> The present understanding is that the tale's moral supports team effort and recognition of the vital part that all members play in it. In more authoritarian times, however, the fable was taken to affirm direction from the centre.
A current account deficit is a capital account surplus. Persistent deficits shift the balance between Asset vs Export sectors, dumping the export sector and pumping the asset sector. Put differently, we can pay for imports with shit that we make or shit that we own -- and this has implications for people in our country who make shit vs own shit.
A better analogy for the trade deficit would be sitting on the couch slamming potato chips and observing the shift in our body away from muscles and towards fatty tissue. Should we be excited to see this example of specialization in action? Is it wrong to want to fix our diet and push our body composition in the opposite direction?
It’s reasonable to want to bring back american manufacturing. But the random, temper-tantrum, market-manipulation tariffs are not going to do that. America isn’t going to all of a sudden produce tonnes and tonnes of xmas decorations every year just because of a 50% tariff on all chinese goods that may or may not be around in 6 months. All that’s going to happen is xmas decorations are going to be more expensive.
An actual plan would be targeting specific industries where america has the ability to scale up, and having congress pass tariffs that slowly ramp up over time to allow a smooth transition.
They're explicitly pointing out that the US (and most of the western world) has abandoned the manufacturing sector of their economy, outsourcing work that used to employ millions of people to the developing world.
This is a trade-off that can benefit both countries, but, it is wise to consider both WHO benefits from this, and what the LONG-TERM implications of this entails. It's great for an investor class in America that has the capital to create factories in China, and it's great for China to take USD and start to employ their workforce. But, the question is whether or not this is actually a good thing for the American worker.
The rust-belt would certainly have an opinion on this. My father was a factory worker that was able to support a family on a single income, and when that manufacturing plant closed, it absolutely destroyed the finances of my family.
I personally believe that strategic tariffs should be used to protect our national interests, including providing meaningful employment.
This administration has no interest in strategic tariffs. Instead, they are made overbroad (50% on everything from Canada vs, say, cheap imported steel) and they are made and removed capriciously (tariffs on English whisky dropped after King Charles' visit to the White House).
If Trump really wanted to bring your dad's factory job back, he'd specifically target whatever industry he was working in AND ideally spend the tariff money boosting that industry. This is precisely the strategy countries like Japan used to reach first world status.
Instead Trump uses tariffs like a cudgel -- much closer to what the XKCD comic depicts. There is no chance his tariffs will lead to your father's factory ever being reopened, as that would require, at the bare minimum, a tariff that investors know will stay in place for years, as opposed to one that could be lifted with the visit of a charismatic member of nobility.
[...wanted to bring your dad's factory job back, he'd specifically target whatever industry he was working in AND ideally spend the tariff money boosting that industry.]
Which was more or less the intent of the CHIPS and Science Act for the semiconductors industry.
Oh, I agree that the way that the tariffs are currently being levied is embarrassing on a national scale. Also on the fact that meaningful economic change won't happen when these tariffs will disappear/re-appear at the drop of a hat.
It's also worth pointing out that while, yes, there is 50% tariff on Canadian goods, this only effects ~5% of imported goods, meaning 95% of the Canadian imports are unaffected by this nonsense.
It's also worth pointing out that some of these tariffs actually are being used to help build out US industry, like the CHIPS act.
I don't think that we disagree on anything here, haha
Yes, but I'm pretty sure he doesn't know that and thinks flapping between protectionism and TACO is a brilliant strategy for achieving the best of both worlds rather than an idiotic strategy guaranteed to result in the worst of both worlds.
"Destroy American affluence so that we can't pay with assets instead of exports" is probably the worst conceivable way to unwind the exorbitant privilege of the American Economy. We could have spent that money helping people, instead we spent it on wars and tax breaks for billionaires. We could have spent that money on targeted industrial policy (the IRA and CHIPS acts under Biden were examples of this done right, just not at the scale we needed) but instead we are doing it the hard way. Sigh.
The context here is that president Trump has an interesting view of trade deficits / surpluses. Specifically, he frequently cites cases where the US has a trade deficit with another country -- where the US is spending more in that country than that country is in the US -- as if that country is "taking money" from the US.
This is a bit peculiar, because it ignores the whole "the money we are spending is being exchanged for goods that come back to the US" part of the trade. I.e. it's not a problem that I have a "trade deficit" with the grocery store, because I have my groceries.
Actually you, like most of us, have a trade deficit with the grocery store and the movie theater, and a trade surplus with your employer. Which one is more enjoyable to have?
The experience of the trade deficit with the grocery store and the movie theater is more enjoyable, overall. I get films and ice cream and a good time out of it. From my employer I get a lot of sitting in meetings -- they have to pay me to make me put up with that!
My point is that reducing it entirely to "did I gain or receive cash-money from this?" isn't a particularly useful framing.
I think it's what can happen when we shift more towards an exchange orientation and away from a communal orientation. Or in other words, as we see the world more win-lose and less win-win.
It’s a silly question, since (short of a major life change or economic system change) you need the grocery store and the job to have decent quality of life.
You need to trade your labor for money, and you need to trade your money for food. I would argue that there isn’t a huge difference in the fundamental nature of those two trades. Framing them in terms of “trade deficits” is pointing out which direction money is moving in each instance, but fundamentally they’re both just trades.
Indeed that is true, which is the point of both OP(or at least my takeaway). Attaching a moral value to trade deficits or surpluses, as the current administration seems to be in favor of doing, is fairly nonsensical.
The most impressive thing about Trump is that he managed to shorten up the feedback loops on an overwhelming number of his policies.
You would expect the US industry to silently absorb his trade policies and only break decades after he leaves. Somehow, they aren't healthy enough for that.
People are very quick to make kneejerk reactions to tariffs while assuming the other guys have different opinions.
The Biden admin went after Canada repeatedly for unfair trade practices, and issued a blanket 10% tariff on Chinese goods.
The only difference is to what degree they wield the tariff hammer, and in which direction it is swung.
The one thing the current admin does have a point on is non-tariff meddling. Numerous countries make it almost impossible to sell goods in their countries while the same is not true in reverse, or they levy a high price in garbage regulatory fees (see the EU's new packaging identification directive that completely destroys small business), or in completely made-up fines for vague behaviors not even they can define (see the EU's DSA which is exclusively used against monopolizing American companies while completely ignoring monopolist and predatory EU ones like Booking.com).
> The only difference is to what degree they wield the tariff hammer, and in which direction it is swung.
Which is a huge difference. Targetted tariffs can induce compliance with desired trade practices and influence purchasing towards more desirable sources.
Global blanket tariffs on products without domestic sources of substitute goods is effective for increasing domestic prices and encouraging foreign producers to enhance their ex-US trade networks.
If you wanted to encouage local manufacturing, you would add tariffs on finished goods, but leave raw materials untariffed. You might consider tariffing raw materials with ample local capacity. You might carefully consider tariffs for machine tools and other finshed goods which are necessary for manufacturing where there's not current local production capacity.
You might consider reciprocal tarrifs that were actually reciprocal tariffs... you tarrif me, I tariff you. Not tarrifs on countries that have an export surplus because they can't afford to import goods from the US.
I don't really have any idea if tariffs are good or bad. What I do know is that just announcing that they will go into effect with very little notice and then they won't go into effect and then they do but then they are decalared illegal because they weren't passed through the official methods isn't good.
> I don't really have any idea if tariffs are good or bad.
tariffs are objectively* bad from a "big picture" perspective.
There are some situations where they create winners and losers so that some people in some countries will win, but they always do more damage than good "overall"(or in aggregate across all parties).
*in almost all cases... For certain goods where you actually want to lower consumption such as cigarettes, then maybe arguably they are good? Same argument as for https://en.wikipedia.org/wiki/Pigouvian_tax
It was _great_ for the companies that collected billions in tariffs and got refunds when the obviously illegal tariffs were declared illegal while training their customers to accept higher prices... that certainly won't go back to pre-tariff levels.
> The only difference is to what degree they wield the tariff hammer, and in which direction it is swung.
You are ignoring a massive difference. Trump wants balanced trade with each individual country. Pretty much everyone else who wants the US to reduce or eliminate its trade deficit just wants that to apply to total trade, not to each individual country.
The main reason money was invented was so you don't have to have balanced trade with each individual trading partner.
It's also not the only European company to be designated as VLOP, as you'll find some EU-based adult content sites on that page as well, but if you really want a European company that is inexplicably missing from this list, I'd go with Spotify.
> The only difference is to what degree they wield the tariff hammer, and in which direction it is swung.
I mean that's the point, no? Swing the hammer carefully at a nail or with maximum force at your own leg?
Or to drop the metaphor - much of the difference between good and bad policy is a difference in degree. So your counterargument here is valid against "all tariffs are bad" but I believe the point most are making is "the current admin's use of tariffs is bad" which makes your counter appear as a bad-faith mischaracterization.
There was a big discussion of this recently here, which will give you more information, but yes, it is in fact destroying a large number of EU small businesses.
The EU has recognized this and they are scrambling to fix it in legislation due later this year.
This regulation forces very small businesses to pay thousands and thousands of dollars to comply and register in EACH EU country (what the hell's the point of the union, exactly?). Even if they sell only 10 widgets to Belgian buyers, they need to register in Belgium and pay the fee. Insane.
So a small business selling 5-10k of widgets in EU now has to pay 2-5k in business destroying regulatory compliance fees, putting them out of business. Incredible incompetence from the people who brought you ineffective cookie nag screens.
It's not possible to exist as a small business in the EU because they create regulations to destroy you.
Try creating a business in Germany. You need 25,000 euros to create a GmbH! In the US you can walk into the office in New York City and have an LLC for $9 per 2 years.
The EU is a nightmare hellscape of over-regulation. This is why there are essentially zero EU unicorns. EU bureaucrats support ONLY large and entrenched businesses.
The United States proposed a deal to France, Germany, Japan, and Britain (the G5): you buy up your own currencies, the dollar falls, and in return we reduce our budget deficit, meaning you no longer have to effectively finance U.S. development.
The United States agreed to reduce its budget deficit and lower interest rates. The other parties to the agreement committed to raising theirs. In addition, West Germany agreed to cut taxes, while Japan agreed to allow the yen to appreciate. As a result, over the following two years the U.S. dollar fell by 46% against the German mark and by 50% against the yen. However, the U.S. government ultimately failed to reduce its budget deficit. Meanwhile, the sharp appreciation of the yen made Japanese exporters less competitive in foreign markets. In the United States, by contrast, the period following the agreement saw substantial economic growth and low inflation.
A classic American move: promise the world — we’re all in this together, we’re marching toward a brighter future — and then screw everyone over.
This is a pretty reductive take. If a nation works 6 days a week, 12 hours a shift then obviously they will outcompete any nation where people work 5 days a week for 8 hours.
Protecting workers from that kind of competition seems fair. Tariffs aren't bad in itself. They are just a tool.
Unfortunately fools wielding a tool like this can cause a lot of damage, but that's true for any tool.
> Protecting workers from that kind of competition seems fair. Tariffs aren't bad in itself. They are just a tool.
At the cost of consumers paying for goods/services?
Your take is as reductive as the take in the comics.
People in a nation working 5 days a week for 8 hours are getting paid less and less over time. Heck lot of people now need double shifts to make ends meet totaling up to 12 hr or even more. They can only afford a Christmas light from the nation mass producing it by working 6 days a week, 12 hr shift.
And lets not pretend this was only about protecting workers. There were multiple agendas:
1. Bring back jobs 2. Remove trade barriers between countries 3. Make US rich by collecting huge amount of tariffs
All three can't be true at the same time. If jobs are brought back then you aren't going to collect huge amount of tariffs because nothing is being produced outside. If trade barriers are removed then that comes at a cost of slashing tariffs so you can't really collect huge amount of tariffs.
The foolish reasoning highlighted in the comics is the reason there is so much trade war.
The comic satirizes the 2026 US tariff rationale, vs. worker protection tariffs. But I do often think about Noam Chomsky's opposition to NAFTA[0] when talking heads explain why tariffs are bad.
"If a nation works 6 days a week, 12 hours a shift then obviously they will outcompete any nation where people work 5 days a week for 8 hours." - This is not obviously true to me, can you explain why it is for you?
Although it is not a law of nature, and it is not linear across the hours.. In general if I work M-F more work will be done that if I just work on Monday morning.
"As of July 2022, more than 80 UK companies and organisations are recognised as having permanently implemented a four-day working week"
"As 50% of workers claim improved productivity during the period, the Manufacturing Technology Centre (MTC) announced it will permanently provide a four-day workweek to its 820 employees"
So you’re saying if I work at mcdonalds 60 hours a week i’ll make more than an investment banker working 40 hours a week? Awesome, i’m filling out a job application now!
Imagine a factory line where each worker makes 10 items per hour.
In, say, China a worker doing 996 will make 720 items. Te average working hours in the Netherlands are 36 hours or so per week. Making 360 items.
As long as there is free trade the Chinese factory will simply outproduce the Dutch one since they utilise their capex better.
Obviously European workers can't be reasonably asked to compete in an open market when labour laws, salary, health inspection etc... in China are at a 1920 Dutch level.
Are you aware of comparative advantage? What matters is opportunity cost, not raw output. (Also, unit labor cost is wage per hour divided by output per hour, so the number of hours worked is not really relevant. In other words, longer hours make workers richer and not their output cheaper.)
This was worked out by David Ricardo 200 years ago. You still benefit from trade even if (granting the argument) you are worse at producing everything.
Right at first approximation you'd certainly think so!
At second approximation, the <Dutch> factory in that example might net make a larger number of items per hour because the workers are more alert and concentrated and make less mistakes. So the <dutch> factory and the <chinese> factory might actually be producing the same number of items.
Of course then there's more steps to this, and you need to start actually looking at systems and what you're optimizing for etc etc.
And, not everything is factories. For instance, if your operator (at eg. Smit or Mammoet) is operating a large crane that's lifting a 100 ton oil platform, maybe you'd prefer them to be wide awake and on the ball, regardless.
So this is just not correct.
First off a factory can run 24/7 regardless of the shift length, which is what will determine the total productivity.
Second off it assumes there are no trade offs in terms of more errors or anything else by having longer shifts.
Third off it assumes that factories in different countries are going to be equally effective with each other, instead of different nations/areas within nations specializing in certain areas.
It also ignores the economic benefits that come with having people in your nation having more leisure time, higher education, more time with children, etc. It's a very simplistic model that is also very incorrect.
Protecting Workers, I'd add a couple more; it's not smart to be fully dependent on a trading partner or partners for critical and essential products, such as food, tariffs can help ensure you maintain domestic industry. Also helping to control dumping by an aggressive trade partner to ensure a domestic industry isn't destroyed.
Eh, I think every industrial society has independently arrived at something like 36-44 hours of factory time per week (plus overtime up to a max of something like 55 hours) , simply because that's the actual optimum[1]. While tariffs might work for other stuff [2], I think you're right that they can be a narrowly applicable scalpel, but plausibly you accidentally picked a bad example.
[1] Caveats apply. For example more advanced machinery with higher stress may necessitate shorter shifts; while highly motivated creative work might permit longer shifts at times.
[2] Adam Smith -for instance- was mostly against tariffs, though he identified certain exceptions such as national defense reasons.
You seem to be assuming that productivity scales linearly with time spent working, which doesn't seem to inherently be true.
If your factory workers spend twice as long working, it's likely that more widgets will get made. I'm not certain you can generalize too far from that, though.
Just as a note: if you work 6x12 shifts, you're actually working less efficiently, because you'll be regularly fatigued, make more mistakes, need more rework, etc etc. You might end up with the same net yield as if you'd done 3x6 hour shifts.
(edit: And only if you don't fall asleep at the controls and destroy the factory first. 12 hour shifts are brutal. At least one place I know bans you the next day if you exceed 11h, for your own protection if nothing else)
(edit2: This was documented in the 1st world war when munitions factories that tried to ramp up by increasing shift durations past a certain point ended up hardly improving productivity, but did increase accident and sickness rates to the point that it was starting to hurt the war effort. )
Unfortunately in our hyper partisan, sound bite, climate you can’t discuss the trade offs of tax policies anymore you either support the party line or you’re the enemy.
Context is important. 100% tariffs on Canada is stupid, 100% tariffs on China because we don’t want any industry dependent on a major military adversary is something worth discussing even if the answer is to not do that in the end
It would certainly help if people wouldn't believe flat-out lies.
Like, "other countries pay the tariffs."
No. They don't.
How can we have nuanced conversation about the trade-offs, if the leader of one political party blatantly lies about a fundamental detail of how tariffs work?
600% reduction in the price of drugs?
We can't even start a discussion with people who believe this. At all. They reject any information, even their own knowledge of how numbers work.
I have never met anyone who thought other countries paid the tariffs. Im sure they exist but this seems more like something retractors say to make themselves feel smarter than people in support of tariffs. People who care at all about tariffs tend to know how they work.
The president says a lot of really stupid things and those stupid things are highlighted, but that’s not indicative of the average and one of the main talking points about tariffs is that they increase costs in order to incentivize local suppliers
Merriam-Webster: "The meaning of TARIFF is a schedule of duties imposed by a government on imported or in some countries exported goods."
Apparently the dictionary is "woke."
Wikipedia: "A tariff, or import tax, is a duty imposed by a national government, customs territory, or supranational union on imports of goods and is paid by the importer."
Oxford Economics: "Tariffs are taxes imposed by a government on goods and services imported from other countries."
I totally agree trade should feel fair. If the US sends jobs, money, food or goods to other countries, then we shouldn't get garbage back.
Tariffs are a way of warning other countries "don’t take us for a ride." They help American workers, factories and towns that were hurt when jobs went overseas.
Tariffs shouldn't feel like hurting yourself for no reason. They are an important tool for standing up for yourself when other countries (to say nothing of bad trade deals) want to take advantage of you
You act as if it's the countries that are doing the trading; it's not. It is the businesses and other entities within the countries that are doing it. They are doing it because it benefits them. If a company is doing overseas manufacturing it is because they benefit and it isn't the United States that made that decision.
Tarrifs are the worst decision a politician can make.
The main reason we have open-ish border for people and goods is to reduce the risk of war. You are not going to wage war with a country that do business with.
It's a surplus tax, and one that apparently doesn't exist for the majority of dairy imports: https://archive.is/kKsYc
that tariff would only apply if we were able to reach and exceed the quota on U.S. dairy exports agreed to under the U.S.-Mexico-Canada Agreement (USMCA).
[...] the U.S. has never gotten close to exceeding our USMCA quotas
The idea that trade decreases the risk of war is old. It dates back to pre-WW1.
Think tanks around Europe were celebrating an "end to hostilities". And then WW1 happened. Trade does not prevent war. War is not always a rational consequence or act.
What does prevent war is a good standard of living. Eliminate resentment, and one of the great causes of war is lost.
Whether you need tariffs or not to ensure good standard of living I don't know. But the goal should always be to increase standard of living and uphold justice, tariffs or not.
They're not robbing us blind. They're taking care of our manufacturing so that we can invest in things like the financial industry, fossil fuels, and AI.
Feel free to start your own factory in US, nobody is stopping you. Just keep in mind that for commoditized products (most consumer stuff, for example), prices are all that matter. "Buy American" is not a product feature.
Some years ago. I learned about a new -ish technology that fascinated me. I started to research ways to get in on the development of this technology: i.e. what sort of opportunities might there be for a startup or small business in the space.
The answer I found was very sobering and mildly depressing. There was no room for developing the technology itself. That had already been done by large companies with the capital and resources to commoditize things early.
Instead, the real opportunities were found in business/management consulting selling the product and tangential things, like having a construction company to help build out infrastructure needed for the technology.
At this point I think technology no longer interests me because it doesn’t have a place for me.
> Maybe letting other countries rob us blind is worse.
I find this argument interesting because the US economy is the largest in the entire world by a fairly wide margin. That the US is being robbed implies it's operating from a position of weakness, which is an absurd idea.
Are other countries with factories really responsible for US companies outsourcing manufacturing to them? Do you want cheap goods or do you want your fellow Americans paid pennies?
Reference to Aesop's fable?
https://en.wikipedia.org/wiki/The_Belly_and_the_Members
> The present understanding is that the tale's moral supports team effort and recognition of the vital part that all members play in it. In more authoritarian times, however, the fable was taken to affirm direction from the centre.
Oof.
A current account deficit is a capital account surplus. Persistent deficits shift the balance between Asset vs Export sectors, dumping the export sector and pumping the asset sector. Put differently, we can pay for imports with shit that we make or shit that we own -- and this has implications for people in our country who make shit vs own shit.
A better analogy for the trade deficit would be sitting on the couch slamming potato chips and observing the shift in our body away from muscles and towards fatty tissue. Should we be excited to see this example of specialization in action? Is it wrong to want to fix our diet and push our body composition in the opposite direction?
https://yalebooks.yale.edu/book/9780300261448/trade-wars-are...
It’s reasonable to want to bring back american manufacturing. But the random, temper-tantrum, market-manipulation tariffs are not going to do that. America isn’t going to all of a sudden produce tonnes and tonnes of xmas decorations every year just because of a 50% tariff on all chinese goods that may or may not be around in 6 months. All that’s going to happen is xmas decorations are going to be more expensive.
An actual plan would be targeting specific industries where america has the ability to scale up, and having congress pass tariffs that slowly ramp up over time to allow a smooth transition.
Your framing is ridiculous. Canada sends raw materials to the USA and purchases it back once transformed. If anyone has been bleeding it is Canada.
And for aluminum in particular, the US is essentially importing dirt-cheap hydro energy.
Put differently, Trump is explicitly attempting to destroy the reason the American stock market generally goes up.
That is not what the user above you said.
They're explicitly pointing out that the US (and most of the western world) has abandoned the manufacturing sector of their economy, outsourcing work that used to employ millions of people to the developing world.
This is a trade-off that can benefit both countries, but, it is wise to consider both WHO benefits from this, and what the LONG-TERM implications of this entails. It's great for an investor class in America that has the capital to create factories in China, and it's great for China to take USD and start to employ their workforce. But, the question is whether or not this is actually a good thing for the American worker.
The rust-belt would certainly have an opinion on this. My father was a factory worker that was able to support a family on a single income, and when that manufacturing plant closed, it absolutely destroyed the finances of my family.
This is a false dichotomy.
I personally believe that strategic tariffs should be used to protect our national interests, including providing meaningful employment.
This administration has no interest in strategic tariffs. Instead, they are made overbroad (50% on everything from Canada vs, say, cheap imported steel) and they are made and removed capriciously (tariffs on English whisky dropped after King Charles' visit to the White House).
If Trump really wanted to bring your dad's factory job back, he'd specifically target whatever industry he was working in AND ideally spend the tariff money boosting that industry. This is precisely the strategy countries like Japan used to reach first world status.
Instead Trump uses tariffs like a cudgel -- much closer to what the XKCD comic depicts. There is no chance his tariffs will lead to your father's factory ever being reopened, as that would require, at the bare minimum, a tariff that investors know will stay in place for years, as opposed to one that could be lifted with the visit of a charismatic member of nobility.
[...wanted to bring your dad's factory job back, he'd specifically target whatever industry he was working in AND ideally spend the tariff money boosting that industry.]
Which was more or less the intent of the CHIPS and Science Act for the semiconductors industry.
Oh, I agree that the way that the tariffs are currently being levied is embarrassing on a national scale. Also on the fact that meaningful economic change won't happen when these tariffs will disappear/re-appear at the drop of a hat.
It's also worth pointing out that while, yes, there is 50% tariff on Canadian goods, this only effects ~5% of imported goods, meaning 95% of the Canadian imports are unaffected by this nonsense.
It's also worth pointing out that some of these tariffs actually are being used to help build out US industry, like the CHIPS act.
I don't think that we disagree on anything here, haha
Yes, but I'm pretty sure he doesn't know that and thinks flapping between protectionism and TACO is a brilliant strategy for achieving the best of both worlds rather than an idiotic strategy guaranteed to result in the worst of both worlds.
"Destroy American affluence so that we can't pay with assets instead of exports" is probably the worst conceivable way to unwind the exorbitant privilege of the American Economy. We could have spent that money helping people, instead we spent it on wars and tax breaks for billionaires. We could have spent that money on targeted industrial policy (the IRA and CHIPS acts under Biden were examples of this done right, just not at the scale we needed) but instead we are doing it the hard way. Sigh.
To make the analogy even more perfect, the character should be holding a saw rather than a hammer.
Or a gun, because America is famous for its gun culture, and it would be more clearly "shooting yourself in the foot".
The context here is that president Trump has an interesting view of trade deficits / surpluses. Specifically, he frequently cites cases where the US has a trade deficit with another country -- where the US is spending more in that country than that country is in the US -- as if that country is "taking money" from the US.
This is a bit peculiar, because it ignores the whole "the money we are spending is being exchanged for goods that come back to the US" part of the trade. I.e. it's not a problem that I have a "trade deficit" with the grocery store, because I have my groceries.
https://finance.yahoo.com/economy/policy/articles/trump-brag...
Actually you, like most of us, have a trade deficit with the grocery store and the movie theater, and a trade surplus with your employer. Which one is more enjoyable to have?
The experience of the trade deficit with the grocery store and the movie theater is more enjoyable, overall. I get films and ice cream and a good time out of it. From my employer I get a lot of sitting in meetings -- they have to pay me to make me put up with that!
My point is that reducing it entirely to "did I gain or receive cash-money from this?" isn't a particularly useful framing.
I think it's what can happen when we shift more towards an exchange orientation and away from a communal orientation. Or in other words, as we see the world more win-lose and less win-win.
It’s a silly question, since (short of a major life change or economic system change) you need the grocery store and the job to have decent quality of life.
You need to trade your labor for money, and you need to trade your money for food. I would argue that there isn’t a huge difference in the fundamental nature of those two trades. Framing them in terms of “trade deficits” is pointing out which direction money is moving in each instance, but fundamentally they’re both just trades.
Indeed that is true, which is the point of both OP(or at least my takeaway). Attaching a moral value to trade deficits or surpluses, as the current administration seems to be in favor of doing, is fairly nonsensical.
It also excludes money spent on services, which in most cases favours the US.
Look, my trade deficit with my barber is a real problem in our relationship. I need them to give me $20 for something, damnit.
I think a lesson is going to be taught, all right.
Unfortunately the feedback loop in nations is much slower than in bodies.
That’s the whole trick: if the feedback cycle is long enough, the next person gets blamed for it, not the current.
And likewise for the next person trying to take the credit for things that the previous one did when the effects take time to manifest: https://www.theguardian.com/us-news/2026/aug/15/trump-washin...
The most impressive thing about Trump is that he managed to shorten up the feedback loops on an overwhelming number of his policies.
You would expect the US industry to silently absorb his trade policies and only break decades after he leaves. Somehow, they aren't healthy enough for that.
Slack is expensive. At least it has a cost that is not always appreciated.
Everyone has been optimizing to increase profits for decades. A 1950's US economy would have taken a lot longer to collapse.
I think we’re on course to be in really rough shape by 2028. I hope it’s rough enough to spark genuine change in our politics.
I think we’re on course to be in really rough shape by 2028.
Exactly: just in time for somebody else to take the blame.
Expert economists working in both the Biden and Trump administration support tariffs.
The difference is the dumb way Trump is doing them and a smarter way of doing them.
Obviously, this comic completely misses that nuance and promotes a pseudoscientific idea that tariffs are somehow bad.
I think the 'tariffs' in this comic are related to the current regimes application of them. Not representative of tariffs as a whole.
People are very quick to make kneejerk reactions to tariffs while assuming the other guys have different opinions.
The Biden admin went after Canada repeatedly for unfair trade practices, and issued a blanket 10% tariff on Chinese goods.
The only difference is to what degree they wield the tariff hammer, and in which direction it is swung.
The one thing the current admin does have a point on is non-tariff meddling. Numerous countries make it almost impossible to sell goods in their countries while the same is not true in reverse, or they levy a high price in garbage regulatory fees (see the EU's new packaging identification directive that completely destroys small business), or in completely made-up fines for vague behaviors not even they can define (see the EU's DSA which is exclusively used against monopolizing American companies while completely ignoring monopolist and predatory EU ones like Booking.com).
> The only difference is to what degree they wield the tariff hammer, and in which direction it is swung.
Which is a huge difference. Targetted tariffs can induce compliance with desired trade practices and influence purchasing towards more desirable sources.
Global blanket tariffs on products without domestic sources of substitute goods is effective for increasing domestic prices and encouraging foreign producers to enhance their ex-US trade networks.
If you wanted to encouage local manufacturing, you would add tariffs on finished goods, but leave raw materials untariffed. You might consider tariffing raw materials with ample local capacity. You might carefully consider tariffs for machine tools and other finshed goods which are necessary for manufacturing where there's not current local production capacity.
You might consider reciprocal tarrifs that were actually reciprocal tariffs... you tarrif me, I tariff you. Not tarrifs on countries that have an export surplus because they can't afford to import goods from the US.
I don't really have any idea if tariffs are good or bad. What I do know is that just announcing that they will go into effect with very little notice and then they won't go into effect and then they do but then they are decalared illegal because they weren't passed through the official methods isn't good.
> I don't really have any idea if tariffs are good or bad.
tariffs are objectively* bad from a "big picture" perspective.
There are some situations where they create winners and losers so that some people in some countries will win, but they always do more damage than good "overall"(or in aggregate across all parties).
A link to the math behind it: https://en.wikipedia.org/wiki/Deadweight_loss
*in almost all cases... For certain goods where you actually want to lower consumption such as cigarettes, then maybe arguably they are good? Same argument as for https://en.wikipedia.org/wiki/Pigouvian_tax
It was _great_ for the companies that collected billions in tariffs and got refunds when the obviously illegal tariffs were declared illegal while training their customers to accept higher prices... that certainly won't go back to pre-tariff levels.
> The only difference is to what degree they wield the tariff hammer, and in which direction it is swung.
You are ignoring a massive difference. Trump wants balanced trade with each individual country. Pretty much everyone else who wants the US to reduce or eliminate its trade deficit just wants that to apply to total trade, not to each individual country.
The main reason money was invented was so you don't have to have balanced trade with each individual trading partner.
What is booking.com doing that violates DSA?
It operates as a monopoly and 10,000 hotels have sued it for anti-trust in Europe.
Despite qualifying for DSA thresholds, the EU pretends it doesn't exist and is not a monopoly. Because it's not American.
Booking.com literally is classified as a VLOP (very large online platform) under DSA: https://digital-strategy.ec.europa.eu/en/policies/list-desig...
It's also not the only European company to be designated as VLOP, as you'll find some EU-based adult content sites on that page as well, but if you really want a European company that is inexplicably missing from this list, I'd go with Spotify.
> The only difference is to what degree they wield the tariff hammer, and in which direction it is swung.
I mean that's the point, no? Swing the hammer carefully at a nail or with maximum force at your own leg?
Or to drop the metaphor - much of the difference between good and bad policy is a difference in degree. So your counterargument here is valid against "all tariffs are bad" but I believe the point most are making is "the current admin's use of tariffs is bad" which makes your counter appear as a bad-faith mischaracterization.
> The Biden admin went after Canada repeatedly for unfair trade practices […]
What were these practices?
Softwood dumping by Canada has been a huge issue for over 40 years.
https://en.wikipedia.org/wiki/Canada%E2%80%93United_States_s...
> completely destroys small business
Citation needed, I'm in the EU and there is small business
There was a big discussion of this recently here, which will give you more information, but yes, it is in fact destroying a large number of EU small businesses.
The EU has recognized this and they are scrambling to fix it in legislation due later this year.
So we've gone from "completely" to "partially", and the source is still just handwaved?
Here's the 1000+ comment discussion of this from a few days ago: https://news.ycombinator.com/item?id=49419237
https://www.recyclingtoday.com/news/eu-ppwr-pause-request-us...
This regulation forces very small businesses to pay thousands and thousands of dollars to comply and register in EACH EU country (what the hell's the point of the union, exactly?). Even if they sell only 10 widgets to Belgian buyers, they need to register in Belgium and pay the fee. Insane.
So a small business selling 5-10k of widgets in EU now has to pay 2-5k in business destroying regulatory compliance fees, putting them out of business. Incredible incompetence from the people who brought you ineffective cookie nag screens.
It's not possible to exist as a small business in the EU because they create regulations to destroy you.
Try creating a business in Germany. You need 25,000 euros to create a GmbH! In the US you can walk into the office in New York City and have an LLC for $9 per 2 years.
The EU is a nightmare hellscape of over-regulation. This is why there are essentially zero EU unicorns. EU bureaucrats support ONLY large and entrenched businesses.
Tariffs are bad. Unless you're not the US.
1985
https://en.wikipedia.org/wiki/Plaza_Accord
The United States proposed a deal to France, Germany, Japan, and Britain (the G5): you buy up your own currencies, the dollar falls, and in return we reduce our budget deficit, meaning you no longer have to effectively finance U.S. development.
The United States agreed to reduce its budget deficit and lower interest rates. The other parties to the agreement committed to raising theirs. In addition, West Germany agreed to cut taxes, while Japan agreed to allow the yen to appreciate. As a result, over the following two years the U.S. dollar fell by 46% against the German mark and by 50% against the yen. However, the U.S. government ultimately failed to reduce its budget deficit. Meanwhile, the sharp appreciation of the yen made Japanese exporters less competitive in foreign markets. In the United States, by contrast, the period following the agreement saw substantial economic growth and low inflation.
A classic American move: promise the world — we’re all in this together, we’re marching toward a brighter future — and then screw everyone over.
Tariffs are bad unless you’re a domestic producer of a good that has just been tariffed, and now you have less competition and can raise your prices.
Or, rather, you must raise your prices because Orange Foolius has tariffed your manufacturing inputs.
That’s what I said - it’s bad for everyone except domestic producers of tariffed stuff. So, bad for consumers, producers of downstream goods, etc.
Here buddy, you dropped this straw.
This is a pretty reductive take. If a nation works 6 days a week, 12 hours a shift then obviously they will outcompete any nation where people work 5 days a week for 8 hours.
Protecting workers from that kind of competition seems fair. Tariffs aren't bad in itself. They are just a tool.
Unfortunately fools wielding a tool like this can cause a lot of damage, but that's true for any tool.
> Protecting workers from that kind of competition seems fair. Tariffs aren't bad in itself. They are just a tool.
At the cost of consumers paying for goods/services?
Your take is as reductive as the take in the comics.
People in a nation working 5 days a week for 8 hours are getting paid less and less over time. Heck lot of people now need double shifts to make ends meet totaling up to 12 hr or even more. They can only afford a Christmas light from the nation mass producing it by working 6 days a week, 12 hr shift.
And lets not pretend this was only about protecting workers. There were multiple agendas:
1. Bring back jobs 2. Remove trade barriers between countries 3. Make US rich by collecting huge amount of tariffs
All three can't be true at the same time. If jobs are brought back then you aren't going to collect huge amount of tariffs because nothing is being produced outside. If trade barriers are removed then that comes at a cost of slashing tariffs so you can't really collect huge amount of tariffs.
The foolish reasoning highlighted in the comics is the reason there is so much trade war.
The comic satirizes the 2026 US tariff rationale, vs. worker protection tariffs. But I do often think about Noam Chomsky's opposition to NAFTA[0] when talking heads explain why tariffs are bad.
[0]: <https://chomsky.info/secrets03/>
"If a nation works 6 days a week, 12 hours a shift then obviously they will outcompete any nation where people work 5 days a week for 8 hours." - This is not obviously true to me, can you explain why it is for you?
Although it is not a law of nature, and it is not linear across the hours.. In general if I work M-F more work will be done that if I just work on Monday morning.
https://en.wikipedia.org/wiki/Four-day_workweek
"As of July 2022, more than 80 UK companies and organisations are recognised as having permanently implemented a four-day working week"
"As 50% of workers claim improved productivity during the period, the Manufacturing Technology Centre (MTC) announced it will permanently provide a four-day workweek to its 820 employees"
It is clear that more work is done if you go from 1 day to 5 or 1 hour to 8, but that still includes plenty of time for rest.
Does the same hold for going from 5 days to 7 days or 8 hours to 16 hours?
A reasonable person should agree at some point adding more time will make people less productive due to lack of breaks, rest, etc.
Is it obvious where the line is? if so, where?
So you’re saying if I work at mcdonalds 60 hours a week i’ll make more than an investment banker working 40 hours a week? Awesome, i’m filling out a job application now!
Imagine a factory line where each worker makes 10 items per hour.
In, say, China a worker doing 996 will make 720 items. Te average working hours in the Netherlands are 36 hours or so per week. Making 360 items.
As long as there is free trade the Chinese factory will simply outproduce the Dutch one since they utilise their capex better.
Obviously European workers can't be reasonably asked to compete in an open market when labour laws, salary, health inspection etc... in China are at a 1920 Dutch level.
Are you aware of comparative advantage? What matters is opportunity cost, not raw output. (Also, unit labor cost is wage per hour divided by output per hour, so the number of hours worked is not really relevant. In other words, longer hours make workers richer and not their output cheaper.)
This was worked out by David Ricardo 200 years ago. You still benefit from trade even if (granting the argument) you are worse at producing everything.
So since the math extrapolates linearly and there is apparently no cost, why would anyone settle for anything other than 1680 items per week?
Right at first approximation you'd certainly think so!
At second approximation, the <Dutch> factory in that example might net make a larger number of items per hour because the workers are more alert and concentrated and make less mistakes. So the <dutch> factory and the <chinese> factory might actually be producing the same number of items.
Of course then there's more steps to this, and you need to start actually looking at systems and what you're optimizing for etc etc.
And, not everything is factories. For instance, if your operator (at eg. Smit or Mammoet) is operating a large crane that's lifting a 100 ton oil platform, maybe you'd prefer them to be wide awake and on the ball, regardless.
So this is just not correct. First off a factory can run 24/7 regardless of the shift length, which is what will determine the total productivity. Second off it assumes there are no trade offs in terms of more errors or anything else by having longer shifts. Third off it assumes that factories in different countries are going to be equally effective with each other, instead of different nations/areas within nations specializing in certain areas. It also ignores the economic benefits that come with having people in your nation having more leisure time, higher education, more time with children, etc. It's a very simplistic model that is also very incorrect.
It's not a perfect example of course but the gist that tariffs do and should protect workers is true.
Tariffs aren't inherently bad, they're a tool.
Protecting Workers, I'd add a couple more; it's not smart to be fully dependent on a trading partner or partners for critical and essential products, such as food, tariffs can help ensure you maintain domestic industry. Also helping to control dumping by an aggressive trade partner to ensure a domestic industry isn't destroyed.
Eh, I think every industrial society has independently arrived at something like 36-44 hours of factory time per week (plus overtime up to a max of something like 55 hours) , simply because that's the actual optimum[1]. While tariffs might work for other stuff [2], I think you're right that they can be a narrowly applicable scalpel, but plausibly you accidentally picked a bad example.
[1] Caveats apply. For example more advanced machinery with higher stress may necessitate shorter shifts; while highly motivated creative work might permit longer shifts at times.
[2] Adam Smith -for instance- was mostly against tariffs, though he identified certain exceptions such as national defense reasons.
You seem to be assuming that productivity scales linearly with time spent working, which doesn't seem to inherently be true.
If your factory workers spend twice as long working, it's likely that more widgets will get made. I'm not certain you can generalize too far from that, though.
This is an example of “person pretends to not understand a simple thing thus naming conversation impossible”
Just as a note: if you work 6x12 shifts, you're actually working less efficiently, because you'll be regularly fatigued, make more mistakes, need more rework, etc etc. You might end up with the same net yield as if you'd done 3x6 hour shifts.
(edit: And only if you don't fall asleep at the controls and destroy the factory first. 12 hour shifts are brutal. At least one place I know bans you the next day if you exceed 11h, for your own protection if nothing else)
(edit2: This was documented in the 1st world war when munitions factories that tried to ramp up by increasing shift durations past a certain point ended up hardly improving productivity, but did increase accident and sickness rates to the point that it was starting to hurt the war effort. )
> This is a pretty reductive take.
Yes, because it's a one-panel comic.
That is a ... pretty reductive take as well.
I don't think the comic is claiming that all tariffs in any context are bad, that would indeed be a reductive, bad take.
Given the timing and the metaphor of blood being sent to and from a limb, this is almost surely a reference to the tariff threats against Canada.
Oh this is a good point. I was not aware of new developments with US-Canada today, that makes the more-than-normal stingy reactions expected.
Sorry, I'm European and can't keep up with the erratic US Gov. I read a summary at the end of the week.
Unfortunately in our hyper partisan, sound bite, climate you can’t discuss the trade offs of tax policies anymore you either support the party line or you’re the enemy.
I am European... Tariffs are completely normal here we protect our workers all the time.
It seems I've 'stung the wasps nest' on HN by not denouncing them outright it seems.
How many 100% tariffs do you have on every good from an entire country?
A scalpel is one thing.
Dynamite is something else.
Context is important. 100% tariffs on Canada is stupid, 100% tariffs on China because we don’t want any industry dependent on a major military adversary is something worth discussing even if the answer is to not do that in the end
I was not aware this comic was a reation to new developments for US-CAN. I thought it was just a generic take on tarrifs and responded accordingly.
I agree the current US strategy behind tariffs is pretty retarded. Good example of fools trying to use a powerful tool.
Yeah, I think you've got it. Agreeing with you and continuing my thought:
If I had to guess at the comic author's intention...
It's commentary that the logic is flawed. If this is why you're doing tariffs, you're not using them correctly.
Not that tariffs should never be used.
It would certainly help if people wouldn't believe flat-out lies.
Like, "other countries pay the tariffs."
No. They don't.
How can we have nuanced conversation about the trade-offs, if the leader of one political party blatantly lies about a fundamental detail of how tariffs work?
600% reduction in the price of drugs?
We can't even start a discussion with people who believe this. At all. They reject any information, even their own knowledge of how numbers work.
I have never met anyone who thought other countries paid the tariffs. Im sure they exist but this seems more like something retractors say to make themselves feel smarter than people in support of tariffs. People who care at all about tariffs tend to know how they work.
The president says a lot of really stupid things and those stupid things are highlighted, but that’s not indicative of the average and one of the main talking points about tariffs is that they increase costs in order to incentivize local suppliers
I wish we would call them "taxes on imports" instead to reflect what is actually happening.
100% agree
Merriam-Webster: "The meaning of TARIFF is a schedule of duties imposed by a government on imported or in some countries exported goods."
Apparently the dictionary is "woke."
Wikipedia: "A tariff, or import tax, is a duty imposed by a national government, customs territory, or supranational union on imports of goods and is paid by the importer."
Oxford Economics: "Tariffs are taxes imposed by a government on goods and services imported from other countries."
My dad worked 12 hour shifts for decades (4 days on, 4 days off). Anyone working 72 hours a week isn't going to last long.
I never realized I've been working this much.
I totally agree trade should feel fair. If the US sends jobs, money, food or goods to other countries, then we shouldn't get garbage back.
Tariffs are a way of warning other countries "don’t take us for a ride." They help American workers, factories and towns that were hurt when jobs went overseas.
Tariffs shouldn't feel like hurting yourself for no reason. They are an important tool for standing up for yourself when other countries (to say nothing of bad trade deals) want to take advantage of you
You act as if it's the countries that are doing the trading; it's not. It is the businesses and other entities within the countries that are doing it. They are doing it because it benefits them. If a company is doing overseas manufacturing it is because they benefit and it isn't the United States that made that decision.
Tarrifs are the worst decision a politician can make.
The main reason we have open-ish border for people and goods is to reduce the risk of war. You are not going to wage war with a country that do business with.
This undermines this idea.
Then why did Canadian politicians tax milk products at > 200%? https://www.cbsa-asfc.gc.ca/trade-commerce/tariff-tarif/2024...
(starting long before the current trade war)
It's a surplus tax, and one that apparently doesn't exist for the majority of dairy imports: https://archive.is/kKsYc
The idea that trade decreases the risk of war is old. It dates back to pre-WW1.
Think tanks around Europe were celebrating an "end to hostilities". And then WW1 happened. Trade does not prevent war. War is not always a rational consequence or act.
What does prevent war is a good standard of living. Eliminate resentment, and one of the great causes of war is lost.
Whether you need tariffs or not to ensure good standard of living I don't know. But the goal should always be to increase standard of living and uphold justice, tariffs or not.
Maybe letting other countries rob us blind is worse. The US has hardly any factories left. Is that "peace" or is that just losing, slowly?
Open borders can be GREAT, but they can also be a point of vulnerability if we lose control of them
Trade happens because both sides agree and make an exchange. I don't understand how "other countries rob us blind."
They're not robbing us blind. They're taking care of our manufacturing so that we can invest in things like the financial industry, fossil fuels, and AI.
This is great until you're at war (economic or kinetic) with who does your manufacturing.
But for a beautiful moment in time we created a lot of value for shareholders.
> The US has hardly any factories left.
Feel free to start your own factory in US, nobody is stopping you. Just keep in mind that for commoditized products (most consumer stuff, for example), prices are all that matter. "Buy American" is not a product feature.
Some years ago. I learned about a new -ish technology that fascinated me. I started to research ways to get in on the development of this technology: i.e. what sort of opportunities might there be for a startup or small business in the space.
The answer I found was very sobering and mildly depressing. There was no room for developing the technology itself. That had already been done by large companies with the capital and resources to commoditize things early.
Instead, the real opportunities were found in business/management consulting selling the product and tangential things, like having a construction company to help build out infrastructure needed for the technology.
At this point I think technology no longer interests me because it doesn’t have a place for me.
> Maybe letting other countries rob us blind is worse.
I find this argument interesting because the US economy is the largest in the entire world by a fairly wide margin. That the US is being robbed implies it's operating from a position of weakness, which is an absurd idea.
Are other countries with factories really responsible for US companies outsourcing manufacturing to them? Do you want cheap goods or do you want your fellow Americans paid pennies?
Who exactly is robbing you blind? Could it be your own billionaire class?
There's never been a war the US has chosen not to start.
It also seems to ignore the companies and individuals that got rich because they chose to move jobs overseas.
Totally, that is a great and valid add