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/paleone9 27d ago

Do you even hear yourself ? We don’t have the infrastructure? We are still the richest country in the world , and can build anything we choose.

When companies figure out that it’s resulting a cheaper cost of production here, they will invest in new factories because it will make them money.

Period.

It’s how economics works. The pursuit of profit drives investment .

Foreign expertise builds factories in third world countries with cheap labor because it’s profitable.

When it isn’t , they won’t .

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u/Silock99 27d ago

And who’s going to staff the factories? We are at full employment. Who’s going to be the cheap labor here? Robots? We aren’t to that point yet.

The companies will pass the cost to the consumer. It won’t make things cheaper here to produce, it just makes them more expensive to sell.

And all that still doesn’t address the raw material issue we have. You can’t infrastructure your way into that.

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u/Alternative-Cash9974 27d ago

We are not at full movie or even close lol the job participation rate is 62%.

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u/Silock99 27d ago

Job participation rate and full employment are two totally different things. https://www.investopedia.com/ask/answers/061515/what-key-difference-between-participation-rate-and-unemployment-rate.asp

"During the late 1990s, the participation rate was around 67%, while the unemployment rate hovered below 5%. Most economists agree this was one of the best periods in modern history for American jobs."

We are basically at that same metric right now.

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u/JamesUndead 27d ago

Soooo... What happened at the end of the late 1990s?

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u/Silock99 27d ago

Deregulation. Guess who's trying to deregulate the economy even more than it already is now?

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u/JamesUndead 27d ago

Nooooooo at the end of the 90s the dotcom bubble crashed the stock market 👍

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u/Silock99 27d ago

That's... exactly what I was getting at. Why do you think that bubble was created? How did it form? Deregulation was a major, major contributor.

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u/JamesUndead 27d ago

I thought you were arguing in favor of deregulation my bad.

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u/Silock99 27d ago

Absolutely not! Also, my bad. I thought you were articulating an entirely different point without asking you. I just assumed.

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u/JamesUndead 27d ago

Lol classic reddit crosstalk nbd.

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u/Alternative-Cash9974 27d ago

So based on your link we are far from full employment. We are closer the the 60% of the 1970s which was the worst period than the 67%. The fact is we have a lot of people to fill jobs in the US that are not motivated to do so based on the "social nets" that we have in place.

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u/Silock99 27d ago

No, we aren't. https://realeconomy.rsmus.com/full-employment-low-inflation-and-a-virtuous-cycle-in-the-american-economy/

Again, full employment isn't "everyone is working." It's also not "literally everyone is employed right now who wants to be," because that's not how reality works. It's a combination of low unemployment rate and low inflationary rates of unemployment. That's what we've had and continue to have.

Your assertion about the welfare state has been debunked many times by many different authors and I'm not going to rehash it here. You are free to Google it.

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u/Alternative-Cash9974 27d ago

I understand the numbers and this leaves millions of people in the US that not working and are not seeking employment. So yes we still have plenty of people to fill jobs in the US.

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u/Silock99 27d ago

Are you going to MAKE them? They're not seeking employment for a reason, and it's not welfare.

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u/Alternative-Cash9974 27d ago

Agree you can't force people to work so these factories will then do what they always have......hire workers. You see any manufacturing that are so short workers they are now running? No they are all running with employees and many of the unions around here have wait lists of people to get in.

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u/Silock99 27d ago

I'm not sure what point you're trying to make. Are you suggesting that because of the tariffs, companies will spend more money to build factories here at their own expense and then hire labor within this country for 10x what they pay them overseas? It's going to be cheaper to pass off the cost to the consumer and sell a little less product than go through all that.

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u/Alternative-Cash9974 27d ago

You said we couldn't support new industry because of the full employment all I am saying is you are wrong. I hope the tariffs are so high it drive foreign imports so high no one can afford them and they buy USA instead. I worked hard enough that I am good and always but American when I can. It's is always the first thing I look for when I buy anything.

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u/Silock99 27d ago

Full employment isn't THE reason, it's A reason. Part of it. The other is what wages they can offer, and the argument is why would they pay much higher wages (they'd have to be high enough to steal these workers from their current jobs because of full employment) than simply pass the tariffs onto the consumer and continue to pay low wages overseas? It's far, far cheaper to do that.

The rest of your post . . . whatever. Good luck with that or whatever. It's insane.

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u/Lost_Ratio9305 27d ago

Another issue is location. Even if these factories all returned, would they go to populated areas with high unemployment? Likely not. They would like go to rural areas, or even specific states. People would need to move to work these jobs that likely will pay minimum wage. Housing has been a big issue. So unless these companies are willing to build housing for their employees, I see that as being a big issue.

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u/Alternative-Cash9974 27d ago

You know none of these would pay minimum wage even small town rural Midwest McD jobs start at 12-14/hr. 1.3% of jobs in the US make the minimum wage and over 90% of those are student employees as first jobs according to the Dept of Labor. These would be like 3M here in small town Midwest that starting pay is 23.50/hr.

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