Comment by Aeolun
15 hours ago
> Tariff's change this and make it such that domestic producers can produce things at a cost comparable, and ideally less, than other countries.
It’s the opposite. It makes things from other countries more expensive. It doesn’t make things from the US cheaper.
> It’s the opposite. It makes things from other countries more expensive. It doesn’t make things from the US cheaper.
All prices are relative. If something is more expensive then de facto its alternatives are cheaper in comparison.
But price elasticity isn't infinite. A large part of the middle class would be priced out of most modern amenities if these would be produced domestically. Import substitution is one of these things that sounds nice in theory but tend to be highly damaging in practice.
This isn't necessarily true. A big factor when production comes back home is that so do the jobs that come along with it and that has a huge ripple effect on the economy that's difficult to evaluate, other than it being a very good thing.
1 reply →
> A large part of the middle class would be priced out of most modern amenities if these would be produced domestically.
Who said everybody would get to keep buying as much cheaply made foreign crap as before? From an environmental perspective that's arguably a win as well. Reducing both pollution from construction and transport.
1 reply →
If something (e.g. imported metal) is more expensive then alternatives (e.g. domestically refined metals) will get price increases too.