Comment by BobbyJo
18 hours ago
> I'd call the first part utterly counter-productive and stupid.
I don't think there is a better method of onshoring than tariffs, personally. You change the cost of offshoring and see what the market does. IMO its the least complicated and most capital efficient way of doing it. That being said, changing the tariffs every week kills most of the benefit of that simplicity.
> The fact that he just signed a bill utterly decimating the last important work done in this country
What work is that?
Tariffs are a demand-side change, there's also subsidies for supply-side.
But the manner in which they were done shows a lack of planning. Whatever it is you want to on-shore (or prevent from being off-shored), tariff that, but not the economic inputs to make that.
Want to make more EVs domestically? Don't tariff electric motors. Want to make more electric motors domestically? Don't tariff bolts, insulated wire, or high performance permanent magnets. Want to make more high performance permanent magnets domestically? Don't tariff neodymium.
If you tariff everything, you're putting off manufacturing that depends on anything.
> Tariffs are a demand-side change, there's also subsidies for supply-side.
Yes, but subsidies are typically more complex to implement than tariffs. Imports are already controlled via customs, so you're piggybacking off existing oversight. New subsidies require entirely new oversight.
> Whatever it is you want to on-shore (or prevent from being off-shored), tariff that, but not the economic inputs to make that.
Why? Its impossible to account for second order effects beforehand IMO. I think its way better just to put up flat tariff, see what's working and what isn't and adjust from there.
I don't think this admin is doing tariffs correctly, but I welcome the added incentive for domestic manufacturing and mining.