Fed study finds US tariffs backfired | Hacker News Reader

Fed study finds US tariffs backfired

marketwatch.com

20 pointsbelltaco9 comments

People with business interests reliant on cheap foreign manufacturing desperate to have tariffs reversed. More news at 11.

A Tax on something backfired?

The most frustrating thing is watching this pattern repeat itself thousands of times.

Sure, tariffs are rough in the immediate if your business model is selling cheap Chinese steel to a dwindling middle class. You might even miss your quarterly numbers and donate to Mitt Romney. However, wage growth for the bottom 25% is at a decade high. https://www.frbatlanta.org/chcs/wage-growth-tracker.aspx Trump won’t be in office forever. Soon enough, you can sell us all out all over again.

Isn’t the wage growth the result of a long period of high employment? Your comment makes it sound like it’s the result of tariffs.

US policy is now driven purely by emotion, not logic or math.

The tax cuts briefly juiced growth, but not to the predicted 4% growth. Now growth is back down to 2%. Tariffs might be a contributor.

> The tax cuts briefly juiced growth, but not to the predicted 4% growth. Now growth is back down to 2%. Tariffs might be a contributor.

Isn't growth supposed to fluctuate ? I'm not well versed in economic theory (and this might not be totally relevant to the article) but from what I hear/read around me, growth (whatever that means) can't be sustained in linear fashion.

What are the counterarguments to that ? (not trying to start a crusade, I'm genuinely asking)

Yeah, but the tariffs only provoked any growth because companies rushed to stock up on supplies before the tariffs went into effect, anticipating that the coming price increase would decrease profitability and potentially destroy specific supply chains.

Tariffs can't produce any net growth, they can just juice short term growth at the expense of long term growth, and they can produce localized growth (ie for US steelmakers) at the expense of the broad domestic sector (ie all US manufacturers that use steel).

In general, tariffs are an own-goal. Trump had to implement new subsidies for US agricultural firms on the order of tens of billions of dollars annually (and has cost more than twice what Obama's big three automaker bailout cost) to prevent the collapse of US ag that lost a ton of export business because of the tariffs. If we could get China to stop stealing US intellectual property, perhaps the tariffs would be worthwhile, but there is a zero percent chance that will happen.

Tariffs are just bad economic policy.

Small picture viewing here. Trump is dismantling the globalist banking system by breaking their supply chain trade.

Some agricultural subsidies were automatic and in place prior to recent tariffs. Tariffs are bad economic policy if you’re trying to maximize global output, few rational actors try to do that.

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