I’m not sure if I’m going to answer the question you’re asking, but all the madness aside, I get interested in the mechanics of how this stuff actually works (I think you may know this so it’s for anyone else interested):
Foreign goods, like an avocado, that are subject to tariffs come through ports of entry: an airport, a water port, rail, etc. The customs border patrol, enforcing the tariff on that particular country, checks out the goods and does it thing. Let’s say the tariff is $0.11/kg for that country’s avocadoes. CBP collects the money owed right then - before the goods can clear customs and be released into the US for sale. That tariff money gets deposited into a US Treasury account. That’s it (and surely oversimplified).
Last year, the US collected approximately $80 billion in revenue from tariffs on imported goods, accounting for about 2% of the total federal tax revenue of $4.44 trillion. You can find all the goods and tariffs here: Harmonized Tariff Schedule. In the old days (yesterday), all the goods are listed, and it would just say “free” or not subject to a tariff (because NAFTA) but everything is still tracked so we can account for what is coming into the country.
I’m also thinking about a saying of mine: the US used to make sacrifices when the country was at war. Now, we go to war so the country doesn’t have to make sacrifices.
At least until this year.
Remember how they mocked and derided:
Carter for putting solar panels on the White House and suggested that Americans put on a sweater and lower the thermostat setpoint in winter;
Obama for suggesting checking your tire pressures and getting a tune-up?
So … now … prosperity will be measured in terms of how much of a hit we can deliver to the 70-ish% of US GDP that consumption comprises?
I feel like they omitted that bit in the campaign, making this possibly The Biggest Bait and Switch in the politics of, at least, my lifetime.
Nice … I say … nice pivot, there, GOP!
ETA: and I’m aware that – kind of to @Dr_Paprika 's point – the inflationary impact of these tariffs – just like any consumption tax – will be overwhelmingly regressive.
I’ve long said that Republicans do believe in redistribution of wealth. They just like to push it upward.
So far as I’ve ever seen, Trump isn’t a Republican. My sense is that he sympathized most with the Dixiecrat side of things before Reagan, but didn’t make the shifts in belief that Reagan did to support things like the Free Market and Free Movement. Consequently, he languished around without a party as an Old South style lefty, unwilling to change, and abandoned by the rest of the lefties who either went woke or pro-free markets. But, you hear him ever reference any political heroes and it’s Jackson, FDR, etc. He’s pardoned a swathe of Democratic politicians, golfed regularly with Bill Clinton, etc. His mortal enemies are GW Bush and Reagan. He fights for worker protection and supports unions (that support him).
I doubt that Trump wants to become poorer himself but I wouldn’t trust that, in the name of power and securing a 3rd term, he wouldn’t be happy to dump most of the other billionaires into poverty or print out checks for each household sufficient to raise everyone into millionaire-hood - blind to the GINI - just to get all the votes and secure a place in the history books as the President who changed everything (bad or good as it may be).
To the extent that he is something of a stateless actor, or an opportunist who saw the Presidency under the GOP rubric, he’s still surrounded by Republicans (of a sort), and – IMHO – they created a positive feedback loop around tariffs, knowing that it would tend to push wealth upward.
IOW, whatever party comes closest to aligning with … whatever actual principles Trump theoretically has, it’s Republicans all the way down in his administration, and the machinery crafting and propagating policy for him.
My thought was “Yes, our fathers and grandfathers busted their asses working in factories, but they did this so their children and grandchildren wouldn’t have to”.
I was speaking metaphorically, my dad worked in advertising.
But, seriously, who wants to go back….
And there’s another point I haven’t seen mentioned. I’m not an economist so I’d appreciate feedback if I’m off base,
For some of the goods beings discussed, like Nike sneakers and Chanel purses and iPhones, the bulk of their value isn’t derived from the cost of material and the labor used to assemble them.
The value is a product of American innovation, American design, and American sales and marketing campaigns. Without these things, the value would only be a small percentage of even the wholesale cost of these products.
I know the Trump calculations of trade deficits ignored things like the value of services and intellectual property, probably because it would destroy their grand thesis that there’s a worldwide conspiracy to stick it to American businesses, but I’m not sure if anyone has taken into account how those services raise the price of manufactured goods.
Trying to determine what % of their COGs is actually affected by tariffs, and which tariffs would hit them (based on where they’re sourcing materials and product) … I have nowhere near enough visibility into their cost structures or supply chains to hazard a guess.
But these are not great big operating margins that can effortlessly absorb a sudden financial wallop.
What I’m not sure of, though, is how applicable it would be – even to Trump’s “thought process.”
A tariff is going to be levied on the value of the imported goods (including freight and insurance to land it in the US). Whether that’s raw materials to be assembled in the US or finished products to be sold in the US … it still represents some fraction of the Cost of Goods Sold.
The rest of what you listed is recaptured – to one degree or another – by amortizing it across each unit sold – generally, in order to reach certain target profitability metrics (tempered by price elasticity).
IOW, Trump doesn’t care what you do in the office/at headquarters. Wherever you source your products or materials … if it ain’t in the Good Ol’ U.S. of A. … he’s going to inflict economic pain on you.
You’ll still have to find a way to amortize those other fixed/semi-variable costs across each unit sold, and … OhByTheWay … good luck with that, because if you raise your prices, Hegseth has orders to launch a drone strike on your facilities.
I heard about it on a Signal chat, so you know it’s true
I think Trump has taken the worst elements of the Republican party and remade the Party in his and their image. And that the few remaining “traditional” Republicans have been exiled, sidelined, or lost any credibility in their inability to consistently speak out against said efforts or to shift the blame for such to Democrats.
If Sage_Rat wants to claim they aren’t, say Reagan/Bush era Republicans, well, fine, but Reagan was the one who brought the Religious Right to power, which is a huge part of the Culture Wars the Right has been fighting ever since.
But if you draw a line through Hamilton, Lincoln, Teddy, Ike, Reagan, and the Bushes, it’s not hard to find patterns. And likewise, if you draw a line through Jefferson, Jackson, FDR, and George Wallace, you get some commonality.
Trump has swapped from one line to the other and the people on this board and at the top of the Democratic party haven’t yet noticed that Trump’s base is their base, and the old Republican base is sitting free and a hell of a lot closer to them than they are to Trump.
Chuck Schumer, saying that he just needs to focus more on answering to the common man and factory worker is wildly out of touch with the new politics of the world.
At the moment, there’s two Democratic parties. It’s the hippies vs the KKK all over again, and the rest of us have been sidelined from politics. Personally, I’d suggest that the hippies give up the bongs and start paying attention cause Reaganites and Bushites are waaaay better than KKK and 2 v 1 is a lot more secure than 1 v 1 v 1.
In lighter news, someone set up a bluesky account for the Heard island government.
Their pt. latest post:
“Humanity’s best quality is the willingness to fight other humans on behalf of flightless birds and seals. Herd mentality may have gotten you into some messes, but our combined Heard mentality will be etched in the history books and rookeries.”
Further down a graph illustrates that the latest tariffs has not influenced their trade balance.
