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U mean asking manufacturers to pay MORE to produce in America encourages them to move production to other countries? You’re kidding!
It's worse than that.
Let's say I want to open a widget factory in America because of the tariffs. Sure, I can avoid the tariffs on the widgets themselves by making them here, but there's a big problem...
What about the tariffs on the materials needed to make them?
So Trump wants to strong-arm a minerals deal with some country via a protection racket only to... tariff them?
Jesus Christ.
Unironically, depending on how the supply chain is arranged for your industry, it may actually be cheaper to move your manufacturing off shore and eat the tariff once instead of getting nickeled and dimed for every single item you need to assemble on shore. Hell, Vietnam already figured out you can ship Chinese products through to America as grey imports and skim off the top.
It is hard for me to articulate just how fucking stupid all of this is. It's no small wonder how this guy bankrupted six casinos.
But hey, Art of the Deal, baby.
I always assumed they were bankrupted on purpose as part of some sort of money laundering scheme, but you're bringing me around to the idea that it may actually have been sheer stupidity rather than crime.
collapsed inline media
This is exactly what some of the biggest manufacturers of cars in America are thinking of doing. They manufacture in America but a lot of the parts are imported and would cost them a fortune to import. It's cheaper to move factories to China, build the full part, and then ship it over because the tarrifs are higher on the individual tech parts inside the assembly than a finished product using those parts.
And that's not even accounting for forecasting, which is still necessary in the stupid-frahile JIT approach. Noone will want to sign a long-term supply contract when they could get screwed by sudden tarrifs and the JIT people have to rely on luck to avoid subjecting customers to sticker-price whiplash.
It's all just so fucking stupid.
I don't disagree with your point, but except for electronics, and Italian marble America can make a lot of the materials themselves. The biggest problem is in many cases the price of labour in the US. And for complex things like cars you can't even move the entire supply chain even if you wanted to.
There was this guy who had a theory that there was nobody on earth who could make a microwave oven, turns out he was right: there are people who can know how to make a certain part of it and other people who knew about it's assembly nobody can create one start to finish. So imagine with more complex machines how difficult it'd be to bring all those skills and knowledge 'home' to America.
*gray, as in ray.
Both are correct, country dependant.
Unless you also correct colour and shit as well in which case go nuts.