-voters-say-candi...
But I don't think that one performative step would help, it would require like decades of change on the platform of the Democratic party.
What the democrats need is an aggressive economic policy that actually will manifestly improve regular people's lives. If they cannot articulate such a thing and credibly convince the voter that they will fucking fight for it, they will never win.
No one at a gun range is changing their vote.
Both parties already know which voters change their votes depending on the situation. The data's already told strategists in both parties that the hotspots are, generally speaking, a few counties in a few states in the midwest, Pennsylvania, and more and more Arizona. So they don't really need to do more than pay lip service to any others. Because the data's already told them that the others won't change their votes in any case.
Ideas and modeling no longer matters? What matters is that you're doing a TikTok eating a southern specialty?
Spectacles actually matter too. You need to know which one to perform and that requires certain understanding of your audience
A Republican candidate could be a Muslim, a women, or trans, but that's not a good reason to vote for them. It should be about what they stand for. Voting for a Kristi Noem would be terrible, for example.
Similarly, the Democratic Party, if they're to win, should not depend on the opposition failing or on identity, but instead on solid ideas and the ability to communicate it well. Kamala wasn't that.
Only when nothing else is on the line will they say "I won't vote for a woman."
And Democrats aren't so broadly driven by identity politics that a Republican candidate merely being a woman would attract significant Democratic defectors. She would still have to be somewhat inspiring/charismatic, fairly centrist, and probably pro-choice.
Even in the peak-"woke" Democratic primary of 2020, all the women lost to two old white men.
Not anymore.
Three more years to climb out of the dumpster fire though. Then, maybe?
But right now? No.
In this moment, the political reality in the US is that Democrats would have to lose. Republicans, male or female, can't really win without that help. Especially in light of MAGA.
I would have thought Wisconsin would have been a wake up call for Republicans. But it hasn't happened yet.
So far both of these parties are sleepwalking into disaster and the world outside the US will pay a portion of that cost. Which is sad.
This was about all thosw isms and hierarchies we pretended dont exisr anymore.
Democrat policies polled better than Republican policies at the last election.
I did not bother canvassing or donating to the Harris campaign for this reason, for the same reason I did not help pro vaccine non profits during the pandemic trying to convince antivaxxers. You aren’t changing someone’s belief system and mental model on timelines that matter for election outcomes. Mamdani was able to win NYC because young people and women turned out in force and ranked choice voting. The electoral college overweights rural, lower education parts of the country in US voting influence.
Based on the above, it will be a long time before enough of the US electorate has turned over before you can run a women presidential candidate imho. 78% of farmers voted for him, and still support him, even as he destroys their way of life, for example. Progress occurs one funeral at a time (Planck).
I recommend the recently released book “The Vanishing Church: How the Hollowing Out of Moderate Congregations is Hurting Democracy, Faith, and Us” by Ryan P Burge (ISBN13 9781587436697) as a contributor to understanding this topic, as well as “Everybody Lies: Big Data, New Data, and What the Internet Can Tell Us About Who We Really Are” by Seth Stephens-Davidowitz (ISBN13 9780062390851).
Edit: This comment https://news.ycombinator.com/item?id=46681760 touches on this as well.
The fact Biden said he wouldn't back out then suddenly did at the 11th hour made the whole thing far more bizarre and was a massive erosion of confidence in any semblance of a plan for the presidency by the Democratic Party. I ended up voting for a 3rd party because both campaigns were run so horribly to the point I couldn't even imagine either side managing a mayor's office let alone the country.
Im gonna put a theory out that I havent seen here yet, a lot of people voted for Trump because they got dunked on by leftist Twitter, told they were racist/fascist/whatever for having an opinion like "communism is bad", and now comes a guy who wont back down and who legit makes them cry liberal tears. Ever been pissed off at someone with no recourse? Of course they want that kind of satisfaction.
Because if that is true, you're re-writing the rules of your "personal voter math" to fit your narrative, and if it isn't true, your "personal voter math" === your opinion, which isn't really useful.
It's just that if in front of you, you have a weirdo who gives some stupid "with me, everything is free, and there's no problem" line, that is provable completely bullshit, but that your population is too uneducated (or too in a cult) to understand, then this happens...
What did you want Democrat to do? Give the same lies that GOP does? then what's the endgame?
I hope I'm wrong.
People talk a lot about Trump but I think a lot of people just voted against the other option so it didn't have much to do with Trump to begin with.
Also being part of a social category doesn’t mean one will be immune to bias against this very category if it’s heavily pushed in the dominant social constructs.
Actually women able to reach top level political function in a patriarchal system will more likely do so by being doubly virulent against feminist standpoints. Look at Tatcher or Takaichi for a more recent example.
Clinton beat Trump by 15 percentage points among women voters. Trump beat Clinton by 11 percentage points among men voters.
The reasons people vote a certain way or can't be bothered to show up at the polls are going to vary significantly across the nearly quarter billion humans making those choices.
So any attempt to "single issue" explain election results are going to be wrong, particularly in a close election like this one. (49.8% vs 48.3%, and Electoral Votes in battleground states often in the tens of thousands of voters, out of tens of millions.
But many of the issues certainly contribute to flipping voters between one candidate, another, or staying home.
So sure, totally, gender and race played a role.
The economy (and steep inflation) played a role.
Biden being an increasingly disliked incumbent, staying in the race too long, and Harris being too conservative to distance herself from him played a role.
News and propaganda played a role (and I suspect this is a big one. Remember when Trump was all like Deep State, Democrats and Epstein, let's get those files released! And then it came time to do it, and for some reason he was like... oh that's a bad idea?)
No doubt individual state politics play a role, too - an unpopular governor might give the opposing party a boost.
But yeah, if the Democratic nominee was a) nominated, and b) a white male, the odds probably would've shifted in their favor enough to flip those few battleground states.
Both parties are quite disconnected from the interests of the "ordinary people", and the "ordinary people" voting from them are often quite disconnected from the reality; instead they want someone who would approve their preconceptions, and would stick it to "them" in the endless political sports match.
Which may not be that endless: if the political climate of the US deteriorates enough, some authoritarian populist could just get elected and never leave. The current administration likes to hint at that, but they seem to inane to actually pull this off. Somebody less theatrical and more cold-blooded could, though :(
If people stopped spending hours each day scrolling through Instagram, TikTok, and Facebook feeds, media incentives would change. Journalism would become more thorough and responsible, rather than optimized for outrage and clicks. People’s attention spans would recover, making them more capable of listening to opposing views and engaging in meaningful discussion. The overall quality of public debate would improve, and political leaders would be chosen based on objective, long-term policies rather than emotional manipulation.
The reinforcement-learning algorithms that drive these feeds are fundamentally unnatural. They represent a massive, uncontrolled social experiment on humanity—one that is far too powerful for our psychological reward systems to handle.
What needs to happen is education. Education on how the attention economy works. People must learn to resist becoming social media junkies, because every hour surrendered to these platforms reinforces the very systems that distort public discourse. When we lose control over our attention, we don’t just harm ourselves—we actively worsen the societal conditions that enable manipulation, polarization, and poor political leadership.
The age groups who spend the most time on TikTok and Instagram are the least likely to have voted for this administration.
There were populist demagogues getting elected before social media and cell phones, too. This isn’t a modern thing.
I know everyone wants to use this moment in politics to blame their own pet peeves, but blaming social media junkies for this election just isn’t consistent.
Example: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4230288
We haven't invented a governance structure yet that would be immune to this, although some are better than others. I'm sure the current social media algorithms are harmful as well. You can ban viral algorithms, but the hostile actors whose literal job it is to drive polarization / populism will just find other strategies to effectively deliver their message.
"Education" is nice and all, but millions of people keep smoking despite the obvious harm and decades of education, not to mention the many limitations, taxes, and bans. I mention smoking as an obviously-bad-thing that everyone knows is bad. Education succeeded, and yet, here we are, still puffing poison. But you can also look already-polarized political topics. There's been no shortage of education on those topics either, but if that worked well enough, we wouldn't be decrying populism right now.
We had the same problems before social media. It's not the cause, just a symptom.
> If people stopped spending hours each day scrolling through Instagram, TikTok, and Facebook feeds, media incentives would change.
Many people willingly choose the distraction, they just don't want to bother with politics and stuff. Social Media is just today's most popular distraction at the moment. And Social Media is also useful for those who seek education. It's really more about motivation and presentation than the medium itself.
It may not be the cause, but I think it's also not quite just a symptom. To me it looks like social media has taken an existing problem and made it worse, for all the reasons the parent comment describes, and then some.
> And Social Media is also useful for those who seek education. It's really more about motivation and presentation than the medium itself.
Also true, but I'm not sure this is prevalent or impactful enough for it to avoid being a net-negative. Also don't forget about the motivation & presentation of the platforms - they also have some outcomes they can optimize for, and I think there's a strong case to be made that they're optimizing for attention theft.
I have never — not once — seen an LLM use it in pairs.
1. replacing parentheses —given that the em-dash in pairs for me mark more-relevant-to-the-main content than a parenthesized expression would— so I use the same spacing as `()`
2. replacing colon or just finishing the sentence with a subsentence— so the spacing goes like for a colon.
Probably unfounded grammatically and against any style guides, but this spacing makes sense to me.
Something weird is going on, on iOS I can type either but they look the same in my comment.
Edit: Only before pressing reply. Once posted they look different.
For that we would need a new funding model for journalism. Local journalism (i.e. local newspapers, radio and TV stations) used to be financed by classifieds and ads. Classifieds are long since gone off to the Internet and ads have been replaced by Google Maps plus Facebook, so there's no monetary stream - and as a result of that, there's barely anyone left holding local politicians and companies accountable. Yes, some places have "citizen journalists" and bloggers, but these usually do not have the funds to pay for legal teams and court proceedings, so they usually only target government stuff.
Something like taxpayer-paid media is way too easily corruptible by the government, just look at Hungary for the worst possible outcome. "Mandatory contribution" systems like the BBC or Germany's public broadcasters aren't that easily corruptible, but it still happens - just watch the shitshow every few years here in Germany when the contribution needs to be raised.
It's an all-around mess.
And, if you read the paper, you will find that evidence. How these work depends on initial conditions that vary and exporters will not react in a consistent way.
As a specific example, theoretical research in this area tends to make assumptions around the stationarity of margins that are obviously ludicrous in the context of reality in the US. It is quite easy to justify almost any policy with theoretical research in economics so people who have no understanding of economics will find evidence for whatever position they choose. Reality is quite different.
No, it is surprising, as noted in the article, because basic economics suggests that suppliers will adjust pricing, and eat some of the tariff to keep their products competitive. Page 5:
This finding was initially surprising to some observers. Standard economic models suggest that the incidence of a tariff depends on the relative elasticities of supply and demand. If foreign exporters face highly elastic demand (meaning buyers can easily switch to alternatives), they might be expected to absorb part of the tariff to remain competitive.
ie what happens if global demand exceeds supply and a lot of companies have never tried to find other markets because of the inertia required to do so - but if they are pushed by tariffs they find there are alternative customers out there.
As an example - Canada appear to replaced trading food for cars with the US, to food for cars with China.
https://www.facebook.com/TechXnew/posts/canada-has-made-a-de...
it also assumes that there are no other alternative markets to sell to or that supplier capacity is equally elastic; the US might be a high margin market to sell to, but if you only have a fixed amount of product to sell then it makes no sense to eat the high cost of a tariff to keep selling a low margin product when you can instead sell your product at a medium margin in europe
building out more supply for a product is often capital intensive if you want to make it at an economically efficient price point in these times; efficiencies of scale are hard to overcome and a rapid shift of economic policies makes anyone uncertain about future investment so it takes a very long time for these supply chains to rebalance, if they ever do
> to the surprise of absolutely no-one with even the most basic grasp of how economies function.
But social media changes the equation entirely. It gives us the speed of direct democracy without any of the structure or responsibility. It pushes people to judge candidates issue-by-issue, often on topics they don’t understand well, while eroding the deliberative layers a republic is supposed to have.
The problem isn’t people or education — America didn’t get this far because Americans are any smarter or dumber than anyone else. It’s the design of the systems. The founding fathers built a system that has so far lasted almost 250 years.
You cannot expect people to change — safety protocols, procedures, govenments — it’s about the systems.
Let's pray we're able to figure it out before more blood is shed.
Exactly: tariffs are taxes in another guise. They only serve to create an (artificial) price advantage of local over imported goods for as long as they're levied.
> What were you thinking? What was going through your heads? I'm genuinely curious.
I also can't fathom why the crowd (not just a HN subset) that was clamoring for tariffs thought it'd be anyone other than them shouldering the increase. Perhaps their influencers didn't spell it out for them?
Now everyone gets to pay more - and not just in the US.
Now I'm neither in the US, American nor Democrat/Republican, but as far as I understand their argument, is that they know it means higher costs for those products for them, and it'll eventually lead to companies wanting to produce things within the border, and only after that is in place, will things actually get cheaper (and better?).
So I think for these people with that perspective, the idea is: everything cheap -> tariffs to make imports expensive > People buy less imports and companies start selling within the border > Eventually things get cheap.
Again, this is just me trying to understand their perspective.
I don't believe it for a second.
Here's something that has happened before though. During the American War of Treasonous Aggression, the southern states decided to impose tariffs on the export of cotton to the UK. That caused massive hardship in the UK in the short term as it made the goods that the cotton was a raw material for impossible to sell. UK jobs were lost, UK workers starved etc.
So the local UK manufacturing companies found markets to supply them elsewhere in the world. They set up the supply lines, they reached agreements, and life went on. UK jobs were gained again, UK workers stopped starving. Life was good.
When the American War of Treasonous Aggression was over, the southern states wanted to drop their tariffs and start supplying the UK again. It didn't happen - there was no need to return to an unreliable partner when everything was set up just fine and dandy as it was, and the US cotton was essentially unsellable. US jobs were lost, US workers starved etc. The cotton industry never recovered from that.
Tariffs are a "fuck you, make me" slap in the face. Do it to people you don't like, but if you do it to people who are supposed to be "allies" (obviously not allies in the above case, but the consequences here were just as real), the consequences can be ... quite concerning for the tariffers.
The real distinction is that tariffs are conditional. Currently, firms can avoid them by changing sourcing. That makes them more behavior-shaping than revenue maximizing.
Given that the U.S. never reversed the TCJA corporate cuts from 2020-2024, tariffs are one of the few active levers currently increasing the marginal cost of offshore supply chains.
So roughly 98% of the population was surprised?
The same thing as usual: people don't like how things are going, they demand change, but they're not specific, so the result is extreme, and then people demand change again, and on it goes. There's no great insight or rationale going on. People are just dumb animals in hats.
What you're describing is called "dumping", and it's a strategy China has used to varying degrees of success in other markets in order to destabilize foreign industries. It could be seen as an act of war.
Chinese labor is not actually so cheap anymore, many other developing nations are significantly less expensive. But China's secret weapon is total control and coordination across industries. They use this to subsidize target industries for the export market. You've highlighted automakers, but they also target steel, aluminum, and others. To a casual observer it almost appears as if they were targeting industries that could be readily adapted to wartime production.
The headline suggests it was all passed into consumers. So why is inflation still so low? If you add 10-30% to prices (granted, of imports, not of houses, domestic food etc), you'd expect more.
If companies were eating it (which apparently they aren't) then their profitability should be down. But that doesn't seem to be the case either.
So..??? It's like that riddle with the three guys buying a pizza. Where did the money go?
The Fed predicted it added 0.5 points to what inflation could have fallen to with the expected effects only partially visible. https://www.stlouisfed.org/on-the-economy/2025/oct/how-tarif...
prices are up so people are buying less, it's just that simple; only a handful of companies have reported their Q4 christmas earnings but retailers' are already forecasted to be way below previous years'
Commerce Secretary, Howard Lutnick: “The model is clear: 10% tariffs or less are paid by the manufacturers, the distributors, the businesses,” he said. “The consumer doesn’t pay. The consumer doesn’t pay because the seller doesn’t want to raise prices, because if they could, they would, but they don’t want to sell less. So they eat it.”
https://www.zerohedge.com/markets/lutnick-beijing-eating-maj...
Why am I not paying substantially more year over year for the wide variety of things I purchase?
See also Brexit.
Economics tell people the clear impact, but it doesn't make the news. We get fed with whatever the political influencers decide to tell us. Did the brits expect the consequence of brexit? No but that's because they deemed whatever the news said to be unreliable on this topic. Which for once happened to be true.
I'd get out more, but my tinfoil hat doesn't like the rain.
I mean there were plenty of what would be considered intelligent people that laid out the exact consequences of brexit... problem is the masses don't seem to pay attention to well mannered intelligent people.
Trump and his entire administration admitted there would be short term pain, possibly a recession, but that it would be "worth it" to restructure the economy.
So the question is: how long does the pain last? And is the economy stronger when it's over (do we get over it)? It's been 9 months so far.
From my perspective the policy goals are very unclear since it seems like they're actively wielding tariffs both as a means to reorganize the economy and as a weapon to bully other countries. Mainly bullying. The intended effectiveness on our economy seems difficult to judge.
10 years ago
Yes it will hurt, they argued, but the long term effect will be a stronger and more independent domestic economy. And the pain is worth it for that end. There's plenty of evidence that what actually results are inferior products from domestic companies insulated from international competition, but that was the pitch.
There's also a large group in the base that voted for this who already had an ideological "buy local even if it costs more" philosophy, so to them the proposal was just to force everyone else to join their cause.
In some cases, the Trump tariffs have actually been so poorly designed that US manufacturing has been hit, because the tariffs on the raw materials and parts are higher than the tariffs on importing finished products from third countries...
And in terms of burden - the cost hits the poor the most - but if your a billionaire funder of US political parties that's the point.
For a non-US person the most worrying aspect of this is that it also helps make the US more self-sufficient which means it's better prepared to go to war - which is not really good news.
I know two people who voted for him.
Person one has voted Democrat her whole life. Has worked for the Democratic Party. Has a son who was a Democratic elected official. But she lives in Texas, and watches too much local news, and believed that murderous immigrants were pouring over the border, guns blazing, taking out innocent American citizens daily at the beach and grocery store. So she voted for him because she believed only he could stop this from happening.
Person two is a wealthy white boomer. His business already runs in America. He actually has an advanced degree in economics. He believed that the tariffs would only be used surgically by smart people to protect American business. He is not personally affected by any of the racist policies or any of the other shenanigans. So he voted for him because he liked the protectionist and tax cut policies.
He regrets his vote. I haven't spoken to her in months because she stopped talking to me when I kept show her that her "facts" were made up.
If you were going to do that though, it would be more like a 10-20% blanket tariff on all goods. No exceptions, no special deals, and you can't use tariffs as a negotiating tool. So that's not what's going on and the current approach doesn't make any sense economically
Of course it will result in higher prices, that's the point, but also the part politicians aren't too keen to spell out
You can see the archive going to "2015 and older" here https://hts.usitc.gov/download/archive
Sorry buddy but it is you who misunderstands.
Second, reducing consumer prices was not the goal of the tariffs. The primary goals were to encourage companies to move manufacturing to the US and to be used as leverage in negotiating other matters with foreign leaders.
Horseshoe theory and all that, populists gonna populist.
If I recall correctly, we vote for presidents, senators and the congress who have policy stances on a variety of issues. There are usually only two options, one of which stands for open borders, not enforcing laws, socialism and demonizing people who choose the other option on the ballot.
A large cohort of independents didn't vote for republicans, they voted AGAINST democrats.
This authoritarian model has proven very successful for anyone Putin and his aparatus has installed anywhere. Now it may be franchised even further.
It's depressingly funny too when you ask these people if they've ever been directly affected by said boogeyman and they'll say no, but the know someone that has. Meanwhile you can ask them things about healthcare, local government, and other matters that affect their daily life, and they'll swear the trans-immigrant-boogeyman de jour is has far more affect on their lives.
The point when Trump was elected was to make americans buy american and to get international companies to move their production to the U.S.
In Sweden they did something similar when they thought people were buying too much cheap stuff directly from China instead of from the middlemen paying taxes. The solution was to add a tariff on cheap goods from China specifically.
I don't enough to know if it works, but it's not a new strategy. In Trumps current politics though it's used more as a bargaining tool and not something that's supposed to stimulate the economy, is anyone even claiming it is the goal?
I like the idea of reaching across the aisle. However the divide is no longer the gap of a few feet. It’s a different world, with different rules.
I just checked yougov, and Trump has an 88% approval rating amongst Republicans.
https://today.yougov.com/topics/politics/trackers/donald-tru...
Do check, since one hopes I erred in reading the chart.
The victory of Trump is mostly the same process that gave the UK Brexit.
Just people acting based on the information they are being provided. If the other side is filled with feckless buffoons, and every source of news you have is telling you the same thing, then what else will someone do?
Tariffs make foreign imports more expensive. This dissuades people from buying them. Some of those people will instead buy equivalent American made products, now that the price difference has lessened. I consider that a good thing. There will be pain while local manufacturing ramps up (or forever, if it never does) for products that have no domestic equivalent. That sucks, but sometimes things need to suck before they improve. Paying off the national debt, for example, is something I support, even if we have to slash a lot of useful spending for awhile. I think most rational Republicans are voting for these sorts of things despite knowing they will make things temporarily worse, in the hopes of an eventual better. The left tends to never do this, for they are very attuned to the immediate suffering their plans cause. The right tends to be less sensitive to the short term suffering their plans cause; the right thinks that the alternative, a slow decline, is worth the pain to avoid. Trump has bungled the implementation of the tariffs, but I still support their use in general.
Fundamentally it makes no sense to me to support a minimum wage for your countrymen, but also support them importing massive amounts of slave made goods. You are creating rules on the supply side that the demand side does not have to follow, which only harms your own domestic businesses. Your own country's businesses have to compete against slave labor while paying living wages; for most manufacturing this is just not possible. You are incentivizing off shoring, which harms your working class, who have to compete with subminimum wage workers. Workers rights must be paired with tariffs, or every additional worker right is a demerit on his hireability against foreign workers without those rights! If you want your country to produce anything, and to have a strong working class, you either remove minimum wage, or you implement tariffs. We cannot simultaneously support strong domestic workers rights and mass importation of sweatshop goods that were made without them. It hollows out the country.
Edit: I am rate limited though I would like to reply to some of my interlocutors. I will reply later.
First, there have been huge numbers of manufacturing jobs in the U.S. that Americans simply didn’t want to do, so adding more manufacturing jobs they also don’t want to do isn’t going to help the economy. It’s the proverbial, “Americans don’t want to screw tiny screws into iPhones.” situation.
Second, for there to be any prayer of the tariffs working to boost local production (whether staffed or automated), they both cannot be capricious nor can they be applied to the goods and services necessary to acquire and deploy in service of increasing that productive capacity. If the tariffs can be waved around randomly like a threat of grounding a child, then they work only as an instrument of short-term extortion, not as a mechanism to expand an economic base. If the goods and services required for expansion are tariffed, then there’s a giant margin and time-to-ROI disincentive to make the investment as well.
Third, there is absolutely no good reason to apply tariffs to goods and services for which you have no plausible domestic substitute. There’s no point in putting tariffs on bananas and coffee in the U.S. unless what you want is to basically put the equivalent of a “sin tax” on bananas and coffee because you’re weirdly morally opposed to people eating bananas and drinking coffee or something.
Fourth, tariffs don’t ever make domestic equivalents cheaper or more affordable for consumers relative to comparable foreign imports. They just drive the price of all available options up to or near the baseline cost of goods plus the tariff. In the absolute best case scenario where everything about tariffs works out as perfectly as possible, you’re just adding margin for producers.
Trying to be globally competitive economically by using tariffs makes no sense. Trying to improve domestic economic conditions by using tariffs makes no sense. It’s a ridiculously shallow, nonsensical approach to attempting to do either of those things even when they’re used carefully and responsibly, but they were never going to be used carefully and responsibly.
The point of them was always going to be to use them as a means of paying for indulgences and dispensations.
Though perhaps that’s a preferable policy than to re-shore sweatshops and child labor to the U.S. as you’re implicitly suggesting should be done?
I can see how this stance can be justified for imports from countries who do not provide a meaningful minimum wage.
I do not see how this stance can be justified for tariffs on EU countries (where worker rights are strongly protected), especially when the basis for that tariff is to "punish" those countries for not wanting to change national borders against the will of the people inside those borders.
The observation was that the wage boost of a minimum wage can be undercut by importing cheap goods made with slave labor. Workers can't get hired, domestic manufacturers cannot afford to hire.
The point is not that snapping phones together is some aspirational career. The point is that a legally mandated wage floor is meaningless if domestic producers cannot hire at all because they are competing with goods made under conditions that would be illegal here.
If you support minimum wages and labor standards, you either accept trade barriers that enforce those standards at the border, or you accept offshoring as a structural feature that permanently shrinks the set of jobs available to low-skill workers. You cannot have both.
No one is arguing that people should be forced into factory work. The argument is that a living wage should be available to anyone willing to work, and that requires domestic production capacity. Whether those jobs are in manufacturing, logistics, or automated facilities is secondary. What matters is that the price system does not systematically reward labor exploitation abroad while penalizing it at home.
I'll respond with a question: why wouldn't you want a living wage available to anyone willing to work? One way to enable that might be to ramp up US manufacturing and production.
However, as evidenced by the current situation, the US economy doesn't support manufacturing all types of consumer goods that it demands.
I understand the pressure points you're arguing for but I don't think that the US society will be in a better place once those are enforced.
If everybody willing to work doesn't have access to a job that pays a living wage, isn't that a different issue? Maybe the government could have educational programs so everybody has access to getting the education needed for jobs that pay a living wage (those not offshored to China and others) but I guess that's too much socialism for the US.
But what about the other side of the coin - that exports will now become more difficult, because of retaliatory tariffs? How does that help your domestic economy?
Trumps solution seems to be to try to bully other countries into accepting tariffs and not imposing tariffs on American goods. But how is this supposed to work? Quite apart from the appalling moral and fairness aspects of this strategy, trashing the economies of other countries is a bad idea, because you want other countries to be wealthy so they can buy stuff from you.
Free trade has built the modern Western world, and has already made the US the world's leading economic superpower. I can't even see what Trump is trying to achieve.
Although as the comparison hopefully makes clear, you worrying about tariffs is missing the point, it's more a question of basic democracy at this point. I'm also somewhat concerned about your (edit: as in the USs) new found lust for Lebensraum, because again, that went well last time.
"""
Sturmabteilung (SA)
The SA was formed in 1921 as the paramilitary fighting organization of the NSDAP and protected party events. After 1933, under Ernst Röhm, it carried out street violence against Jews, communists, and trade unions, grew to millions of members, but was crushed in 1934 in the Röhm Putsch.
Schutzstaffel (SS)
The SS started in 1925 as Hitler's elite bodyguard under Heinrich Himmler and emancipated itself from the SA. From 1934, it took over police duties, concentration camp guarding, and from 1936, the Gestapo, directing deportations and the Holocaust.
"""
It sends a chill down my spine when I think about this comparison. I recently heard about an ICE agent who tried to drag an indigenous woman out of her car and said to her, “You're next!”
The drawings are not about the holocaust, but the fascism which has led to that point. The holocaust started nearly a decade after Hitler taking power. And I don't think anyone believes Trump or his puppet masters are seriously after an actual genocide; everything else and the victims they accept as "necessary" for their goals are the problem.
History can repeat itself, but never in the same cloths. Some details are always different.
They also voted for military conquest, they celebrated start of the war. Including or even especially so young men seeking to prove their masculinity. They were not voting to just bring better conditions for themselves. They voted to bring glory and violent victories.
They believed themselves to be strong dominant men who will bring good times to the aryan races.
For the rest, you're forgetting how humans work. Do you think the average MAGA voting is voting to destroy someone else? Or do you think they're voting to improve their lot? Voting for expansionism doesn't necessarily mean voting for world war. I'm British, it's very easy to compartmentalise invading a country, from developing a country, civilising, being a net good, etc, etc. What did the average USian think Afghanistan was going to be? Or Iraq? Do the USians who want Greenland imagine that's going to turn into WW3? Nuclear war?
The enemy are very rarely mustache twiddling baddies.
I beg your pardon?!? Who the hell do you think you're talking to? Read my comment again.
Many people were thinking Joe Biden was looking old... Until 2 months before the election when a faceless political elite replaced him with a candidate who had repeatedly lied about Joe Biden looking old. The American public might be stupid, but they don't like being treated as though they are stupid - which is exactly what the DNC did.
Once again proving that economists are engaged in mere astrology.
You also frame the argument that the last administration was tariff opposed, after they issued a 10% blanket tariff on the US' largest trading partner and tariffed Canadian wood products, directly causing house prices to skyrocket during the pandemic. You will never consider those impacts, because you're engaged in a fundamentally political argument, not an economic one.
The US has 4% GDP growth and a 2.7% inflation run rate. Wage growth is exceeding inflation again. Data doesn't lie, but economists do. Routinely.
[1] https://www.msn.com/en-my/news/other/economist-warns-of-moth...
[2] https://www.cnn.com/2024/11/13/economy/inflation-trump-econo...
[3] https://www.cnbc.com/2024/06/25/nobel-prize-economists-warn-...
I can understand that most people do not actually stay with these forecasts. The story hits NBC, you are completely outraged about this forecast made by these economists, the thing never happens, NBC has moved onto next disaster coming round the corner, next outrage.
If you work in markets, you are confronted with the relentless inability of talking head economists to just say mildly rational things. It is constant, almost every year now we have this latest economic disaster by economists in the periphery of political parties...no-one pays attention to these people, they have tenure, they make money from cashing in their political contacts not through actual correct forecasts (and yes, they always say that the thing they predicted will definitely happen next year now).
Stopped clock is eventually right. But there was literally zero information in the insane claims made in Q1. If you did not see this immediately, don't pay attention to these forecasts.
Could you imagine Amazon increasing their stock on hand by 30%? Maybe. Could you imagine them quadrupling their stock on hand? Seems unlikely.
Impacts should've shown up by now, most of the stockpiled goods would've been sold down.
The popular zeitgeist seems to reject the inflation numbers because of perceiving it to be higher, too.
I do agree it's probably not inventory, but the frequent changes to the policies may also be part of it too.
Astrology only really fell out of fashion due to a perfect storm of a bunch of different factors. The Church defacto banned aspects of it that implied external forces driving human behavior as that would contradict free will, and that happened just about the Renaissance was kicking off and all sorts of new astronomical discoveries led to no greater precision in astrological predictions, along with a more broadly skeptical shift in society, which gradually left it relegated to where it remains to this day.
"My evenings are taken up very largely with astrology. I make horoscopic calculations in order to find a clue to the core of psychological truth." - Carl Jung to Sigmund Freud, 1911
---
It's a great example of how what is deemed proper and scientific at one point in time is still heavily influenced by things that, in the future, will be considered 'obviously' nonsense. Even in far more modern times, it wasn't long ago that lobotomization was considered an appropriate psychological treatment. No less than JFK's sister [1] was lobotomized as a 'cure' for her irritability.
If I may ask, who are the people that do these predictions? What is there methodology and how do you know it's not luck?
He only started that tariff stuff when he took office.
Edit: Clearly I was not following things well enough, sorry for the wrong information.
Besides, he started the tariff nonsense in his first term - it even has its own Wikipedia page: https://en.wikipedia.org/wiki/China%E2%80%93United_States_tr...
Ps: there isn't really a trade imbalance if you take services into accounts but Trump calculated them only on goods as if that makes sense
I don't think that would have resonated with his followers at all though.
I’m adamantly against all forms of illegal immigration. There are plenty of people around the world that want to come here and are willing to wait in line. I’m perfectly fine with the intentions and methods of the current administration.
I’m in favor of doing whatever we can to increase our manufacturing base for the future. I’m perfectly fine with paying more for imported goods that I don’t actually buy anyway. Paying 95% for crap from China that I have no intention of purchasing does not impact me.
I hate all taxes and do not consider it charitable to spend other people’s money. Taxes are a necessity as we need to fund government functions. But it is those functions that should be limited. Because government is generally terrible at most of them.
I don't want to glorify German high schools but I find it hard to believe that those school books were so wrong that 40 years later it would make sense to return to a manufacturing-oriented economy.
If tariffs are a tax on the consumer, then you probably think the tariffs are in fact good ("American's aren't taxed enough").
But I'm more curious about what makes you think Americans aren't taxed enough. Why do you say that and do you have something specific in mind?
2018+: 37%
1993 - 2000: 39.6%
1981 - 1986: between 50% and 28%
1964 - 1980: 70%
1944 - 1963: 91%
1930s: 63 - 79%
1913 (income tax created): 7%
In most, though not all states, there's also State Income Tax. NYC also has a city tax on income.
Tariffs are a mid-long term strategy to encourage onshoring business, for reasons including military, national security, and political influence on foreign powers.
This is a complicated topic involving the global economy and evolving intercountry landscape. All these slam dunk takes are incomplete to the point of being wrong - and inflammatory.
My point is that your thoughtful response about reliable continuity, both inter- and intra- president, is not present in a lot of the comments.
The only people who need to back up to "industrial policy requires consistency and transparency" are those who are either incapable of or willfully deciding not to understand what's going on around them.
No, tariffs can be a tool in a mid-long term strategy. They are not themselves a strategy.
She absolutely thinks that tariffs magically make the US economy better in a very short time period. She thinks that the governments of the countries that she hates are paying them and that the tariffs are solving the deficit problem. She thinks that the number of manufacturing jobs in the US has skyrocketed.
No, that's the literal messaging from the US government. Trump has been talking about tariffs as the magic pill that fixes everything.
Then there are the sanewashers who try to act like there is a grand strategy behind taxing uhhh... bathroom vanities... then removing the tax a few months later.
Both are wrong, just different flavors and with different moral and intellectual culpability for being wrong (the latter are worse).
Seems safer for many business to just continue to operate outside of the US and get a more consistent business relationship with every other country in the world.
No. It isn’t.
https://www.cnn.com/2024/09/09/politics/fact-check-trump-van...
> “She is a liar. She makes up crap … I am going to put tariffs on other countries coming into our country, and that has nothing to do with taxes to us. That is a tax on another country,” Trump said.
> Vance said in late August that as a result of tariffs Trump imposed during his presidency, “prices went down for American citizens.”
Trump has said many times, including as recently as last month, that tariffs will make so much money we can get rid of the income tax.
This suggests that the man is not thinking coherently on the subject.
If someone decided to come up with a strategy to do something fanciful, like find the pot of gold at the end of a rainbow to solve their debt problems, would it really be worthy enough to be called a strategy?
This means that to the subset of HN crowd that don't have alternate sources of political news, this indeed looks like a bombshell.
Also, it's deeply naïve to assume tariffed countries would absorb the cost. Why would they? It's like going into a shop and asking for a discount because you just took out a loan. Why would the shop give you a discount for something you inflicted on yourself? And what makes you think other customers wouldn't ask for the same discount?
EU + South America start trading more while America shuts itself out.
The US might have an easy to choice to make after Trump. Regardless of who takes over. Simply roll back tariffs and instantly boost the economy. The protection aspect of tariffs will probably have proven to be mostly counter productive by then.
At least I don't see the US car industry doing any better when it can't export. Coal probably won't ever recover from being obsolete, etc. I think this mostly won't be controversial a few years down the line.
Prices for the same product are about 37.5% higher in the US. It's nuts and the reverse of how it used to be not long ago.
I paid EUR 510, which means $593. This is with all taxes included, so the price without tax would be about $490.
I have searched now the ASUS mini-PC on Newegg, and its cost is $679, around +38.5% more expensive.
This is wild, because indeed, until recently the price of electronics devices was significantly lower in USA in comparison with Europe, while now it is the reverse.
This is not a "Made in China" mini-PC, which might have been affected by worse tariffs.
Moreover, I have equipped the mini-PC with 32 GB DDR5 & 1 TB SSD, while cursing the more than triple price of DDR5 compared with last summer, so that now the DRAM has been more than a third of the price of the complete computer.
This configuration has cost me the equivalent of slightly less than $900, without taxes. The same configuration has a price on Newegg of almost $1200.
In a sense I am happy. All empires decline. This will decline USA forever.
Suppliers in China are dropping prices to offset the tariff impact - this is what I see in my direct industry and also in many adjacent ones. This is benefitting other countries that don't have Tariffs on Chinese goods since they can buy cheaper as well. I suspect this is a significant factor in the GBP/EUR strengthening in relation to USD. There was a point where there was such a pronounced impact to imported goods that the cost of shipping a container from China to US went from ~$3500 to <$1500 pre/post Tariff.
Large manufacturers (automotive certainly, but also raw materials production and component production) are actually moving facilities to the US, which was one of the intended effects.
US manufacturers are enjoying some price relief as landed costs of chinese-produced goods are increasing. Hard to quantify what this means but the frustrating part is that they are not reducing their prices just enjoying higher margins.
Countries outside the Tariff zone are enjoying more trade - Canada is a very real example of this policy backfiring - they just walked back the Chinese Automotive Tariffs in exchange for relief on agricultural reciprocal tariffs. Mexico is entering into similar agreements with non-US trade partners. Some products are releasing in non-US markets first and at lower costs than they are in the US.
US-sourced chipmaking is accelerating - Intel's new fabs are probably the most prominent example of this (albeit they are slow to pick up volume - I expect this will shift with TSMC rationing production to brands like Apple and Qualcomm).
I think the increase in cost to consumers is painful and that the current Tariff rates are excessive + there is a lot of "cheating" where Chinese suppliers are declaring lower cost of goods on import to reduce the landed cost of Tariffed goods - there doesn't appear to be enough resources to police this policy fully.
All in all an interesting economic experiment and it will certainly take years for any of these realities to have a measurable positive impact domestically.
What countries are those? As far as I know, most important markets have great tariffs on Chinese goods.
They deliberately disinformed the public, there is blatant evidence that the news anchors were aware that they were lying. Not just bending facts a little or opining, but knowingly and purposefully lying.
The pretext of freedom of expression, and more narrowly freedom of press should not *continue* to apply to businesses/individuals which are found liable/guilty of such destructive behavior for the society they operate in.
The same should apply to people like Alex Jones, you had your chance to use freedom and you have wasted it, move on to another profession.
I believe that admission was because ending the trial and eating the judgement, was less damaging than allowing the light of discovery and trial ingress into their workings.
I still believe the SCOTUS is trying to uphold the principles in the Constitution, for now. And there are already limits on what on can say in public, yelling fire in a theater when there's no fire is not far from what FOX is doing. Lying at this scale to cause panic based on such lies has demonstrable deleterious effects on society. The effect is delayed due to the scale of the target groups, but the principle is the same and courts/juries are able to observe this when it happens.
His argument was in defense of the process to uncover truth.
Given that Fox has clearly said they cannot be taken seriously, and that they were from inception created to muddy the waters and wage war for political gain, they are an enemy to the process that was envisioned back in that era.
If someone is demonstrably selling false goods, and multiple sources have evidenced this, as has a court of law, should that all be dismissed because every single individual in America has not taken the time to look at the evidence?
At some point you abdicate roles and responsibilities to others, so that they can do the job of ensuring that a fair debate takes place.
It’s true on its surface - most people don’t know about economics, across all political spectrums, and so rely on leaders (which I thought is what liberalism advocates for?).
It’s not a helpful model if you want to understand what’s going on. So then the interesting parts to explore are the reasons they want to believe it, and the reasons given by the educated economists who also support the position
> the educated economists who also support the position
> the tariffs are something other countries are paying the US
I'm quite sure the provided definition of a tariff is accurate. Given that, who are these economists and what are the reasons they give for supporting this belief that the exporters (other countries) pay the tariff?
The tariff is an artificial increase in the cost of the good, like a tax or regulation. If the producer thinks consumers won’t buy at the full price they may eat some profit to keep the transaction. Or they may not.
Funny how the in-depth analysis is strictly in one direction, rathcheting the Overton window forever rightward.
On one hand we had mountains of articles about "economic anxiety" & "The MAGA next door" in 2016. On the flip side is "Fuck your feelings" and never a "humanizing, fish out of water" longform article about the life of a Democratic Socialist in a small Texas town after Biden 2020.
I’m not telling you it’s a moral obligation to understand. It’s in your interest.
Econ 101 normally covers tax incidence (which side bears the burden of a tax). It has a lot to do with elasticity of both demand and supply. If foreign exporters can easily shift to other markets or adjust production (elastic supply), they'll pass most of the tariff cost to consumers through higher prices. If American consumers have few substitute products (inelastic demand), they'll end up absorbing most of the cost. Of course if the opposite is true, the sellers end up eating the tariff.
The reality is that tariffs typically get passed through to consumers as higher prices, not absorbed by exporters. The exact split depends on how flexible each side can be, but empirical evidence shows consumers usually bear most of the burden.
What do you mean by "pass the cost"? Exporters do not pay tariffs, importers do. The exporter doesn't give a shit because it doesn't affect them at all.
This is one of the most fundamental misunderstandings of how tariffs work in the first place. The entity that's picking up the cargo at the port is who literally has to pay CBP for them to release the goods. The middleman (say, Walmart) may pass the cost to customers or whatever, but tariffs are entirely inconsequential and irrelevant to foreign exporters. There's no way to send a bill to a foreign entity demanding a tax for some goods that have arrived at a port, after all.
Simplified: a seller can lower their price by the amount of the tariff. The buyer is responsible for paying the tariff bill, but the seller is the one eating the cost at the end of the day, it is "passed" to the seller.
Alternatively, the seller can refuse to budge on price. The seller makes the same amount per unit, and the buyer gets the privilege of paying the tariff while not receiving any sort of break on the price. The entire cost of the tariff is "passed" to the buyer.
Well that’s not true. Otherwise you are going to have to explain why so many outside the USA were upset with tariffs, and why there were retaliatory ones applied on the inverse.
I make no other claim that your quoted assertion is wrong.
One big problem with arguing about this is that it will take many years for the effects of the tariffs to settle. If there’s new opportunity for local competition of goods that we’ve been importing, new companies can’t form and meet that demand over night, it will take longer than the president has to see that succeed, which certainly hasn’t stopped him from claiming it already has.
Tariffs rates by this administration are capricious and punitive, not targeted and strategic.
This isn’t the first time tariffs have been used in a country to push purchasing preferences. The problem is that it hurts them and it hurts us, it’s just a net economic drain and doesn’t effectively achieve the local economic boost that some want it to, especially in today’s global economy where trade has become so integral that we no longer produce many of the products we buy, and therefore tariffs can’t fix. “There is near unanimous consensus among economists that tariffs are self-defeating” https://en.wikipedia.org/wiki/Tariff
The only fruit of this is real economic pain for the American consumer. But that was likely the goal, so mission accomplished I guess.
Countries geographically closer to the USA might reason differently because close countries usually trade more and they have more to lose. But even in this case, if a Mexican or Canadian company can find other markets or discovers that it can keep selling at the same price, they will not bear any of the burden of the tariffs.
Russian like sanctions were applied to Italy about 100 years ago because of colonial wars in Africa. Despite the sanctions lasted only 6 months, Italy discovered that they ended up trading less with the usual partners and more with others. Tariffs are somewhat similar to sanctions as they apply friction to trading.
Isn't the only thing that could matter - apart from strategic considerations of financing a loss for a time - if the margins are big enough? Who wants to pay for people to take their products below the full cost of making them, apart from some investor-financed hype startups?
I wonder what supply and demand curves look like if you keep telling people that the increased costs will be paid by foreigners and not them?
I assume it has an impact eventually but it must dampen the speed of response if people believe that.
But, integrally the whole package is just wishful thinking.
I mean, maybe it was elastic for imports from Heard and McDonald Islands. Penguins don't care about margins after all.
Such protectionist practices were used by China to bootstrap their own automobile industry, before they became competitive in the global market. Of course, China had surplus capacity of untapped cheap labor, which America does not.
Barring an evolution in automated manufacturing, or an overhaul of regulatory policy, I'm pessimistic it's possible to accomplish the same in the US. But, in principle, tariffs have a valid place in supporting an emerging local industry.
First you subsidize and support the creation of currently not commercially viable chip fabs on-shore. Literally handing companies money under some obligation into the future.
Eventually the on-shore chips are produced, but they have higher total cost of ownership for the users: Logistics may be cheaper due to less distance, or more expensive because they are not well-trodden paths yet. Production costs like labor, water, energy could be higher. And the chips could just have higher failure rate, because problems in the new processes need to be kinked out.
But to get local consumers to switch to these switches, one applies tariffs to other sources of chips so the on-shore chips become more competitive artificially, until they become actually cheaper and competitive.
The way it is threatened here isn't in the use case of tariffs at all from my limited understanding.
I'm mostly responding to the position that tariffs have no place in economic policy, when we've seen them used successfully in other countries. Should Congress pass a bill legislating tariffs, then I could see them having more of the desired effect, though as I said I'd still be pessimistic without broader changes.
It was genuinely shocking how many people from the latter group just could not understand the absolute basics of supply curves and demand curves.
The upside is that I was able to help them understand it by offering tutoring, where I was in limited supply, and there was endless demand for my services!
However, they rarely read books and indeed most don’t read at a university level.
Rarely reading books is also not tied strictly to the US.
The US is actually pretty illiterate compared to peer countries.
Even as a kid I was confused. Where else is the money going to come from?
There are circumstances where much of the burden of increased costs is borne by the producer. When demand is very elastic (consumers are price sensitive, or there are many good substitutes), and supply is inelastic (its hard to change the level of output), the suppliers will eat the cost.
Which would be a nice balance to the way productivity has rocketed since the late 70s, and has mostly flowed to the top 1%.
Ultimately - and predictably - wealth hoarding becomes economic self-harm. You need distributed prosperity if you want diverse growth and economic and social stability.
Out of that price: $3 goes to production cost, $3 goes to tariffs, and $4 goes to profits.
Now the taxes/tariffs are doubled. The producer can up their price to $13, meaning $3 to production, $6 to tariffs and $4 to profit.
But customers might not accept any price higher than $10. They won't buy.
So instead you continue selling for $10 and your costs are: $3 for production, $6 for tariffs and $1 in profit.
That's what people mean when they say that companies are paying the tariffs. They're not profiting as much as before.
In practice it's usually a mix of higher consumer prices, lower company profits, or even some products not being imported anymore.
Doesn't really work when main reason for product existence on market is either "no equivalent" or "this particular subgroup is only imported" (say given specifically tasting cheese).
> "Foreign exporters absorb only about 4% of the tariff burden-the remaining 96% is passed through to US buyers."
so yeah, the exporter does pay some burden. it's not binary. indeed, tariff exports can be designed in a way to dial either direction. certainly, we could dial foreign exporters burden to 0% – and we could dial it back up to 4% (where we're currently at). but, 4% likely isn't a hard ceiling, either. Of course, the 4% number is an aggregate, not the blanket value across indidual goods (or services).
finally, the effect of tariffs is argued to be wealth transfer to the US Treasury. this is worth thinking harder about. but also, exports may change from whom goods are purchased. thus, it's a diplomatic policy, as well.
Does it change who customers buy food from? No, because everyone increases their prices regardless of if they’re impacted by tariffs or not.
The 2018 washing machine tariffs are a clear cut example of why tariffs are a garbage strategy.
https://www.warrantyweek.com/archive/ww20250522.html#:~:text...
Price Pass-Through: Studies found that 100% of the tariff cost was passed through to consumers, resulting in an estimated $1.5 billion in additional costs to American families in the first year. The "Unexpected" Dryer Rise: Although tariffs only applied to washers, the price of dryers (a complementary good often sold with washers) also rose by an equivalent amount—approximately $92 per unit—as manufacturers increased prices on laundry pairs. Job Creation Cost: While the tariffs helped domestic manufacturers like Whirlpool, LG, and Samsung shift production to the U.S. and create about 1,800 new jobs, researchers estimated that consumers paid over $800,000 annually for each job created. Outcome: The tariffs resulted in a 49% decline in imports from 2017 to 2019. They expired in February 2023, after which washer prices decreased.
> Isn't this literally economics 101? How did we ever even end up imagining that tariffs are somehow paid by the exporter??
My response was that it's not binary, but a mixed case. And, furthermore, from the perspective of an individual exporter, their export profile may change if goods and services are purchased from a different exporter.
E.g. if the same good may be cheaper without a 25% tariff, then you'd expect the incentive to pay less to have some effect.
The US Treasury would still get money, but the exporting country might change.
It's a national sales tax really.
It's constantly disappointing how the apparent intellectuals who frequent and operate HN will rally to that side out of libertarian convenience and out of annoyance and disgust at "wokism". And then will inevitably be shocked when everything goes sideways again. Hopefully the education will stick longer this time than it did after G.W.Bush.
[1] https://en.wikipedia.org/wiki/Reality-based_community
[2] https://en.wikipedia.org/wiki/Alternative_facts
[3] https://www.npr.org/2020/09/29/917747123/you-literally-cant-...
[4] https://mashable.com/article/alex-jones-defense-performance-...
Consumers are just buying from other sources (domestically or otherwise) or not buying because it is no longer worth it.
There are a lot of reasons why these tariff's are bad, but economically, it is not a bad thing for people not to buy things they do not need, or to buy them from a domestic producer. Consumer spending actually increased last year, and inflation is low.
https://www.npr.org/2026/01/14/nx-s1-5638908/walmart-prices-...
What if that was the intended result?
I would be 100% pro free trade between nations with identical labor rights and environmental protections, but that really isn't what free trade is about, is it?
Perhaps the US should charge them negative tariffs until it gets up to snuff.
And, of course, Hanlon's razor is very much relevant here, although certainly it doesn't apply to everybody in Trump's inner circle. Some of them are very much competent and malevolent.
[1] https://open.substack.com/pub/vladvexler/p/we-need-to-talk-a...
For example if I shoot Batman in the back when he's fighting The Joker (because Batman is a vigilante so that's illegal, gotta take him down), and later make a statement to the press after Joker has been sent to Arkham "You know I think Arkham is a good place for that guy, he got what he deserved", I have acted for and against The Joker's interest, which is a good cover for me as an agent of The Joker.
I have often seen Trump doing stuff that is counter Russia's interests, but stuff that seems extremely weak sauce in contrast to weakening Nato, as just one example. It is spycraft 101 that you give your assets some simple stuff they can do against you, to make them seem trustworthy.
I fear that they already decided that issue when they chose not to intervene and now have the excuse of "lol well can't undo it now" ready to go.
Edit: It appears Trump & Co intend to replace SCOTUS if they lose the tariffs ruling ... https://www.nytimes.com/2026/01/19/us/politics/trump-tariffs...
--------
There does seem to be indications that the actual tariffs collected seems far lower than the actual tariffs promised, likely just half of what was promised:
https://www.nytimes.com/2026/01/03/business/economy/trump-ta...
It would seem that as elected representatives of the people (we are literally their boss), they can't do that without asking us first. The whole point of them existing is to give us power and limit the executive's power, not the opposite.
Because Article One vests "all legislative powers" to Congress, they cannot delegate legislative powers to the Executive and Judicial branches (because then not all legislative powers would be vested with Congress).
https://en.wikipedia.org/wiki/National_Federation_of_Indepen...
The 2017 TCJA removed the individual mandate. Presumably, that is what FrustratedMonky and kccqzy are referring to.
Obviously, the ACA made it so all health insurance premiums have a large "tax" component, due to the extremely narrow underwriting criteria health insurers are allowed to use. The individual mandate had previously applied a tax to all taxpayers, but after TCJA 2017, the tax is only paid by people with health insurance.
https://www.healthcare.gov/how-plans-set-your-premiums/
https://www.irs.gov/affordable-care-act/individuals-and-fami...
>Enacted in December 2017, the Tax Cuts and Jobs Act (TCJA) reduced the shared responsibility payment to zero for tax year 2019 and all subsequent years.
If the importer took on most of the burden that would defeat the purpose of the tariff.
It is a federally funded research organization (part of the family of Leibniz institutes) similar to a university but without teaching. Here's a list of the others [1].
These are independent, high-quality research institutions without political money or a designated political agenda.
[1] https://www.leibniz-gemeinschaft.de/en/institutes/leibniz-in...
If a think tank from a non-tariffed country would write this piece, they risk getting tariffs tomorrow.
And would Americans trust a (US) think tank in the juristiction of the US government right now?
What source would you trust on this matter? Or rather: who has published something we could look at that contrasts these findings?
[1] https://mediabiasfactcheck.com/kiel-institute-for-the-world-...
Which sources would I trust? I feel it's important to read broadly, and (on a long scale) improve your ability to discount biases. To that end, I'm not recommending anything, but everything in proportion.
If you add that information, if you really think it adds any value, after discussing what's actually in the study the comment would be sooo much better.
Your comment serves nothing but to suggest anew that Americans _should_ be suspicious. Either that was your aim to begin with or you’re okay with that result.
What reason do you have to trust this "Kiel Institute?" I would bet my life you've never even heard of them before today.
"There's been major impact to some things" -> so bad things have happened
"but for the most part the economy has hummed along without a blip." -> so despite bad things happening, just plug your ears and sing loudly?
As for prices in Walmart, they HAVE gone up. Several companies have had press releases stating they need to increase prices because of tariffs:
https://www.cnbc.com/2025/05/31/trump-tariffs-here-are-the-r...
"Retailers like Costco and Best Buy said they have already raised some prices, while Walmart, Target and Macy's plan to follow suit"
I'll be the first to say that given the circumstances our underlying economy and people have held up better than complete collapse. But you can't pretend this is not happening.
How did the US become this insane this fast - I'm not even against tariffs but you need to decide which industries to use them on e.g. steel, drones, maybe electric vehicles - blanket tariffs by a mad king are really difficult to fathom. When will congress wake up and will it be too late?
It's also extremely hard to pick winners which is why the Chinese just fund everyone and let the winners cannibalise their less successful competitors. I'd be more confident of Chinese semiconductors being ahead over the medium term than US without ASML.
Unfortunately (for sellers) tariff decrease trade volume so even if only 4% absorbed by a seller they have much bigger losses from sell volume decline.
Economy is not a zero sum game - almost everyone looses from tariffs - consumers no longer can afford the same some things they did buy in the past because tariffs increased prices. Sellers cannot decrease prices because in many cases it will make their business unprofitable but they still loose on the volume.
As a Canadian, I now avoid American products and retailers as much as possible. This isn't just political (Trump has repeatedly threatened to annex Canada). This is about filthy lucre too.
Anything manufactured in the U.S. with tariffed inputs (e.g. Steel, Aluminum, softwood) is more expensive now. Foreign goods that merely pass through the U.S. on their way to Canada are not supposed to be tariffed, but many U.S. retailers simply don't do the paper work necessary to make that happen, no doubt because the Trump administration has made that paperwork so chaotic and difficult to do.
The upside is that Americans aren't just paying for 95% of these tariffs, they're losing export business from the rest of the world too. On top of this is the additional cost of unpredictability. Is the U.S. about to slap additional tariff's on the EU because of Trump's Greenland ambitions? If you're planning a project in Canada, you'd be wise to avoid any U.S. products that use EU inputs for the foreseeable future too.
I will contribute $$$.
In Europe, prices show the price INCLUDING sales tax (VAT, typically 20%). What you see is what you pay at the register.
In the US, prices show the price BEFORE sales tax (national average circa 7%). You pay 7% more at the register than what you saw.
I wonder if we could update US pricing so that the tariff was collected at the cash register, just like sales tax is, so that people could see that they were the one paying the tax.
yes, I see the obvious practical difficulties with this. It is a though experiment, nothing more.
As someone in India, this statement is incorrect. There are no consumer receipts in India that show the import duties (which is what tariffs are) as an amount or as a percentage. There are plenty of goods sold in India that are imported, duty paid, and the costs are passed on to the consumers (with no explicit mention of that in the invoice or receipt).
You may be confusing these US tariffs with local taxes in India like GST. In the US, sales tax is shown in the consumer receipts (if or as applicable in the state, county, city, etc.).
In India and in the US, import duties are not shown in consumer receipts, except in the case where an individual is importing something and is liable to pay the duties and levies directly. Indians would probably revolt if they actually knew how much customs duty they’re paying for all the goods they buy individually.
Its still a dumb idea since any following administration could reverse the policy, so why invest in local manufacturing?
Without an opinion on the actual claim here (although I'm skeptical of a claim of 96%, given the relatively moderate inflation in the US in 2025), I think this quote by itself (first bullet point of the abstract) should disqualify this as a serious analysis - no academic paper uses this language, only biased think tanks, and the fact that it's a German think tank doesn't change that.
Neat as in fantastic - it literally can't get any better - for the oligarchs. Tax the poor, and tell them we're collecting money for them, from the foreigners.
Raise and lower the rates willy-nilly, no need to really justify why you're squeezing who.
Tariffs are like a military tactic, its not good for the domestic economy, its good for the military.
‘US Americans’ makes it sound as if a distinction is being drawn between Americans inside and outside of the US or something
E.g. in Germany, inhabitants of the US are usually called "US amerikaner", so this is a direct translation (the Kiel institute is in Germany).
It's just Germans being stereotypically precise about things (and reminding citizens of the USA that they aren't the only people in the Americas).
"US Americans" is routinely used to name "people in the US", since "Americans" is ambiguous, and "US citizens" is more restrictive and explicitly excludes residents that are not citizens.
Not true. Tax burdens can fall incredibly unequally depending on market dynamics.
Most directly, when foreign products become more expensive, people may choose a local product that was previously seen as too expensive. So it generally has a negative effect on the foreign economy and boosts local production.
Unfortunately, it also drives the foreign companies to become more efficient so they can get their prices back down, while giving the local producers a crutch to justify higher prices and stagnate.
And there are other side effects, and all of the side-effects have side effects of their own. Economies are complicated.
Non-US Americans don't seem to care, and they think it's silly that I'd wonder whether they did.
It still feels dismissive and rude, so I try to avoid it -- but evidently it's not a significant or widespread concern among those with standing to be offended.
The broader term is "North American"
First of all, the summary of the article (I did not read the article) clearly states that foreign exporters did not eat the tariffs, instead they held their prices, American consumers paid for the tariffs, and that trade volumes collapsed.
"trade volumes collapsed" - so, Americans did not buy foreign goods that they did not need/want at those prices, or found an alternative (presumably American) product to substitute. American consumer spending increased in 2025 and inflation settled down to a reasonable level. It seems that consumption shifted to domestic products.
That does not appear to be a good outcome, economically. . Second, tariff's are a tax. No sh-t. But so are VAT taxes, which are very high throughout many countries, and no one seems to believe they are the downfall of these countries. You can argue which is "better" or "fairer", but from the consumer point of view, VAT makes everything more expensive and tariffs make only foreign goods more expensive. You can say that VAT forces everyone, foreign and domestic to compete and be more efficient, while tariffs penalize foreign production and rewards domestic production, even if some domestic production is less efficient. But both are taxes, and at least the American consumer can choose whether or not to pay that tax.
While I disagree with tariffs, and especially disagree with how they are being wielded, the economic effect that they have had on Americans in 2025 is to shift away from foreign imports, buy more domestic products, and they have not increased inflation. Neither did the tariffs on Tr-mps first term on China.
If a 20% VAT was instituted, I would think that that would have had a much larger "tax" effect, and would have taken away peoples choice on whether or not to pay that tax. Yet, the VAT would be considered "good".
I think the biggest issue here is the serious negative impact on our relationships with our allies.
What is misleading is labeling a global system marked by large, persistent imbalances as benign or indicative of "free trade". A healthy free trade system should have balanced trade, and the reasons that are not are unfortunately the fault of surplus nations like China or the EU. I know, its unintuitive, but going back to Bretton Woods to IMF analysis will back this point.
P.S if one wants to note the grocery shop analogy, a better analogy is that if you count up all your transactions, your income should exceed your spending, or else you're probably in trouble. That's roughly the problem here, but made more complex with the shenanigans of the US dollar.
That is its own kind of burden. We are shooting ourselves in the foot here, but but I think we're getting the other guy's foot to the tune of a bit more than 4%.
It's mutually assured destruction logic. I hate everything about it, but this seems like a mischaracterization of its efficacy.
https://fortune.com/2026/01/18/europe-retaliation-8-trillion...
Meanwhile, he puts all your tax dollars in his and his friend's pocket...
“Dear Jonas: Considering your Country decided not to give me the Nobel Peace Prize for having stopped 8 Wars PLUS, I no longer feel an obligation to think purely of Peace, although it will always be predominant, but can now think about what is good and proper for the United States of America. Denmark cannot protect that land from Russia or China, and why do they have a “right of ownership” anyway? There are no written documents, it’s only that a boat landed there hundreds of years ago, but we had boats landing there, also. I have done more for NATO than any other person since its founding, and now, NATO should do something for the United States. The World is not secure unless we have Complete and Total Control of Greenland. Thank you! President DJT”
Given that, should it be any surprise at all that Trump has been gaslighting America on who pays for his tariffs?
And guess what mechanism he's brought to bear on the countries that do not see things his way when it comes to Greenland?
Talking about Kiel, the non existent document was signed there: https://en.wikipedia.org/wiki/Treaty_of_Kiel
It's entirely possible he's not even informed enough on the issue to be intentionally lying.
Unlike Trump’s first term, his cabinet and agency heads are little more than loyalists and yes men. Checks and balances are gone. Independent thinking is gone. The president has long been an incompetent racist and malignant narcissist and the country (and world — for now) are suffering as he unleashes whatever cruel, imbecilic impulses that cross his mind. Add to that the fact that he’s quite clearly unwell.
I thought what they'd do is push for a national sales tax (which would be regressive) with the promise of repealing the income tax, but when it came to the last part they'd just kind of conveniently forget about that and we'd end up with a huge national sales tax on top of existing income tax.
But this works too.
But here’s the hard truth: the US has needed to raise taxes for decades given its inability to reduce spending.
Hence they massively inflating runaway deficit. If this is the only way Americans will accept tax increases, and they aren’t willing to decrease spending, then this policy will ironically end up being the only way forward to climb out of the financial hole.
I don't mind people being ignorant. We all are at some point. We all learn. But what's really depressing is that people who wear their ignorance and intentional unwillingness to learn like it's a badge of honor.
In the early 2010s I had discussions with people who pushed the idea of the resurgence of anti-intellectualism in the US, which I dismissed at the time. I think about that a lot.
The dumbing down of American is most evident in the slow decay of substantive content in the enormously influential media, the 30 second sound bites (now down to 10 seconds or less), lowest common denominator programming, credulous presentations on pseudoscience and superstition, but especially a kind of celebration of ignorance”
Carl Sagan, The Demon-Haunted World: Science as a Candle in the Dark
There's an argument that domestically produced goods would substitute for imported goods leaving the market, but markets are so global and intertwined now that even domestic goods have imported inputs that are also affected by tariffs, and there often are no domestic goods or not enough domestic goods produced to act as a price-competitive substitute, and companies are not going to invest a ton of money into expanding domestic capacity, when tariffs are imposed on the whim of a lunatic and will probably be eventually tossed out by the supreme court or congress.
Go actually read the pdf. Their methodology conflates any and all price increases of foreign goods as being a burden bore upon Americans. No talk of purchasing habits changing towards domestic products. Nope. Oh and does it account for recent price increases across the board related to inflation? Nope. It (I would argue intentionally) does not control for that at all.
Pure propaganda from a foreign think tank to convince you to go back to policies where American exports got taxed, but theirs did not.
Yeah no need for coffee beans in USA.
Seems more like from taxing companies to taxing citizens.
For serious penalty, all those TechBro cronies need to have all assets seized. They are imcompatible with democracy.
Unfortunately, this didn't get a lot of attention, but they also threw a flash-bang grenade and tear gas at a car filled with six children. A six month old baby had to get CPR from her mom. Two kids were hospitalized.
None of this is acceptable. And their overtly violent behavior has nothing to do with enforcing the law.
Finally the “right people” are getting hurt.
That is how they see it
I think Americans past the point where individual instances of police violence can shock us into taking political action (which is extremely risky in any case). It’s going to take kilodeath crimes, I imagine.
This is clearly untrue, and you must be in a bubble if you think this
Otherwise "broad" producer price index down primarily due to coal prices getting creamed by renewables, also cheap RU gas. When fossil/input prices drop, PRC PPI always drops. Industrial profit index for manufacturing sectors up 5-10%. Note broad industrial profit index down because it heavily weights state owned / SEO fossil sectors (aforementioned coal+oil dropped by 20-40%). Decompose industrial profits and story is PRC manufactures getting cheap energy and cheap inputs while growing profits more than they lower prices, aka why PRC winning trade game in the first place.
Looks like around ~2% a year
Click to, say, 3 year view of https://ycharts.com/indicators/china_producer_price_index
Our economy remains robust (down jackets moving like mad in Minneapolis) and the number of native-born Americans and legal aliens working is higher than ever. Illegal aliens are either heading for the door or being pushed out the door.
USA increased payroll employment (+584,000 jobs in 2025). Unemployment rate has decreased to 4.4%. We show gains in food services, healthcare, and social assistance, but retail trade has declined (necessarily). The labor market is stabilizing and expanding more slowly than before. Private payrolls have risen an average of 43,000 jobs/month over the past six months. Wage growth eased and average hourly earnings are up 3.8% over the past year.
We're much better off and it is showing: the US economy grew by 4.3% in the 3rd quarter of 2025, while Germany's GDP grew by 0.2% for the year. The German economy is so far down, some websites quit updating website statistics years ago, e.g.:
https://georank.org/economy/germany/united-states
The Kiel Institute may be trying to draw German voters' eyes away from their government's poor economic policies, e.g.,
"Germany’s economy is so bad even sausage factories are closing"
https://www.economist.com/europe/2026/01/15/germanys-economy...
Of course that is another "tabloid" journal of the British strain. Told you they're really, really good at feeding the flames with their journalism.
[Strains of Carly Simon's "Nobody does it better,... makes you feel sad for all the rest..."]
https://www.bing.com/videos/riverview/relatedvideo?q=nobody+...
> The reason for tariffs is NOT to reduce prices but to bring production (jobs, capacity) home.
Tariffs can be used for many purposes. I would say this is administration is clearly not using them to bring jobs home. Earlier tariffs were lowered/dropped when trade deals were signed, and the current ones are clearly a way to strong arm Europe to giving up its territory.
> Unemployment rate has decreased to 4.4%.
Decreased from where...? Not including the pandemic, 4.4% is the highest rate in almost a decade. Unemployment is clearly rising: https://www.bls.gov/charts/employment-situation/civilian-une...
"Flash Report: U.S. Jobless Rate Ticked Down in December"
https://www.stlouisfed.org/on-the-economy/2026/jan/flash-rep...
FTFA:
"The unemployment rate in the U.S. has decreased to 4.4% in December 2025, down from 4.5% in November. This decline follows a period of rising rates, with the economy adding just 50,000 jobs in December, indicating a slowdown in job growth. The labor market is showing signs of stabilization, with the broader U-6 unemployment rate easing to 8.4%."
Federal Reserve Bank of St. Louis
Also, this obsession over the importance of accessing US consumers feels ridiculous. If Americans aren't buying then it means more stuff for everyone else.
EU/China etc. sends actual things to US and US sends back dollars that are created out of thin air. It must be a restructuring pain more than anything since US doesn't actually export much goods. With the proliferation of cheap and available solar energy the trade with US can halt, endure the pain of restructuring came out of the other side with using the produced goods domestically instead of sending them to US and replace the US services with domestic ones. Then US can produce their things that they consume and have 350M market for the US companies instead of 7B.
It almost looks like Trump is Pushing for US irrelevance, its vey strange. Why would US be looking to abandone such an advantageous position? The people in the rest of the world are working their asses off, breathing toxic air just to obtain dollars.
I suppose the issue would be for those on the lower end of the earnings distribution, as they pay little to no federal income tax, but would be hit by a consumption tax. Though I do wonder if we could see wages increase when we don’t have to compete as much with low production costs in China.
Also, reduced competition from China does not imply higher wages unless labor has bargaining power and firms pass gains to workers. Historically it has been passed to shareholders not workers.
Finally, tariffs mainly protect manufacturing jobs. AI threatens white-collar and service work
Tarrifs are a restrictor plate on a big block V-8 engine.
Take it away and you get more power, more noise, more freedom.
Don’t you want more freedom?