With all the talk of tariffs, I’ve seen more or less this argument:

“Once the tariffs go in place, companies will start manufacturing in the USA and that’s good thing.”

However, when I think about being able to manufacture something like a laptop computer, or a car, these are both operations that require a lot of things:

  1. the input components to build the thing
  2. skilled labor that can manufacture the thing
  3. supply-chains that are in place from initial build all the way to retail

The premise seems to be: “OK, tariffs go in, someone INSTANTLY sets up a company that manufactures X, then USA wins”.

However, for someone to want to take the “bet” on setting up a really expensive factory, they’d have to believe that the tariff will be in place a long time, because if it is NOT… then they have made a terrible investment and the new factory will be instantly non-viable.

Am I crazy? Am I missing something? I understand that it would be great if we had domestic manufacturing but it seems like the people that are behind tariffs think you just snap your fingers and there is a factory cranking out laptops, when in my understanding this is a process that requires a huge amount of money and time.

My thinking is that the amount of people / companies in the USA that have enough capital to start up a manufacturing company like this want to make sure it’s a relatively safe bet before pulling the trigger, and if past tariff behavior from Mr. Trump is any indication, we can’t count on these tariffs being present for a long time.

  • @[email protected]
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    43 months ago

    Maybe dumb people who bought the Trump line on tariffs think that, but most people know it’s not true.

    All the talk about bringing back manufacturing is just a smoke screen to cover the fact they’re intentionally tanking the economy so the oligarchs can buy the dip and get even richer when the economy recovers. That’s all it is.

  • @[email protected]
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    43 months ago

    I think the supply-chain issue is often forgotten about. Sure, we can open manufacturing businesses here to make whatever, but where do people think the materials will come from? Do they think we’ve had all the materials we need to manufacture goods here in America all along and we just haven’t been because everything is cheaper to make overseas? Just look at this list of major exports by country. Does the US have SOME of this stuff? Sure, but enough to make enough goods for US consumers on a regular, as-needed basis? No way. We will need raw materials, and there won’t be enough to go around.

  • Echo Dot
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    3 months ago

    The problem is you appear to have an IQ greater than that of 6 and so you’re probably not a MAGA supporter. Trying to apply logic to these idiots is a waste of time.

    • Jerkface (any/all)
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      3 months ago

      Trump’s notional plan is to replace income/gains tax (on the wealthy) with tariffs. I have not heard of any meaningful uses being reserved for other nation’s retaliatory tariffs. Logically and morally they should be going to relieve the burden of the US tariffs, but I have never heard how that might be intended to be accomplished.

      • Echo Dot
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        33 months ago

        The last time Trump did this in his first term his tariffs ended up causing businesses to move out of the United States.

  • @[email protected]
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    3 months ago

    If Nike shoes go from $200 to $300 from tariffs, there is a big opportunity for crossborder shopping in Canada or Mexico, where in Canada they would be $226. And then more opportunity to smuggle them with volume discounts for US ebay listings. A peer to peer smuggling network takes away from “backbone of retail economy”, and then lowers value of US official market such that making $300 shoes inside the US costs a big investment, and still loses to smuggling.

    Apparel industry jobs tend not to be as glamourous as Boeing, Catterpillar, Deere jobs which are pretty much only US manufacturing export sector than defense. Losing export markets from hatred of US, doesn’t get replaced with good jobs in apparel, or exports of expensive US apparel.

    There’s also a good chance that competing global brands take massive market share from US aligned companies, and less scale will mean less marketing budget.

  • HobbitFoot
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    103 months ago

    It is a simple solution to a complicated problem. For a segment of society, it sounds good enough.

  • @[email protected]
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    153 months ago

    Assume that, for the first time in his life, Donald meant what he said. Pretend that he won’t change his mind or panic, and assume that the same GOP which keeps missing Speaker of the House election layups won’t break and let the Democrats take the tariff power away

    The midterm congressional elections are always a swing to the other party. The Democrats are more likely to take at least one chamber of Congress than Trump is to say something dumb. But let’s assume that for some reason they only take one, and you get gridlock enough to preserve the tarrifs until the next POTUS takes office in January 2029.

    A factory would need to break even by that time to be worth a quick investment. And not just break even, but leave you with more wealth than if you just bought a bunch of crypto and stayed home until this all passes. And if you signed an deal today, your break even points might be as soon as only 45 months away.

    You can’t even get a car loan with a team that short.

  • @[email protected]
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    63 months ago

    Shawn Fain is the president of the United Auto Workers union. He successfully negotiated higher wages and better benefits for his member in 2023 after calling for and receiving authorization for a strike. He continues his efforts to unionize more shops and floated the idea that other unions have their contract expire in 2028 when the UAW contract expires.

    He was on Meet the Nation this past week and when asked “Let’s start very simply on the question of tariffs on autos and auto parts. Fundamentally, and quite simply, why do you believe those are helpful for your membership?” This is what he said:

    [A]ll you have to do is look at the history of the United States, especially in auto manufacturing in the last 30 years, with the inception of NAFTA and unfair trade laws. We’ve seen over 90,000 manufacturing facilities leave the United States. We’ve seen- in the Big Three alone, in the last 20 plus years, 65 plants have closed. You know- And so look, tariffs aren’t the total solution. Tariffs are a tool in the toolbox to get these companies to do the right thing, and- and the intent behind it is to bring jobs back here. And, you know, invest in the American workers. The American working class people have been left behind for decades, and they’re sick of it. You know, it’s a massive struggle. People are struggling just to get- to survive right now, to get by. And so, you know- you know- you know, there’s two parts to the tariffs though. I mean, the tariffs are a motivator. We have to fix the broken trade laws. And the other thing to me is, you know, these can’t just be just, you know, as with the Biden administration, when they did the stuff for battery work and EV work, we had to come in and say, no, these can’t just be union jobs or- or jobs. They got to be good paying union jobs that set standards. So the big part of this that gets left out a lot of times is, if they’re going to bring jobs back here, you know, they need to be life sustaining jobs where people can make a good wage, a living wage, have adequate health care and have a retirement security and not have to work seven days a week or multiple jobs, just a scrape to get by, paycheck to paycheck.

    He goes on to agree with “Peter Navarro, a top adviser to the president on trade, says currently, automobile manufacturing plants are at about 60% capacity. He argues that there’s lots of untapped capacity, meaning jobs could be created relatively easy, and you didn’t have to need- you wouldn’t need to spend two or three or maybe five years building new factories.”

    So I’m glad to hear that the UAW and their membership may be well positioned, but the increase in prices will result in inflation and that’s bad for all people including his members. Guess what we don’t buy when we aren’t sure how much groceries or everyday items will be … Cars? Yep. Cars.

    • @[email protected]OP
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      13 months ago

      He goes on to agree with “Peter Navarro, a top adviser to the president on trade, says currently, automobile manufacturing plants are at about 60% capacity. He argues that there’s lots of untapped capacity, meaning jobs could be created relatively easy, and you didn’t have to need- you wouldn’t need to spend two or three or maybe five years building new factories.”

      This is an interesting tidbit. That means they could “turn up” any of these existing facilities without building anything new, yet they have not. Lack of demand? Noncompetitive price? It would be interesting to know. To me, if we have plants sitting at less than full capacity we should solve that before meddling with any new industries that would require greater investments.

    • Echo Dot
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      53 months ago

      Also because these tariffs are so overreaching they also include component parts. So you can’t build your laptop because all of the chips are built outside the US so by being in the US you actually increase your exposure to tariffs. Outside the US you can build your laptop without having to deal with tariffs on every single component, then let Walmart pay tariffs to import.

  • 52fighters
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    33 months ago

    I agree, this is bad logic. That said, that’s not what I hear from the current regime when I hear them talking about tariffs. What I hear is them thinking this will force countries to lower barriers to Americans doing business abroad. Once those barriers are lowered, tariffs are reduced or go away altogether. For the record, I do not think this is good policy, but the intent of the policy (at lease as I read it) isn’t to suddenly move all manufacturing back to the United States.

  • @[email protected]
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    293 months ago

    only the trumpers think so, and no its not, its actually more expensive, you have to build up your own factories, manufacturing plants which cost billions and years to build, and luring TALENt, is going to be very difficult

    • @[email protected]
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      113 months ago

      We have a very difficult time recruiting workers to existing manufacturing plants that have very competitive salaries.

  • @[email protected]
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    73 months ago

    Creating a single permanent job costs about 100k in investment. Any potential profits will only hold as long as the tariffs are in place, and as the tariffs are as volatile as Trump, nobody is going to spend that amount of money on an idiots folly.

    • @[email protected]OP
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      73 months ago

      I see a lot of people saying “someone will build factories” and a lot less people saying “I will pay to build that factory”

  • @[email protected]
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    263 months ago

    Trumpers are actually dumb enough to believe that factories and jobs pop from the ground overnight and without any costs.

  • andyburke
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    63 months ago

    You can solve our issues with investment, like Democrats do. Our economy does better under Democrats than Republicans.

    Republicans seem to think this is how things work and that may explain the consistent economic downturns you see under most Republican admin’s.

    Until the American people figure this out, things will suck.

    Democrats may not be your cup of tea, but it’s undeniable the country does better when Republicans are not in charge over the past century or so.

  • @[email protected]
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    223 months ago

    Not to mention any new factories will have drastically fewer jobs than the factories that left due to newer factories being highly automated. The cost of retrofitting existing factories has stopped many companies from upgrading to keep higher their quarterly profits for investors. If they are forced to build, they will invest in money saving long run cost savings like automation.

    • @[email protected]OP
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      113 months ago

      Yeah, this is a great point. A fully automated car company in the USA is great for those who want to buy cars, but for those who want a job building cars, it does nothing. The observation that these NEW firms would be set up with massive automation makes perfect intuitive sense to me, because who’d invest in a brand new manufacturing firm and use last century technology to do so?