Myth. You don't know that. Labor is only 7-8% of the retail price of US manufactured goods 3% for 3rd world crap. So a small tariff really would level the playing field.
To central va:
You wrote “Labor is only 7-8% of the retail price of US manufactured goods 3% for 3rd world crap. So a small tariff really would level the playing field.”
Have you ever worked for a manufacturing company? You have absolutely no idea how decisions are made at a manufacturer.
Let me illustrate. Picture something simple, say, a washing machine. It’s made of sheet steel, powdercoat/paint, gaskets, power cord, dials, switches, timers, motor, water pump, and injection molded plastic parts.
Each of these parts has a different ratio between labor and materials. The washing machine manufacturer decides first what parts to make himself, and what parts to purchase, and then decides which of the purchased parts to buy domestically and which ones to buy internationally.
Many issues play a role in each of these decisions. the vendor’s piece price... the vendor’s lead time... the transit time and transportation cost... quality... how good we are at ordering ahead (that is, how often will we need to rush an order).
Your mention of an average labor rate in the manufacture of the finished product - which is hogwash, by the way - doesn’t play a role in this because the decision on each individual part is made independently of the others.
Every one that we outsource to a foreign country causes a loss of jobs here. So yes, it all matters...
But it’s also important to look at each individual part. A lot of these imported parts are half the price, or a quarter the price, or a tenth the price, of a similar part made in the USA.
Why? A mix of reasons... including cheap foreign labor, yes, but also including such things as illegal foreign subsidies (known to economists as ‘dumping’) and currency manipulation.
In addition, lots of crooked foreign companies will bid low on a part just so that they can get the ability to make that part - the real, legitimate approved part - for the US buyer... so that they can make twice as many (without telling their client) and sell them under their own brand as ‘knockoffs’ but at the same high quality.
Ever look at a fake Coach purse, for example, and say ‘my gosh, that looks just as good as the real one!’ well, there’s a reason for that. A lot of ‘fakes’ are made by the very same company, of the very same material, ripping off their own customer.
They don’t teach about these kinds of risks in business school, so buyers don’t realize what they’re getting into by providing their dies and molds to Chinese vendors. I think every businessman would be better off watching the Rodney Dangerfield movie, Back to School, fifty times, rather than going to business school... But anyway...
The point is, tariffs CAN sometimes make a difference, but not often. Businesses need to become independent of foreign countries for components, not because of a five or ten percent duty rate (we’ve seen that even President Trump’s 25% tariff stopped relatively few companies from sourcing from China)... but because they start seeing the big picture and regain some patriotism.
Only TCO and an understanding of history will save us.