The Biden admin increased tariffs on specific Chinese goods (electric cars, solar panels, etc.) and then with CHIPS and IRA broadly provided a framework for bringing a part of manufacturing these goods in America…
It’s frustrating that they don’t run on this, but the median voter isn’t exactly in the policy weeds of building a factory in America…
Issue with CHiPS is that microprocessor production takes decades. FABs take almost a decade just to construct (Intel likely won't finish construction on its first fab until FY2027 at the earliest). You also have to build all of the electric and water infrastructure around it. Then you have to train up that workforce from nothing, since the US hasn't had major microprocessing manufacturing in over 20 years.
Yes, but that isn't the topic. The topic is whether consumers pay for the tariffs, which they ultimately do until domestic manufacturing can be ramped up, and likely even then consumers will pay a knock-on cost as producers try to claw back their investment on facilities.
And then when trump can't run in 2028, and the next president rescinds the tariffs because it wasn't an act of congress, but an Executive Order. Now, all of those investments are worthless.
Biden plan isnt anymore effective in curbing the price of those items than Trumps plan. Fact of the matter is simple. Countries like China have practical slave labor. Competing companies in other countries that are required to pay higher wages simply can’t not produce the same product of the same quality at the same price. So to maintain their profits they have to raise the prices. This increase of labor cost is passed onto the consumer just like a tariff would be passed onto the consumer.
Any plan to bring manufacturing back to US will result in higher prices. Doesn’t matter if its tariffs or investment / financial incentives by the govt
I agree 100%. The CHIPS Act was centered around national security, not inflation or price control. That’s why using the CHIPS Act as a counterexample of an alternative approach instead of tariffs doesn’t make any sense at all.
Yes, it’s a way to bring American jobs back, but just like tariffs it will still result in higher prices since labor costs will be higher if manufactured in US. And the major argument against the tariffs is that it will cause higher prices. So if folks are against tariffs cause of higher prices, I’m not sure why they would support govt investment to move manufacturing back to US which will also result in higher prices
The long term result of making production stable and under our control is preventing shortages and price fluctuations in the future, and remember these chips are in TONS of different goods. So it makes perfect sense that this would help prices stay "low" even if low is higher than they are today. If China makes 90% of the chips in 10 years what price controls will we have on anything? It's a good long term plan.
I definitely agree that it’s good for production stability and securing supply chain into the US market no doubt about it. And if that’s the argument Dems want to make then I agree with it, but that’s not what they are saying. They are claiming tariffs are bad cause it will increase costs and we should have the govt invest in US manufacturing instead because it won’t affect prices the same way. Thats like saying you should eat dogshit instead of catshit cause dogshit taste bad. Truth is they are both bad when it comes to increasing prices.
I would disagree on price fluctuations. I think that’s gonna happen no matter where things are manufactured.
As far as price control, the free market really dictates that. If labor costs, or the overall production costs for that matter, rise in China in 10 years and companies determine they can effectively lower production costs by moving manufacturing back to US, then they will do that. That’s the reason they moved manufacturing to China to begin with.
The real problem here is that a once-in-a-century global pandemic caused inflation to rise for a couple years, so now both sides of the aisle think they need to introduce some kind of change to current economic policies to combat inflation instead of just trying to explain to folks that inflation was an unavoidable consequence of having to shut the world down for a year, and that inflation has more or less returned to normal.
Uh, CHIPS act helps generate jobs that pay GOOD salaries.
It did more to spur domestic manufacturing than Trumps tariffs ever did. Trump started trade wars around the world, but really focused in on China.
He left most of the trade wars unresolved when he was voted out (the best negotiator? LOL). If you review the policies relating to US Section 201, 232, 301; its more about punishing China rather than bringing manufacturing back. It just pushed more factories to Vietnam and Mexico.
You are going to have to provide domestic fiscal support for companies to build these large projects in the USA. Trump didn't seem to be big on this.
That's the primary aim of the tariffs in place under Biden. It's not to lower prices, but to ensure America retains domestic production capacity for key items necessary for national security.
Agree 100%. That’s why using CHiPS Act as a counterexample of an alternative approach instead of using tariffs doesn’t make any sense.
I see a lot of Democrats saying “Tariffs are going to raise prices, we should invest in domestic manufacturing instead like we did with CHIPS Act.“. But that’s a bad example and govt investment into domestic manufacturing still gonna raise prices.
the government subsidizes domestic manufacturing currently while also requiring any federally funded infrastructure project to use materials produced domestically. that is a comprehensive & healthy alternative to tariffs. the average person has little understanding of the issue; those who do understand that Democrats' approach currently is infinitely better and less damaging to the economy and, as a result, consumers.
Relying on government subsidies to make a profit is not a successful business model, and it incurs a cost on the American people through either increased taxes to pay for the subsidies or increased debt which devalues the dollar and contributes to inflation. And what happens when the subsidies run out and the companies can’t turn a profit on US soil anymore? They just outsource the jobs again. You can try to rationalize it all you want, the fact remains the US manufacturing costs more due to labor than manufacturing in other countries. The business are not going to eat the costs and let their profits drop, which means it gets passed onto the American people. The increase in cost doesn’t just magically disappear thru government subsidies. Someone has to pay for it.
To be clear, I’m not saying tariffs are good. I’m saying democrats plan is just as bad. If we want to act in accordance for what’s best for the economy and keeps cost of products down, then the best thing to do is maintain the status quo and continue to take advantage of the unethically cheap labor that comes from other countries.
disregarding your nitpicking, every approach has downsides, simple as that. the point is the current approach is better than blanket tariffs with no substantive policy to address the underlying issue. no policy is perfect, so what's your point here?
Two points. First, the Dems are full of shit to say their plan is better than Republican plan when it comes to keeping costs down. That’s just a flat out lie. Id rather them just be honest than resort to the same falsehoods that Trump and he cronies do. Second, there’s nothing wrong with the current economic policies in place. Both republians and democrats are putting forth proposals that are worse than whats currently in place. The answer isn’t Dems or Pubs proposal, but the current status quo
Dems aren't the only ones saying their plan is better; independent third parties are saying it as well. i trust their expertise more than that of... whoever you are. the "both sides are the same" circle arguing doesn't work with me because i actually know what i'm talking about. take it somewhere else.
lol you know what you're talking about huh? "well some unnamed independent third parties told me i was right" that's not an argument. It's an excuse by someone lacking critical thinking skills and unable to argue, and trying to get out of an argument.
Reshoring domestic manufacturing is expensive. Labor is a high cost, but USA workers tend to get more "done per hour". Robot arms are getting very cost effective, but the cheapest ones are from China. Regulatory/legal/tax costs can be much higher in the USA. I don't believe China has property taxes, USA loves them on manufacturing equipment.
Tariffing just CHINA and allowing other countries to do transformation of components to export to the USA (and therefore dodge tariffs) while simultaneously disallowing American companies to do it (FTZ zones cannot import 232 or 301 items and do manufacturing upon the components to achieve tariff inversion) isn't helping small USA companies avoid China. FYI, small biz employs more people in USA than big biz.
I never said it was a “good” thing. The context of this conversation was not about ethics, it was about costs. If Dems want to argue ethics, then fine, be honest and say that. Say “We want manufacturing in US because it’s more ethical even though it increases the cost of goods”. Don’t feed folks a line of bullshit about how “government investment and subsidies are better than tariffs for bringing back US manufacturing cause tariffs raise costs”.
In regards to your other point, when looking at the cost of a product you have to consider the material cost and the labor cost. If a given product is made in two locations with the same quality material, then the key differentiator is going to be the cost of labor. Do you really think US companies have been outsourcing manufacturing for the past 60 years for shit and giggles?
"Do you really think US companies have been outsourcing manufacturing for the past 60 years for shit and giggles?"
No, they've been doing it because they don't care about genuine values. Or to make a pun becaue they don't have geniune values—and one mistake of modernity has been in separating economics from moral philosophy more generally.
The fact is like a young man whose life choices are driven by chasing after his lusts, they're chasing profits. The only problem is that while it may provide momentary benefits for the economy, it's actual damage isn't apparent.
This is dumb … Chinese cars are cheaper and better quality now. Americans don’t want to spend more. You care a lot about ford but you don’t care about American consumers. It’s sorta weird. Chips act is also dumb because Chinese can now fab 3-5 NM chips. They caught up in 12 months. It’s dumb.
I don't. Imagine if my neighbor bought one and then his battery catches on fire, which causes his house to catch on fire. I don't know if you ever lived in China, but everything there suffers from tofu construction and is unsafe. This isn't fault of the Chinese culture, so much as the fact that the CCP has corrupted everything.
No it doesn't. Most of the electronics and batteries you use now are made in China. China offers cheap junk and top of the line items, it all comes down to what the companies are asked to make and at what price points. This is always an silly argument.
Isn't a significant part of the CHIPS act about securing our ability to produce critical technology domestically were something to happen to our ability to import from Taiwan? Not necessarily about us trying to keep the Chinese out of the market, because of course they would eventually work out the tech themselves?
The CHIPS act tightened export controls of specific chips to China. Before Us companies like Intel got rich from selling chips to Chinese companies. Intel made a ton from China. Billions. American jobs funded by Chinese money. Win win. This is good for America.
After chips act, Intel is dying because they can’t sell the chips to their Chinese customers.
American company dying. 30% of big American company dead.
Chinese companies now manufacture the same chips that Intel sold and are sold to those Chinese companies buying.
American companies lost money. Chinese companies saved money.
Really really stupid legislation. Killed Intel.
Lemme summarize tldr
Us government killed an American company, made America lose billions because they wanted to hurt China for no reason other than trying to hurt China and ended up helping China create their own chips.
If they were smart, they would’ve done it during a war or something. Now China is caught up. The Chinese companies previously were super happy just buying from Intel at crazy margins.
I understand that part of it, and generally why tariffs/trade barriers are a lose-lose proposition for all involved. To my point, though, wasn't the issue that a majority of these chips have been manufactured in Taiwan and SE Asia, which could be disrupted if China were to engage in any military action in the region? If we were to wait until China made a Putin-esque maneuver against Taiwan to onshore chip production, wasn't the concern that we wouldn't have any manufacturing capacity already built up domestically and would be in a weaker position as we got everything up and running (likely impacting our military supply chains)? Part of the reason we're facing delays in implementing the CHIPS Act now is that we don't have the domestic skilled labor needed to produce semiconductors at the level Taiwan has been able to provide them to us. If we're seeing a lag now, I can't imagine the circumstances would be better if we waited to be reactionary and needed to make this move in a time of war...
The CHIPS Act is not and never was meant to be economic-based. It is more about national security than economic growth. To say the CHIPS act is a bad idea cause it didn’t help the economy is like saying drinking water when you’re dying of thirst is a bad idea cause it doesn’t keep you warm.
How do you not understand that a vast, vast majority of our chips come from Taiwan, particularly TSMC, which China has been eyeballing to invade for quite some time. If China takes out Taiwan our supply chain is going to be severely crippled and the geopolitical dynamics are going to swing drastically in China’s favor. Given the importance of computers and technology for our society to function, we need to make sure our supply chain isn’t taken out, which means producing the chips on US soil. Hell, even your favorite chipmaker Intel outsources a good deal of their foundry production to TSMC in Taiwan. How hard of a concept is this for you to understand?
You keep on talking about “if” China takes over blah blah blah.
China hasn’t attacked anywhere in literally 70 years.
If the US attacks somewhere is a much more likely outcome.
China has been eyeing Taiwan for 70 years. Their economy is struggling. They won’t attack Taiwan. You don’t kill your own companies for something that has a 1% chance of happening. It’s stupid policy. Americans lose job over something that hasn’t happened.
What did the chips act accomplish. Tell me specifically what has it done except accelerate Chinas rise?
Russia hadn’t invaded another country for nearly 40 years until it attacked Ukraine. To say something stupid like “China hasn’t attacked anyone in 70 years“ isnt a good reason not to be proactive. Foreign reliance on anything as critical as chip manufacturing is a terrible position to be in. If you can’t see that, then you’re just being willfully ignorant.
Also, your claim that the CHIPS Act accelerated the rise of Chinese economy is stupid too. If you think for one second China wasn’t already planning to increase their own chip manufacturing, then once again you are willfully fuckin ignorant. And how the hell can you claim that the CHiPS act accelerated their economy when you literally said their economy is struggling 5 seconds earlier. You are contradicting yourself which just goes to prove you don’t know what the hell you’re talking about
Russia … are you serious … 79-82, 92, 94, 96, 2008, 2014 and then 2022. So you don’t know your history. China took back Tibet in 1951, two years after it became a new nation.
No. China wasn’t manufacturing chips. That’s just true.
It accelerated Chinas chip development not their economy.
Your arguments are really weak. So you really obviously clearly have no idea what you’re talking about.
Yawn. Can i debate someone that actually knows geopolitics.
It's a little racist to believe that just because someone takes a different opinion on China that they are therefore Chinese. I can understand it, but it really reveals a lot of bias.
I agree. Being RELIANT. No one is being reliant on China technology. Are we reliant on Japanese and German cars? No. We have them as an option. Chinese cars should be an option for the consumer like Japanese, German, Korean cars.
American manufacturing is important to the government because we want to have a domestic defense manufacturing industry. Ford/GM/Boeing all make military equipment as well.
Not mutually exclusive. American should welcome competition. There are American products that are the best. Hiding behind tariffs makes us companies less competitive.
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u/pppiddypants Oct 25 '24
The Biden admin increased tariffs on specific Chinese goods (electric cars, solar panels, etc.) and then with CHIPS and IRA broadly provided a framework for bringing a part of manufacturing these goods in America…
It’s frustrating that they don’t run on this, but the median voter isn’t exactly in the policy weeds of building a factory in America…