Tariffs and Potential Inflation

[Flatbrimmer]

"via" ???

view….

 

[asgmiami1]

Most economic analysis I've read concluded that broad import tariffs can increase inflation.

There are 2 potential reasons:
1) Most goods consumers purchase in Lowes, Home Depot, Walmart, Target, Amazon, etc. are imported.
Tariffs on these goods would be passed from the US importer to the consumer.
Historically tariffs have effectively been a tax on consumers.

2) As tariffs increase the cost of imported goods, domestic producers can profit more by raising their
prices to slightly below those of imports. Most US companies would likely choose increased profits.

How could substantial tariffs not increase inflation?

A dozen macroeconomic estimates have taken different approaches
to analyzing Trump’s proposed tariffs, from estimating the fall in
aggregate demand arising from the tax hikes to using various trade models
to the Tax Foundation estimating the effects of the tax increase on labor.
All studies consistently find that Trump’s proposed tariffs would have a negative impact on the United States economy.
source: https://taxfoundation.org/blog/trump-tariffs-impact-economy/

Buy American.

 

[SAJ-99]

"via" ???

Agree that I think he meant "view". And I think that is downplaying it. There is no economic model that say that tariffs on imports don't increases prices for buyers. Maybe there are one that gets a different result that involves taking psychedelics before running the model.

Buy American.

Sure, I would love to. I think everyone would. But at what price and do we want jobs making things like socks and underwear? Our manufacturing has turned to larger, more technical items - planes (Boeing), heavy equipment (Cat and Deere), Semiconductors, Defense (Lockheed), etc. Even in those cases the race for profit has caused problems. I struggle with what people want to see in the "Buy American" demand.