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Cake day: July 1st, 2023
  • MelastSB@sh.itjust.workstoPolitics Unfiltered@sh.itjust.works•Why are tariffs bad?
    9·
    2 months ago

    You’re correct, tariffs can protect (as in protectionism) the local economy. The only downside is to consumers, as they no longer have the possibility to buy cheaper foreign goods.

    But what if there is no local production for the goods being tariffed (not sure that’s a word)? The government collects a bit of money and the price rises for two reasons: to pass the tariff to the consumer and because of the increased rarity/scarcity, as foreign traders will tend to sell their goods elsewhere.

    Now I’m no expert, but I’m pretty sure that a lot of stuff is no longer locally produced in the US. Tariffs could lead (in the long term) to a re-industrialisation of the country, creating jobs, reducing pollution (reduced cargo transport, better regulations if Trump doesn’t gut them), etc. But in the short term, it will be price rise galore.