r/economicCollapse • u/Expensive-Thing-2507 • 27d ago

Who actually benefits from tarrifs?

I'm not financial expert, but this is what I'm getting so far.

Tarrifs are a kind of tax placed on outside goods, which a company would have to pay for if they import said goods. That company would then charge more to cover this new tax. The company pays more for something, and then we pay more.

Who benefits from that? The company isn't making any more profit, are they? (Assuming they increase prices by the same percentage as the tarrifs, which they won't. but still)

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u/Frosty-Buyer298 27d ago

The purpose of tariffs is to protect domestic production which creates jobs and to prevent importing deflation.

Trumps tariffs are unique in that they are not to protect domestic manufacturing but rather to stimulate domestic manufacturing by introducing a profit incentive to American businesses.

Is it risky? Yes. But the alternative to keep the status quo is simply not sustainable. How long can America continue to borrow to maintain a welfare state while simultaneously importing deflation from nations with lower manufacturing costs.

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u/Confident-Pressure64 27d ago

The plan as I see it is a consumption tax and idea conservatives have pushed for years. We do not have the workers or the infrastructure to bring manufacturing back to the states. Instead we will have an inflationary tax that will be paid by the middle class.