Tariffs: Why Is It Fine When Others Use Them, But Not the US?

more people have good jobs in manufacturing with good wages, instead of bad low-paid service jobs

Why is 'manufacturing' a good job with a good wage? Factory work tends not to be a good job with a good wage.

There probably weren't many "crap" clothes made and sold at all. My recollection of what my mother and grandmother used to say is that pretty much all clothes were of a reasonable quality as a basic expectation, which is why they moaned like hell during the nineties and noughties as the quality plummeted with globalisation and the race to the bottom.

Do we want a country where reasonable jeans cost £60-70, but more people have good jobs in manufacturing with good wages, instead of bad low-paid service jobs?
Jeans (and everything else) would have to be better quality and we would get rid of the environmental catastrophe of over-production and over-consumption of shoddy goods just to keep the consumer treadmill turning.

If this is what we want, tariffs are part of the answer to how we get there.

Most people talk a good game re purchasing/boycotting other countries products but the reality is they fail to live up to the talk.

It's like environmentalism. There is always an excuse. I NEED an SUV to cart around my 3 massive dogs.

The only thing that really works is government intervention. In fact I would argue it is one of the things we need governments for and if they aren't doing it then there is little point actually having them.

Excuse me while I follow this mild diversion? The price of these jeans in today's money is £62, according to the Bank of England's trusty calculator. They wouldn't have been 'good' jeans which, iirc, cost around £12 and I saved up for months. These were probably made in India, which was the China of our day - along with Japan!

Yes, folks, Made in Japan used to be what Made in China is today. They didn't make our clothes, but no end of plastic doohickeys and low-priced kitchen appliances that you would kind of expect not to work properly. Also similar to 2020s China, Japan simultaneously put out precision engineering our factories could only gasp over and was quietly forging ahead technologically. (Well, our factories can't even gasp now, they're all dead.)

Don't ask me what that is on the guy's right leg or why 1970s models all had to stand with their legs apart like Theresa May at that conference ...

This is a fair point. If we move away from the sweat shop, unethical cheap labour model the more likely the US can counter.

How possible it is to do likely increases the fewer people working away at producing those cheap goods for the west.

Also you’ll often see on a why are our high st dying threads a mention of Temu etc. We seem to dislike that impact but not what could counter their proliferation.

I don't understand all the financial implications but his whole attitude is that of a narcissistic bully which immediately puts people backs up. He uses threats and downright nastiness which blurs what he's doing.

I assumed the website meant $10 to $30 in today's money. I stand corrected.

Checking the Bank of England inflation calculator, £8-£25 in 1970 prices is the same as £107-£337 now

However unpalatable it may be, western countries particularly will always be in need of cheap products.

It's almost like it wasn't possible for us to survive until the 90s when large volumes of trade began with China.

I think it is also something of a simplistic view to believe China is all about cheap products. For example they are first in solar panel production. But my belief is they got there through protectionism rather than through competition. Of course people can argue pretty much indefinitely over what constitutes protectionism.

I think there is also a lack of understanding of what is cheap to produce in China. Anything low skill labour intensive is cheap to produce there. Anything high tech is just as expensive to produce there as it is in the West (or the US at least, maybe not Europe). The reason is the cost in things like chip fabrication plants is in the equipment and construction, not in the labour or operation. A trained engineer in Shanghai costs pretty much the same as one in the US.

Generally China secures these sorts of businesses through protectionism (IMO) and has done for a long time. Hence Bidens 2022 Chips Act (more protectionism).

The real issue with dictatorship is lack of accountability which means you just have no recourse as an individual because there is no rule of law protecting you. I am opposed to anarchy (like the chaos in Russia that followed the fall of the USSR) for the same reason. They're both bad for ordinary people. You need balance of power between the branches because you must have mechanisms for accountability in order to have any hope of fairness. Restoring order after chaos - yes - but as long as you make sure to transition to rule of law. Someone mentioned corruption in China. How do you whistleblow there? How do you effect change? There is no recourse if you're a victim of injustice. You can't effect change unless you're part of the party apparatus and even then I have no clue. I know things are not perfect in democracies - but the flaws become major threats under tyranny or anarchy/failed states.

That’s the kind of thing I’m wary of.

Also in other non democratic countries people can’t run in elections, eg against Putin so you get results where apparently the votes are in his favour so the percentage can be high. But with state controlled media and bad outcomes for those who oppose it’s misleading.

Just a bit! https://en.wikipedia.org/wiki/Social_Credit_System

Isn’t there a fair bit of state control on what you can say and do?

At least we can criticise the gov including on here, protest and vote them out if we are not happy with them.

Blimey. I lived there around the same time as you. Didn't people tell you about the 'disappeared' from almost every family, show you their torture scars and that? They were still afraid to mention anything at all about the government or the military; they loosened up very gradually over the years I was there.

Populations often feel like they want hard-line governance and even a dictator when they're living through uncertainty, particularly populations that are not very clued up about how governments work. There's a growing swell of this kind in Britain at the moment. Wanting something doesn't have to mean it's right for you.

My point is that China's government has an 85% approval rating. Pointing out the obvious doesn't equal that I want to live there. That's irrational thinking. The government there has moved beyond hardline communism to 'authoritarian capitalism' and has lifted millions out of poverty.

What works for one country may not work for all.

It’s not an ‘issue’ to prefer democracy.

You can live where you like. If prefer China’s version of governance feel free to live under it.

It's certainly true that Trump may be remembered as the environmental president.

Drill, baby, Drill.🤔

So maybe they are benign long term, but lack of democracy is an issue.

This attitude is an issue in itself. Why assume democracy is the best way of governing all countries? I lived in Brazil just after their military dictatorship ended and many Brazilians felt that it was needed at the time.

Political systems can change and I would argue that Trump's current government, while elected, is not maximilist democratic.

I honestly suspect Trump/Musk want to wear down people in developing countries (with valuable mines), remove USAID, create famine or widespread illness, and once those people are sufficiently fragile, go in and take over.

Also this has the potential to absolutely emiserate a lot of developing countries, people in already poor countries will be thrown in to severe poverty.

And as pointed out above there is nothing they can do, they cannot simply start consuming a lot of higher priced American goods. It's an awful, evil thing to do.

I'm struggling to get my head around the logic at all-

You impose tariffs because you want to encourage manufacturing in your own country. This removes or at least reduces the price difference between super cheap imported goods and home produced items.

Scenario One, at least partly true:

However, a good chunk of your population is already struggling financially with the availability of cheap goods. You have now priced them out of the market entirely.

Scenario Two, also partially true:

Consumers switch to buying the domestically produced items, and demand increases. Production increases, increasing jobs, and potentially increasing wages for the workers so they can now afford the goods, this drives up the cost of production further, prices go up wages need to go up again etc etc in a never ending spiral of inflation.

What happens to low paid workers in the services industry-cleaners etc. Will their wagss go up too?

However unpalatable it may be, western countries particularly will always be in need of cheap products. And that largely means importing from countries whose workforce are not treated ethically. This is because every country will always need people to work in low paid jobs, such as cleaning, waste management etc because these are essential services.

Unless you are rich enough to be able to consciouslessly switch to the higher priced goods anyway-these tariffs are going to hit the average American hard. And although I know little of their welfare system, my understanding is that it is not as robust as the UK for example (correct me if I am wrong here).

A lot of people who voted for Trump under the MAGA march and not rich are about to get a wake up call about just who is going to benefit under his presidency.

Pre-Trump, the average global tariff rate was 2.5%. The US and the EU were among those with average rates in the 2% range. The countries with the highest tariffs (in the high teens or around 20%) tend to be very small and/or very poor.

They are generally used sparingly, to protect vulnerable but industries that are of high importance to their nations economy.

Trump's tariffs are enormous, and apply to (almost) all goods. The baseline rate of 10% is, itself, 4 times the global average, and many countries have been hit with far higher ones.

He had said they were going to be reciprocal ("we'll tariff you what you tariff us") but they are not, they go magnitudes higher, because his (stupid) math factors in the country's trade deficit.

Trump, it seems, feels like a country is "ripping off" the US if the US buys more from them than they do from it. For example, he has hit Lesotho (a small African country, with a population of less than Wales') with the highest rate of tariffs. The US buys tens of millions of dollars of diamonds from Lesotho each year, as well as a lot of clothing.

Trump thinks that, somehow, the ~2.5m people of Lesotho, more than half of whom live below the poverty line, should be spending the same on US goods as the ~350m people in the US spend on goods from Lesotho. If the average person from Lesotho was 100 times richer than the average American, that would be a slightly more reasonable (if still absurd) ask.

The US accounts for around half of Lesotho's exports, so their economy will be decimated.

Which, apparently, is intended to make them spend more on US products?

It's hard to tell if it's more stupid or evil.

And, of course, China has, and other countries will, retaliate.

Either way, the US is picking a trade war it can't possibly win. I think the biggest question is if Trump really believes (contrary to all sense) that it'd be good for the US in the long term, or whether he's deliberately crushing the economy, people and businesses in order to consolidate his power over them.

The tariffs are bad for the whole world but are economic suicide for the US. I just worry that he'll do something else crazy, like invade Greenland, to distract from it.

It’s not dissimilar to ‘immigrants are bad and are ripping off the US’ whereas it’s the immigrants that do the jobs that nobody else wants to do.

The USA has no natural reserves of the minerals needed for tech and cleaner energy. China has them in spades, and has been deliberately restricting supply for years. This gives it a huge advantage in tech & energy development. Unsurprisingly, China's just downgraded America's access to these minerals.

Ukraine has loads of "raw earth" as Trump called it 🙄 Russia probably has large unexploited deposits, because Russia has large deposits of most minerals but limited capacity to develop them. I was surprised Trump shafted Zelenskyy after he'd evidently been told to get his hands on Ukraine's new-generation minerals, but perhaps he's promised to do Putin's mining for him. I've got no bloody idea what his strategy is, or if there even is one 🤷‍♀️

Absolutely. And don't forget it's the American (and other) corporations who have chosen to manufacture or source goods in China and southeast Asia that has lead to these trade imbalances in the first place.
p.s. and of course his calculation of trade deficits was for Goods only, not services, which makes it even more bullshit