Posted on 12/29/2013 7:28:10 AM PST by Red in Blue PA
No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing its inspection Laws: and the net Produce of all Duties and Imposts, laid by any State on Imports or Exports, shall be for the Use of the Treasury of the United States; and all such Laws shall be subject to the Revision and Controul of the Congress.
Article I, Section 10, Clause 2
Fixed.
Thank you, Capt. Obvious. So what might cause GE to locate from one State to another?
“Tarrifs are US job killers.”
You are correct. This should be clear to anyone who has studied the consequences of the 900+ Smoot-Hawley tariffs in the early 1930s when the only unemployment insurance for the farmers in this nation was the food they had in their root cellar.
If people would look at the economy, not as the amount of money in the economy, but as the amount of economic ACTIVITY that is taking place, the effect of a tariff on economic health becomes a bit easier to understand. A tariff reduces economic activity. Yes, it makes a competitor’s product more expensive, seemingly making your product more attractive. However, your product costs the same amount and unless that product is a necessity, it is still just as costly as when your customer preferred the cheaper import version. If your product IS a necessity, the customer now has less money to spend on other products. The result is lowered overall economic activity and lowered general economic health. Tariffs reduce economic activity as taxation is destructive of non-gov’t economic activity.
Tariffs are (economic) system constraints, they do not increase the system’s size or performance. Tariffs do not open the way for growth in the economic system.
It certainly HAD NOTHING TO DO WITH TARIFFS.
The Smoot Hawley myth(Free Trader scare tactic) has been perpetrated as a cause celeb for promoting free trade. In reality Smoot Hawley had little or no effect on the Great Depression, neither lengthening it or making it deeper.
Why? because trade of all kind was only 5% of GDP in thirties. We made our own stuff back then.
Well, that’s not necessarily true. If this GE operation was fat, bloated, and inefficient due to the taxpayer subsidies (tariffs) you admire, it could have limped-along a little while longer.
If the person cannot afford a manufactured good then they don't buy it. There is still money to spend on other things. Very few manufactured goods are necessities. Maybe a refrigerator is one.
If a US company off shores its production and a 10% tariff decreases demand by 10% then the factory workers in the foreign country get laid off. This has little or no effect on the US economy.
Reducing and eliminating income taxes will stimulate the economy and increase economic freedom. Those income taxes will be offset by tariff income. A good thing.
Tariffs have nothing to do with interstate commerce. NOTHING. I think you've been drinking....
Herein lies the fallacy. If the person can afford a good, but it is more expensive due to the tariff, then that portion of his income that is "taken away" by the tariff, by definition, cannot be spent on another good.
And don't get me started on products whose additional tariff cost is hidden because the tariff applies to a component.
Try to work on the first sentence of my #31. You’ve never struck me as smart enough to understand the second.
Good luck with all that.
Imported Widget A sells for $100 pre tariff. Post tariff it costs $110. Demand pre tariff was 1,000,000 units per year. Demand post tariff is 900,000. So 100,000 Widget consumers are priced out. 100,000 DIDN'T spend 100,000 X 110 = $ 11,000,000 on Widgets offsetting the increase in price for those staying in the Widget market. Those priced out of the Widget market; that money stayed in the USA, hopefully they spent it on something else or save it.
Also, the factory in China needs to only produce 900,000 widgets forcing layoffs and social problems over THERE for once, he he.
The net effect on the income taxpayer is his/her burden was reduced by 900,000 widget buyers paying a $10 tariff = $9,000,000.
You forgot ONE THING TOO. If you make Widget A a consumer electronic item i.e. flat screen TV, then there ARE NO MORE DOMESTIC manufactures of consequence left in the USA. If a 10% tariff stimulates on shoring then all the better.
Fort Edward and Hudson Falls are already some depressed towns, this isn’t going to help them at all.
It’s a teachable-moment, I’m in the area monthly, I’ll try to curtail my “told ya’ so” demeanor :)
And I’ll note your use of the term, “if.” Sorry, buddy . . . I don’t trust the federal government to set our industrial policy. It’s kinda’ funny—conservatives used to want to get government out of the way—you want it calling the shots.
I don't like your friends in the ChiCom government calling the economic shots in the USA. Back at ya.
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