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Literally companies could start on-shoring, how foreign car makers all have plants in America now, but you know doom and gloom for outrage bait.
I mean let's think this through. Say it costs many millions, billions even, to create new manufacturing plants for any of the major players. It will take probably years to complete and on top of that US workers have much stronger protections than most of the world with significantly higher labor costs to boot. consumers would immediately pay more because of the tariffs, and then even if the "protectionism" works, we're still paying more, even if it's to US workers and companies. This isn't even to mention that the taxpayer is likely going to foot the bill for construction of new factories as they've done with Intel etc.
i'm struggling to see any merits to this idea. Can you elaborate?
The other big risk is that in 4 years, the tariffs could be removed with a change of government, or earlier when the GOP realises how bad their mistake is.
So these businesses have to decide do they want to invest billions in plants that could be redundant before they're even completed.
I think making products in America is a wonderful idea. As you said, won’t stop the tariff price increases, but there’s merit in investing in manufacturing in countries more capable of increased automation like the United States, Japan, and Western Europe thanks to skilled engineering workforces. This is especially true because if you intend to do manufacturing ethically you’re better off competing somewhere where the minimums in worker treatment and environmental protection are higher.
Now if you need manual labor as cheap as possible, go to South Asia and South America, we can’t compete with them on that unless we’re imposing ludicrous tariffs.
Why are tariffs the tool? Why now? Why disrupt anything for the benefit of corporations and their... thousand(s?) of workers? Unemployment is quite low already, and as far as I know manufacturing has been largely leaving the US for what I assume are economic reasons that will persist longer than the tariffs.
Why not laws requiring ethical sourcing of materials and labor if ethics is your concern?
Full agree. I think I just had shit reading comprehension this morning. Tariffs are a terrible way to achieve this goal. Laudable goal, but demanding better conditions or subsidizing American manufacturing are far better means to achieve it.
Auto parts generally aren’t made in the US, only assembled here.
Toyota is kind of a counter example here. I'm grateful to them for opening several factories in my home state.
It's funny to me that you can buy a (partially) American made and assembled Toyota. Or be a real patriot and buy a Chinese made and Mexican assembled F-150.
You'll be surprised how expensive everything is to build if you pay domestic wages instead of buying things dirt cheap from other countries where wages are low due to slave-like working conditions. This is probably what Trump wants to establish in the US, but when other factors like housing, food etc are already way more expensive than they are in those countries, this creates a poverty hellscape for y'all. The result will be that people can't even afford to live at the standard of a chinese factory worker. Enjoy.
No, it's not wages that would increase prices huge amounts. They'd increase the price of goods slightly (depending on the good) but for the most part the biggest cost factor that increases when you decide to make something in the US is regulations.
Ya know, rules that prevent companies from dumping their toxic waste wherever TF they want. It's not just the regulations that apply to a specific company's business but all the regulations in their supply chain.
Consider a PCB manufacturer: They need epoxies, fiberglass, copper, gold, tin, and silver to make PCBs along with a shitton of associated chemicals. All of those things ultimately come from heavily regulated industries (because we don't want smelter waste full of things like lead, mercury, cobalt, and worse things winding up in our food and water). All that regulation costs money to deal with. Not just in actually complying with the regulations but also hiring people knowledgeable enough to make sure they're complying (and doing so in the least expensive way possible).
In countries like China regulations are basically non-existent because even if they have them officials can easily and cheaply be bribed to get around them (e.g. poisoned baby formula). Furthermore, the people are vastly more ignorant of health and pollution than your average idiot in the US. If some dude sees a company dumping tires on the side of the road they're likely to call the cops because that's obviously illegal. I'm China that doesn't happen because the people will be unlikely to understand the (environmental/downstream) consequences of that or will suspect the cops (and local officials) are in on it and reporting the illegal dumping could get them disappeared.
The most toxic industries are all overseas and we really do rely on them to keep supply chains going. Bringing them back onshore would drastically increase the cost of a shitton of goods just because there's no cheap way to dispose of byproducts here and there's way more requirements around handling such things.
So Trump guts all the regulations.
Problem solved /s
I would love to see a source or some data backing this up.
You're right that regard. I was simplyfing the matter by only using wages as the primary factor. Of course it is a combination of factors which drive production costs, many of which you just explained. However, the end result is the same: Building products on shore is expensive. Someone has to pay the price.
Life is not Factorio, brah. You can't just plop a factory down and start production. It will take a decade and cost billions. At which point a new administration will be here and will repeal the tariffs.
Honda: Hold my sake
I get it for semiconductors, though. Unless there's some loophole for the parts inside of devices, we're kinda boned.
Repealing tarrifs doesnt work like that. The countries we tarrif will do the same right back, and wont be eager to repeal them.
Goods will be more expensive forever
On shoring takes a long time and American labor is more expensive than Chinese and Mexican labor. I work in manufacturing and it takes years to build capacity when you already have a facility. Oh and think multimillion dollar investments with high risk.
I’m not saying they can’t onshore. I’m saying it’ll be slow and expensive and possibly more expensive than not, and because it’s slow the customers will eat the cost long enough that they won’t lower prices when they finish.
I want to believe this is true. I hope that things go that way - if America leads a shift in the way the world gets it's goods that could be a good thing. But I'm not sure that's what will happen, honestly.