Tariffs

[Marco]

If democrats grab congress the US can have the executive force trade balance and congress run an expansionist policy relatively soon though.

Um. Could you reword that to make it clearer?

US president can unilaterally impose tariffs, but congress determines the budget.

A democratic majority congress could make sure that the economic disruption does not cause mass unemployment and keep the ability for the masses to pay for necessities (housing, food, energy, healthcare). Congress can make sure the "masses got a piece of the pie" while Trump forces trade balance.

[tggzzz]

There are only reasonable people and extremists.  I am just as skeptical of utopians as I am of authoritarians.
Both insist they know how you should behave.

If you think it was calm in the US after WW2, then clearly you don't remember the 1960s!

I lived thru the 60s and remember well the "race" riots of 1967, Chicago and the fake hard hat protest organized by Johnson. 

I was referring to 1946 to 1962 when the youing adult population had enough of violence from WWII.

The immediate post WW2 period (1946-62) in the US was dominated by the the cold war and McCarthyism. Both were extremely chilling for people of any age.

[watchmaker]

As I said, RELATIVE calm.  If you would recall, I already noted that the USA has been in constant simmering or overboiling turmoil for its entire history.  Simmering is relative calm.

My family settled the Hudson Valley in 1640 (he was stone mason who had to get out of town after his bridge failed).  During the Revolution (first US Civil War) 1/2 the family were loyalists and 1/2 were revolutionaries.  It depended on whether you were makingmoney with the Crown or if you wanted the limits on expansion imposed by the Crown removed.  They burned each other out and brothers tarred and feathered brothers. 

The ambiguity of the Hudson Valley is a significant reason Washington wanted a strong garrison there.

Final result, I have family in Halifax N.S.

The point is there has always been an undercurrent of economic disparity and angst that all the USA k-12 textbooks ignore.  This winds up creating unrealistic expectations.  Even my schooling in Newburgh NY, (the nexus of the 18th Cent Civil War) ignored the full story.  Had to find it starting with family genealogy. 

I see no value in a semantic argument over this.

[tggzzz]

The point is there has always been an undercurrent of economic disparity and angst that all the USA k-12 textbooks ignore.  This winds up creating unrealistic expectations.  Even my schooling in Newburgh NY, (the nexus of the 18th Cent Civil War) ignored the full story.  Had to find it starting with family genealogy. 

I see no value in a semantic argument over this.

Interesting observations, and I agree about semantic argument.

The history taught in schools has always been the "received wisdom" based on whatever is perceived to have been the causes that lead to the current power structure. Or, in some cases, the political desire to set radical social agendas

I think the current expectations are "unrealistic" for reasons other than that. Thomas Piketty has interesting observations based on the historical record, https://pluralistic.net/2025/02/18/pikettys-productivity/

(For the avoidance of doubt, I certainly don't agree with all Doctorow writes, but he does read widely and synthesises some interesting conclusions. For example he coined the word of the year "enshittification" together with a cogent definition of what it means and how it arises)

[MT]

Several states  Alaska, California, Texas, Louisiana, Florida, and New Hampshire. have been talking about "secession" BEFORE zio Don became pres the first time and more talked about it during zio Biden.
6 horse men.

zio Trump's tariff formula are ridiculous says Bloomberg
https://www.youtube.com/shorts/KmVBfI4_6a4?feature=share

[Simon]

There are only reasonable people and extremists.  I am just as skeptical of utopians as I am of authoritarians.
Both insist they know how you should behave.

If you think it was calm in the US after WW2, then clearly you don't remember the 1960s!

I lived thru the 60s and remember well the "race" riots of 1967, Chicago and the fake hard hat protest organized by Johnson. 

I was referring to the calm (which is relative) during 1946 to 1962 when the young adult population had enough of violence from WWII.

Damn, just realized I need to put a warning on my website that I will no longer accept repairs from outside the USA because I ain't paying the import fees.

Import duties are not normally paid on things sent for repair, it's about sales. If someone sends you a broken item for repair, it has 0 commercial value because it is broken and you are certainly not buying it. You may need to make sure people fill out documentation correctly.

[bdunham7]

Import duties are not normally paid on things sent for repair, it's about sales. If someone sends you a broken item for repair, it has 0 commercial value because it is broken and you are certainly not buying it. You may need to make sure people fill out documentation correctly.

Well, there's a "new normal" nowadays and things might get more interesting as they attempt to close loopholes that would allow tariff avoidance.  Turkey, for example, has what I understand to be a blanket prohibition on the reimportation of repaired products.  So if someone in Turkey sends their watch/camera/phono cartridge/etc from Turkey to the US (or wherever) to be repaired, they can't bring it back.  So don't count on your common sense understanding to be what actually happens here.  And now reexporting the repaired item is going to be another headache once the revenge tariffs are implemented.  My guess is that many specialty repair and service providers are just going to retreat to within their national borders if they haven't already. 

[TimFox]

If democrats grab congress the US can have the executive force trade balance and congress run an expansionist policy relatively soon though.

Um. Could you reword that to make it clearer?

US president can unilaterally impose tariffs, but congress determines the budget.

A democratic majority congress could make sure that the economic disruption does not cause mass unemployment and keep the ability for the masses to pay for necessities (housing, food, energy, healthcare). Congress can make sure the "masses got a piece of the pie" while Trump forces trade balance.

The US Constitution gives the power to impose tariffs to the Congress (Article I, Section .
There are statutes now in force, where Congress delegated some tariff power to the President.
The normal reason stated for that delegation was to facilitate treaty negotiations between the US and other countries.
These have been confirmed by different court cases, starting in 1892.
In  Field v Clark  https://supreme.justia.com/cases/federal/us/143/649/  Marshall Field sued the Chicago customs office over whether a tariff on woolen goods was legal (judgment for the defendant).
In recent news, there is a bipartisan effort (not guaranteed to pass) to grant Congress some review of Executive tariff impositions, including prior notice to Congress.

Edit:  question.  Why did the text I entered ("Section 8") get replaced with an emoji?

[watchmaker]

There are only reasonable people and extremists.  I am just as skeptical of utopians as I am of authoritarians.
Both insist they know how you should behave.

If you think it was calm in the US after WW2, then clearly you don't remember the 1960s!

I lived thru the 60s and remember well the "race" riots of 1967, Chicago and the fake hard hat protest organized by Johnson. 

I was referring to the calm (which is relative) during 1946 to 1962 when the young adult population had enough of violence from WWII.

Damn, just realized I need to put a warning on my website that I will no longer accept repairs from outside the USA because I ain't paying the import fees.

Import duties are not normally paid on things sent for repair, it's about sales. If someone sends you a broken item for repair, it has 0 commercial value because it is broken and you are certainly not buying it. You may need to make sure people fill out documentation correctly.

Tell that to my customers in Canada, Italy and the UK who got charged for the insured value and NOT the value added by my repairs.  For the last 15 years I have cautioned them to first talk to Customs, then keep a copy of their export papers and I then include a copy of their papers when I return the item.  They still have arguments.

[tggzzz]

Import duties are not normally paid on things sent for repair, it's about sales. If someone sends you a broken item for repair, it has 0 commercial value because it is broken and you are certainly not buying it. You may need to make sure people fill out documentation correctly.

In that case I'm sure other taxes will apply on the increase in book value, from zero to the repaired value.

[TimFox]

Import duties are not normally paid on things sent for repair, it's about sales. If someone sends you a broken item for repair, it has 0 commercial value because it is broken and you are certainly not buying it. You may need to make sure people fill out documentation correctly.

In that case I'm sure other taxes will apply on the increase in book value, from zero to the repaired value.

In countries using VAT, how is this question handled?

[PlainName]

Edit:  question.  Why did the text I entered ("Section 8") get replaced with an emoji?

8 ) is an ascii emoji which SMF converts to a graphical one. There are many such combinations that can be screwed up like that, but 8.. seems to be particularly prone.

[tggzzz]

Import duties are not normally paid on things sent for repair, it's about sales. If someone sends you a broken item for repair, it has 0 commercial value because it is broken and you are certainly not buying it. You may need to make sure people fill out documentation correctly.

In that case I'm sure other taxes will apply on the increase in book value, from zero to the repaired value.

In countries using VAT, how is this question handled?

Separately Caution: I've never had to be involved in such calculations, but...

VAT was impractical until computerised accounting became the norm, since it applies to every sale. However, VAT registered companies can reclaim the VAT on something they have purchased. The overall effect is that there are vast numbers of VAT-liable transactions most of which neatly cancel out. If there is a chain of sales then VAT is only paid by the final purchaser on the final purchase price. The seller collects the VAT and remits it to the government.

One effect is that if a business sells to businesses and individuals, the prices for the former can be explicitly shown as "exc VAT" and for the latter as "inc VAT". The final checkout bill indicates the VAT inclusive price. There's never the equivalent of something in a shop being marked as $4.99 with $5.xx being shown at the till.

Your next question is "what is VAT payable on", and that can be an entertainingly complex answer. I remember that when VAT was introduced, the rate of VAT depended on whether the UK government of the day deemed an item was a "luxury item" or not. Hence 1uF capacitors that were typically used in TVs attracted VAT, but other 1uF capacitors didn't.

All clear now?

[TimFox]

It is a poor country, that probably cannot afford much imports from the US.
It's major export to the US is diamonds, which are pricey.
In my professional career, I often used extreme cases to evaluate proposed solutions, such as reducing the resistance to zero to see if the theory gave a believable result.

In this case, if the tariffs result in the diamonds all going elsewhere and mutual trade between Lesotho and the US becomes zero, the formula will have been correct as trade balance will have been acheived.

A more important country for trade with the US is Vietnam, which is a major exporter of shoes.
They do have substantial import duties on US goods, but today they offered to reduce that to zero.
Would that result in no trade imbalance, even with continued US import duty?

[tggzzz]

It is a poor country, that probably cannot afford much imports from the US.
It's major export to the US is diamonds, which are pricey.
In my professional career, I often used extreme cases to evaluate proposed solutions, such as reducing the resistance to zero to see if the theory gave a believable result.

In this case, if the tariffs result in the diamonds all going elsewhere and mutual trade between Lesotho and the US becomes zero, the formula will have been correct as trade balance will have been acheived.

A more important country for trade with the US is Vietnam, which is a major exporter of shoes.
They do have substantial import duties on US goods, but today they offered to reduce that to zero.
Would that result in no trade imbalance, even with continued US import duty?

That question seems to be predicated on the idea that the tariffs are defined rationally. They aren't. Shakedowns don't require that the threats and actions are rational.

[TimFox]

I considered that to be a reductio ad absurdum argument against the tariff.

[tggzzz]

I considered that to be a reductio ad absurdum argument against the tariff.

OK. But then the tariffs themselves are absurd(um)

[Marco]

This chart is just wild.

Getting buried in free stuff is only great until the party stops. At the moment the US is likely economically strong enough to force a transition back to trade balance without collapsing, the status quo meant waiting for a defacto bankruptcy and bankruptcies come disastrously sudden.

This likely won't end with Trump. The only problem with Trump is pacing, on the other hand he has to make it irreversible in 4 years so the only people more insane than him can't force things back to the status quo ... mainstream economists.

[incf]

US dollar hegemony and US manufacturing competitiveness/US trade defict are contradictory to each other，you could only keep one. If Trump is trying to have his cake and eat it too, it is doomed to fail

Can you elaborate? I'm interested - I've got gaps in my understanding of this

I've heard that the USD being the only currency allowed for trade allows the US to play financial games. For example exporting it's inflation to other countries. Or writing off/paying debt with inflation.

I've heard China manipulates the value of its currency to make its exports artificially cheap (at some unknown cost - I don't exactly know how they pay for it, but I've often heard they simply don't).

I've also heard that what forces countries to use the USD for trade is the (overt and convert) application of brute force (ie. economic as well as other types of interventions when things don't go their way).

I'm curious if tariffs could reasonably impact this hegemony is any direct fashion in the next decade or two?

There are all sorts of institutions (banks, cartels, etc.) that are heavily invested in the way things are. They pull off many remarkable things practically everywhere - not just in war torn third-world countries.

Perhaps I am not thinking creatively enough. Is the assertion that US exports could never be "cheap enough" unless the US performed the same sort of currency manipulation as China does? Sometimes I get the impression that many economic/trade problems are about "something else" (control?) other than quantity of currency moved or about quantity of "value" provided.

If the US has the power to do so, maybe it might simply force others to buy from US controlled/taxed/tariffed sources regardless of the cost. And if they won't or can't pay enough into US coffers (directly, or indirectly), perhaps they might do something to try to force it to happen anyways. I would be unsurprised if we see a bunch of countries mysteriously start making all sorts of allowances and adopting unexpected policies that ultimately have the effect desired by the US.

edit: Japanese and Chinese stock markets reportedly crashed today with trading temporarily halted on one Japanese derivative. I didn't see that coming.

[Marco]

China simply doesn't spend its taxes but parks it in USD assets, thus suppressing its currency and the value of wages of Chinese. Also it uses subsidies, IP theft, joint venture rules etc etc to take over essential value added industries.

It's mercantilism, but in a different way than Germany, Japan and the Asian tigers before it. Those we're just trying to grow their industry, China tries to actively destroy the essential industrial capability of its trading "partners". China is trying to become autark, while making the west dependent on it ... thus getting complete strategic freedom in it's backyard, where it has a lot of unsettled territorial beef.

[sleemanj]

https://youtu.be/j04IAbWCszg

[vidarr]

The money creators want three classes of people, the slave workers, the managerial class that runs everything, and themselves, that own everything and create the money. The slaves will think the managerial class are the wealthy people that control and run everything, just like people think politicians and low-level millionaires rule the world now. Elon Musk is not the richest man on earth, he is not even close. He is a tool of the money creators and their wealth is beyond trillions. They have so much wealth and power, you don't even know who they are. They are the families that own money creation, like the USA Federal Reserve, that they privately own and control.

The USD is slated for destruction. Americans will be on CBDCs probably by the 30's. The CBDCs have already been rolled out in some places in the USA. CBDCs are the ultimate form of slavery. Freedom will be over. Especially, when you combine that with the soon to be rolled out, health ("vaccine") passports.

The global forced, mass migration of peoples from the third world countries into the first world countries was about many things, but among the top, is the creation of that slave labor class. Think about all of the illegal aliens living in the USA right now. They are not going to be deported. Trump was lying. Those are the people that will be competing for any of the factory jobs they keep talking about and promising, that aren't replaced by automation, robotics, AI, obsolescence, etc. The factory jobs of the past are long gone. There will be no dad that is an engineer at Ford that owns a suburban house and a cottage on Lake Michigan and his wife is a housewife and they have four kids and they can afford to send them all to college. That is gone.

Look at the 15 minute cities popping up all over the world right now. They are the hottest investments. These massive towers look impressive, they are clad in ways that almost look like rich people live there. But, inside, those towers are tiny barracks. Little dormitory rooms. They are smaller than hotel rooms. These are not homes for families. They are barracks for the working slave class. The goal is to relocate all of the people from rural and suburban areas and cram them into the cities. This is exactly what they have done for the past 100+ years and now it is coming to the USA, Canada, EU and the "West" in general.

These tariffs are to further fracture ties between peoples and goods and prosperity. They are destroying the entire system to replace it with this dystopian nightmare. For the money creators, it is their ultimate dream, along with Their human life longevity. I know this because I met the kids of these money creators and kids of the Rockefeller's when I was at Yale. I am friends with these people. But, you don't need to be friends with any of these people to know what they are doing, everything is right out in the open. They publish everything they are going to do before they even do it. They train the managerial class on what their function, duties are, many times every year (like Davos) and much of that is made public. Even if initially private, it always gets leaked eventually. But, it is almost always, 100% wide out, in the open (think Event 201 and the Rockefeller's Scenarios publication(s) ---Operation Lockstep). We knew Covid was coming a year before they released it. Why, because they told us it was. They told the managerial class how to handle it. All we could do was just sit back and watch the masses not just fall for this atrocity, but actively engage in maximizing the human suffering.

One thing is clear, the global population is willing to take massive amounts of pain and suffering, including self induced, solitary confinement, without fighting back. Instead of fighting back, people were committing suicide in epic numbers. It will be easy getting people on to CBDCs, carrying a mandatory, "Health Passport", living in vertical barracks, eating garbage foods ---no, "You will Eat Zee Bugz", and "You will own nothing and be happy", as Klaus Schwab and the World Economic Forum tell us. Further, Treasury Secretary, Scott Bessent, told us the other day that very soon, Americans will have to get used to working a lot harder, a lot more, and get used to not being able to buy as much stuff (that was on an interview with Tucker Carlson (on YouTube and Rumble)).

Addressing the main topic, if you struggle with tariffs, you can do some very clever, very creative solutions with cargo ships, ship to ship transfers, international zones (on land), etc. I've seen billions of dollars in creative transactions take place. It is amazing and unbelievable. It isn't just private companies that do this; entire countries do this to get around tariffs, sanctions, legally shimmy around international laws. I am in the building technology, construction business, not electronics, but if your trade has some good people, they should have at least one journal that talks on this subject and how to deal with it professionally and legally. Some stuff looks so crooked, but it happens to be legal. I am certain that many of these scenarios are set up like this on purpose. Lobbying Loopholes... 

[tonyget]

US dollar hegemony and US manufacturing competitiveness/US trade defict are contradictory to each other，you could only keep one. If Trump is trying to have his cake and eat it too, it is doomed to fail

Can you elaborate? I'm interested - I've got gaps in my understanding of this

Sure

First contradictory — For the US dollar to keep it's principal world trading currency status，there must be adequate amount of dollar circulating around the world，countries must have enough dollar to trade with each other. The principal way for other countries to obtain dollar is by selling goods to the US, and they have to run a trade surplus with the US，so they could accumulate extra dollar to trade with other country. That means the US have to run a constant trade defict，in order to keep the status of the dollar（it is also the reason why China is reluctant to internationalize it's currency）

Second contradictory — If dollar remains it's status，people around the world will always see it as safe asset. So the demand of dollar remains high，especially during turbulence period. This will prop up the value of dollar, which in turn makes US manufacturing uncompetitive. Again，that is the compromise the US made in exchange for dollar hegemony

[Zero999]

Edit:  question.  Why did the text I entered ("Section 8") get replaced with an emoji?

8 ) is an ascii emoji which SMF converts to a graphical one. There are many such combinations that can be screwed up like that, but 8.. seems to be particularly prone.

Fortunately that can easily be disabled.
:)
8)

[JPortici]

Import duties are not normally paid on things sent for repair, it's about sales. If someone sends you a broken item for repair, it has 0 commercial value because it is broken and you are certainly not buying it. You may need to make sure people fill out documentation correctly.

How do you do that? We have import / export offices in some countries (like US, brazil, ..) that refuse to receive/send goods if we declare them with zero value for repair. Tried many times over the years, never found a solution.