One last time

[jpl458]

DJT is proposing as much as 60% tarrifs on imported goods. Here is his Truth Socal message on the subject:

@realDonaldTrump

"I am NOT proposing a National Sales Tax, as the Democrats say in their Advertisements against me. Dems know what they are saying is a blatant lie. I am proposing tariffs on other countries that take advantage of us, hardly an NST. These tariffs are paid for by the abusing country, NOT THE AMERICAN CONSUMER. They do not cause inflation and will MAKE AMERICA RICH AGAIN!"

First, the abusing coutry does not pay the tarrif. Here is how they really work:

Lets say a national chain that sells TVs , one of which sells for $1,000 dollars before the tarrif, and is made in China. When the Chain store picks up the TV at the dock, after the tarrif is imposed, they must pay the tarrif to the US Treasury, which in this case would be $600 dollars. Now, that TV sits in the store with a new price of $1,600 dollars. Thus, the rarrif is paid for by the consumer, which is infationary, and which could be called a National Sales Tax, because the consumer pays the tarrif, just not directly to the Treasury, but its paid when they buy the new TV.

There is no way the the US can force China to pay for the tarrif. Besides, lets say China makes the TV with a 50% margin, so if they pay the tarrif they will loose 10% on each TV exported to the US. That is called "I Love Lucy economics."

Tarrifs have never worked the Way Trump describes.

There are only 3 conclusions that can be reached from Trumps post. 1, he is lying 2, he is ignorant 3, he is stupid. Take your pick.

 

[Pat Hartman]

Thus, the rarrif is paid for by the consumer, which is infationary

No, because since the TV will never sell for $1600, it will not be purchased. The importer would be pretty stupid to purchase something he could never sell for a profit. The tax is on the wholesale cost, not the retail. So, the $1000 TV wholesales for 500. That makes the tariff 300. If the retailer is happy with his reduced profit, he buys the item. If not, he offers to pay 400 to the manufacturer to split the difference. That makes the tariff 240 and now his cost is $640 and he still makes a good profit on the TV. And the consumer still pays $1000 for THAT TV or buys a different TV.

 

[Pat Hartman]

No one ever HAS to buy a TV. Tariffs are not placed on items that are necessities of life. The buyer can always walk away. That is free trade. Allowing me to choose between 10 overpriced providers for my electric company to deliver is NOT free trade because I CANNOT walk away if the price is too high. To live in the 21st century I must somehow find the money to purchase electricity. I don't need a TV. I especially don't need a thousand dollar TV.

 

[jpl458]

No, because since the TV will never sell for $1600, it will not be purchased. The importer would be pretty stupid to purchase something he could never sell for a profit. The tax is on the wholesale cost, not the retail. So, the $1000 TV wholesales for 500. That makes the tariff 300. If the retailer is happy with his reduced profit, he buys the item. If not, he offers to pay 400 to the manufacturer to split the difference. That makes the tariff 240 and now his cost is $640 and he still makes a good profit on the TV. And the consumer still pays $1000 for THAT TV or buys a different TV.

The point I am trying to make is that the abusing country does not pay the tarrif as Trump claims. We can't tax China, or force them to pay the tarrif. That part is pure BS.

 

[Pat Hartman]

The point I am trying to make is that the abusing country does not pay the tarrif as Trump claims.

Try reading my example again. You missed the concept of what gets tariffs and what doesn't as well as who pays.

 

[Pat Hartman]

When Trump says "China" he means the manufacturer. This is sloppy of him since obviously the government of China isn't going to pay for the tariff unless they are the manufacturer. In many cases they are so the statement isn't as off as it might be. If he said "France" was paying the tariffs on wine, you would have more of a case though. You keep harping on the details while refusing to understand the concept. Go on, be pedantic about the details and blind yourself to why and how tariffs are used to benefit the American public.

 

[jpl458]

Try reading my example again. You missed the concept of what gets tariffs and what doesn't as well as who pays.

Pat, my example was simple. But the fact remains the the abusing country does not pay the tarrif whatever the amount, the consumer pays the tarrif, which in effect is a National Sales Tax, except that the consumer pays the importer who has already paid the tarrif.

 

[jpl458]

Are you saying that Trump is correct in saying the abusing country/manufacturer pays the tarrif? That is completely untrue. Read his text. Smoke and mirrors will not change the fact that the consumer pays for the tarrif.

 

[Jon]

Lets say a national chain that sells TVs , one of which sells for $1,000 dollars before the tarrif, and is made in China. When the Chain store picks up the TV at the dock, after the tarrif is imposed, they must pay the tarrif to the US Treasury, which in this case would be $600 dollars. Now, that TV sits in the store with a new price of $1,600 dollars. Thus, the rarrif is paid for by the consumer, which is infationary, and which could be called a National Sales Tax, because the consumer pays the tarrif, just not directly to the Treasury, but its paid when they buy the new TV.

There is no way the the US can force China to pay for the tarrif.

Before tariffs:

Taiwan TV: $500
China TV: $500

After tariffs:
Taiwan TV: $500
China TV: $800

So, no one buys China TV's because they no longer represent good value for money. To export to the US, they have to reduce their price so that the cost + tariff is competitive. Therefore, they have to cut their profit margins. This hits China, its economy and its companies, not the US consumer. No one is forcing the US consumer to buy overpriced Chinese goods, as you seem to think they are.

The net effect is that the Chinese product is the same cost to the consumer, but the US government gets a lot of money from tariffs. In essence, China pays through having to cut its profit margins.

 

[Pat Hartman]

I may understand Trump when he speaks but please don't put words in my mouth. I SAID, the importer does not import items he cannot sell for a profit. Whether the wholesaler, or the retailer pay all or part of the tariff, the consumer never has to pay it because he never has to buy the overly expensive item. I've never paid a thousand dollars for a TV or a phone and I never will. TVs are not necessities and neither are thousand dollar phones. Serviceable phones can be purchased for $100 so spending 10 times the price for a "name" is simply silly. Of course telling my teenage daughter that buying the jeans with the brand name plastered all over them was idiotic didn't matter because peer pressure is overwhelming before you have matured. What does that say about all the adults that buy (on time) new iPhones every other year? They have no more sense than a 13 year old girl?

 

[jpl458]

Before tariffs:

Taiwan TV: $500
China TV: $500

After tariffs:
Taiwan TV: $500
China TV: $800

So, no one buys China TV's because they no longer represent good value for money. To export to the US, they have to reduce their price so that the cost + tariff is competitive. Therefore, they have to cut their profit margins. This hits China, its economy and its companies, not the US consumer. No one is forcing the US consumer to buy overpriced Chinese goods, as you seem to think they are.

Look around your house and see how many items are made in China. In the US, there are a lot of items. I just wanted to make it as clear and as nsimple as I can: then tell me who pays the tarrif? Trump has stated the he wants to raise tarrifs on everything that comes into the US. It begs the question, who pays the tarrif, the abusing countries, as Trump errantly stated in his post, the importer, or the American consumer. Or, do we not buy anything until the product is made in America, which could take years, if not decades, where labor costs are much higher than in China, which would would also raise the prices. Here is what was found from the imposed tarrifs over the last 8 or so years.

Economists Pablo Fajgelbaum, Pinelopi Goldberg, Patrick Kennedy, and Amit Khandelwal examined the tariffs on washing machines, solar panels, aluminum, steel, and goods from the European Union and China imposed in 2018 and 2019. They found that U.S. firms and final consumers bore the entire burden of tariffs and estimated a net loss to the U.S. economy of $16 billion annually, including more than $114 billion in losses to firms and consumers, offset by small gains to protected producers and revenue gains to the government.

Using a slightly different methodology, economists Mary Amiti, Stephen J. Redding, and David E. Weinstein also found nearly complete pass-through for the tariffs, noting that “US tariffs continue to be almost entirely borne by US firms and consumers.” Some differences emerged across product types. For instance, for steel, the authors found that an initial pass-through of 100 percent fell to 50 percent a year after the tariff was applied. Foreign exporters, mostly in the European Union, South Korea, and Japan, lowered their steel prices somewhat, but U.S. firms and consumers still paid higher prices than they would have without the tariffs.

 

[AccessBlaster]

Look around your house and see how many items are made in China. In the US, there are a lot of items

some of us would like to change that...

 

[Pat Hartman]

Weinstein also found nearly complete pass-through for the tariffs, noting that “US tariffs continue to be almost entirely borne by US firms and consumers.”

That is because Congress and many Presidents don't understand tariffs. You solve the problems caused when other countries apply tariffs to our manufactured goods by using reciprocal tariffs. Eventually, trade equalizes and the tariffs disappear. Please note that NO company will reduce its price just because a tariff was eliminated

 

[jpl458]

some of us would like to change that...

How would that change take place? How long would it take to have everything that we import to be made in the US. How do you force Apple to make those nifty Iphones in the US where labor costs are much higher. China is the clear leadr in manufacturing those type of items. No matter how you cut it American importers and consumers pay the tarrifs. It remains a simple concept.

 

[AccessBlaster]

How would that change take place? How long would it take to have everything that we import to be made in the US. How do you force Apple to make those nifty Iphones in the US where labor costs are much higher. China is the clear leadr in manufacturing those type of items. No matter how you cut it American importers and consumers pay the tarrifs. It remains a simple concept.

We are the market China wants to dominate, instead of buying cheap Chinese crap buy Japanese, German or American when available. We have the ability to move the market if we so desire.

 

[Jon]

Look around your house and see how many items are made in China. In the US, there are a lot of items. I just wanted to make it as clear and as nsimple as I can: then tell me who pays the tarrif? Trump has stated the he wants to raise tarrifs on everything that comes into the US. It begs the question, who pays the tarrif, the abusing countries, as Trump errantly stated in his post, the importer, or the American consumer. Or, do we not buy anything until the product is made in America, which could take years, if not decades, where labor costs are much higher than in China, which would would also raise the prices. Here is what was found from the imposed tarrifs over the last 8 or so years.

It appears what I said has just flown right over your head. You are assuming there is price inelasticity, or namely, if price goes up, demand remains the same. But the whole point is that if price goes up, consumers switch. If Apple phones were twice the price of the Samsung, you seem to suggest people will still buy the Apple phone in the same quantities at $2,000 as they would at $1,000. But they don't. They switch.

You don't have to buy from an American company. There are 194 other countries out there.

Edit: You know all this already, but dislike Trump so much that you have fixated on his phraseology that melts your brain.

 

[jpl458]

We are the market China wants to dominate, instead of buying cheap Chinese crap buy Japanese, German or American when available. We have the ability to move the market if we so desire.

Tump said the abusing country pays the tarrif, that is completely wrong. That is the only point I want to make.

 

[Pat Hartman]

How do you force Apple to make those nifty Iphones in the US where labor costs are much higher.

Make the cost of using slave labor for your ego too high to sustain.

 

[Pat Hartman]

Tump said the abusing country pays the tarrif, that is completely wrong. That is the only point I want to make.

And several of us have explained how he meant that. But you persist in arguing your meaningless point rather than understanding the concept.

 

[jpl458]

It appears what I said has just flown right over your head. You are assuming there is price inelasticity, or namely, if price goes up, demand remains the same. But the whole point is that if price goes up, consumers switch. If Apple phones were twice the price of the Samsung, you seem to suggest people will still buy the Apple phone in the same quantities at $2,000 as they would at $1,000. But they don't. They switch.

You don't have to buy from an American company. There are 194 other countries out there.

Edit: You know all this already, but dislike Trump so much that you have fixated on his phraseology that melts your brain.

No, that is not what I am saying. Trump states in his TruthSocial post the the abusing country pays the tarrif. And that is not true. Very simple. BTW, I thought that Biden extending Trumps tarrifs was dumb. Another BTW, does England export any goods to the US. Here is his post again.

"I am NOT proposing a National Sales Tax, as the Democrats say in their Advertisements against me. Dems know what they are saying is a blatant lie. I am proposing tariffs on other countries that take advantage of us, hardly an NST. These tariffs are paid for by the abusing country, NOT THE AMERICAN CONSUMER. They do not cause inflation and will MAKE AMERICA RICH AGAIN!"

The sentence in italics is not the way tarrifs work. No matter how you calculate it, someone is going to pay the tarrif. But not the abusing country. On that issue alone DJT is delusional.

It appears what I said has just flown right over your head. You are assuming there is price inelasticity, or namely, if price goes up, demand remains the same. But the whole point is that if price goes up, consumers switch. If Apple phones were twice the price of the Samsung, you seem to suggest people will still buy the Apple phone in the same quantities at $2,000 as they would at $1,000. But they don't. They switch.

You don't have to buy from an American company. There are 194 other countries out there.

Edit: You know all this already, but dislike Trump so much that you have fixated on his phraseology that melts your brain.

Trump openly states in his post that the abusing country pays the tarrif, which is absolutely not true. Which leads me to believe he does not understand how tarrifs work. I am only concerned about that statement alone. I have concerns with other statements he has made, "They are eating dog and cats" which is also not true, but that is for another time.