So the price may go up, but it will eventually tend toward the natural floor, even if higher than before, taking into account the externalities that were ignored with foreign widgets such as poor working conditions and environmental disregard that happens in certain other countries.
No, the prices will go up. As you said, the cost goes up due to better working conditions, wages, etc...
> The American consumers do have other options — other American companies
Yes, but all of American companies will never go below whatever the Chinese widget costs unless tariffs go away.
Why not? If there are 3 American companies with similar costs, would all of them just say “well, the price is the price?” Or would there eventually be one who realizes they can take more market share from the Chinese companies by undercutting them?
It was probably incorrect to say never, and there is another reply to me mentioning price elasticity which applies here for sure.
> eventually be one who realizes they can take more market share from the Chinese
Yes, on a longer timeline that is possible but in the short to medium term, it doesn't seem realistic for domestic producers to undercut and make profit. Initially you're building factories, refining processes, training workers, etc. which requires capital and investment.
Though, I can’t speak for them, and my opinions on reducing the outsourcing to countries who largely disregard the environment and human rights, are my opinions regardless of their motivations