So, to encourage manufacturers in the US to build more stuff in the US, they will increase tariffs on components so that it will cost even more to build something in the US than to build it in China.
Good plan, hello Canada!
Good plan, hello Canada!
Assuming I am parsing all of this correctly it will end up being better for me to have the PCBs assembled into the products in China and not create jobs in the USA.
https://www.ftc.gov/tips-advice/business-center/guidance/com...
* PCB (Milled, Drilled, Components Soldered) - USA Origin
* Connectors - USA Origin
* Firmware - USA Origin
* PCB Components (Items affected by the tariffs) - China or Otherwise
As far as I know that would qualify as "Made in the USA" or at the minimum "Assembled in the USA". Over 75% of the components have USA origins and the final transformative step is done in the USA.
Please note that I am not trying to be deceptive in my future product's labeling.(6+ months until launch.) However, with political changes like these tariffs they are something that can basically change my stance on how I decide to source in the USA.
In Canada the definitions are simple and clear:
A "Product of Canada" must have its final transformation done in Canada, and at least 98% of the costs are incurred in Canada
Something "Made in Canada" is as above, except the value is 51% and includes a statement about whether imported parts were used.
Wait, a second... Do you really know this? Have your supplier prices already increased? By how much on average of each imported component? What's the total increase per unit shipped?
> A US official speaking on background as a “senior administration official” told reporters on a short-notice phone call today that China is using state-funded companies to outbid US companies, and is intruding and stealing IP from companies.
> USTR last year launched a “Section 301” investigation into China’s practices on technology transfer and intellectual property and concluded that it has long been engaging in unfair practices. The Section 301 report found China guilty of pressuring US companies to partner with Chinese companies, licence under less favourable terms than Chinese companies, using state-funding to buy US companies in order to get ahold of their IP, and engaging in intrusion and theft to get commercial advantage.
> The United States has raised these concerns for years, and gave China the chance to take steps to resolve the concerns, the official said, but “that’s not what they did.”
http://www.ip-watch.org/2018/06/15/breaking-news-us-imposes-...
Point being, people jump to conclusions without seeing the impact on the total cost of goods. Meanwhile dismissing the point, putting more capital into the pockets of US based companies which improves the economy.
The effect on the final product may be minimal but the intermediate manufacturer of, e.g., the rails that hold the car seats in place may end up having to lay off half their workforce. If the product that makes up 80% of your business has a 15% margin and now your main raw material input rises in price by 25%, you could be in serious trouble.
Tariffs are a political tool. There is some objective here that is not being publicly outlined because it would defeat the purpose of the strategy.
Example: Other countries involved in this "trade war" are placing tariffs specifically on bourbon. Why? What do they have to gain by that sort of rule? Absolutely nothing, other than putting political pressure on the representatives and senators from Kentucky. (Source: NPR, radio earlier this month where a representative of Canada said exactly this. I wish I could find the audio.) This is the very definition of other sovereign countries interfering with American politics. I would bet that the tariffs being placed here locally are designed to have similar effects.
You don't have to buy anything. Just listen to the man himself and it's crystal clear.
This is literally baseless nonsense.
America has a single goal that is beyond transparent: prevent the rise of Chinese apex-technological manufacturers. Everything was okay when China was making shoes and Christmas lights but now they're fabricating increasingly sophisticated computer chips [0], producing more electronic cars than the rest of the world combined [1], and kicking out all sorts of fancy 5G telecom equipment that does more but costs significantly less than what Western manufactuers can offer [2].
The "strategy" here is too little and far too late. Trump's only victory here will be, like so many other victories, purely symbolic: his base might get riled up and support him for taking on the "Chinese" who "stole" all their jobs... but China's competitiveness here won't be affected. Cutting off Americans from China's competitive electronics will just drive up prices in America and make American companies less competitive on the global market. The rest of the world (the other 7.3 billion on the planet) absolutely love China's cheap but capable electronic products. The only thing at this point that will actually stop China's growth here is literal bombs and tanks.
[0] http://mckinseychina.com/whats-next-for-chip-makers-in-china...
[1] https://nextshark.com/china-now-makes-electric-cars-every-co...
[2] https://telecom.economictimes.indiatimes.com/news/mobile-net...
Yes, I understand that perhaps OP's comment might have been influenced by the policy maker, but nothing in their post makes any mention of anything beyond a simple policy critique, so this line of argumentation is, at best, putting words in their mouth.
If a policy is, to one's opinion, good or bad, then it should not matter whether or not the policy was proposed by someone we like or someone we hate, and to that end, it shouldn't matter one whit how popularly supported it is by our legislators, even where that popularity is enjoyed across partisan lines.
Arguing against a policy critique with a critique (or commendation) of the policy-makers is totally non-sequitur.
Well, I have listened to him speak, so yes.