Either Buy American and put your fellow countrymen to work or either you or China is going to have to pay the tariff. Tariffs are like taxes.
The end-user pays the tariff. Just as the end-user pays the tax.
In order to "put our fellow countryman to workj", he must produce a product of similar quality at a lower price, or of higher quality at the same price.
Until then, a tariff is simply another tax on the American consumer.
"Tariffs are like taxes. The end-user pays the tariff. Just as the end-user pays the tax."No, tariffs are not like taxes because only the imports are taxed. Therefore a couple of things can happen.
- Production can move here and avoid the tariff altogether.
- If production doesn't move here, then the tariff has to be paid, but that can come from either a price rise in price to the consumer or a reduction in profits for the producer.
- If China doesn't absorb the tariff, then the price to the end user will rise and the American Consumer will pay and the American government will benefit.
- If China does absorb the tariff to keep production from moving here and to keep it's own people employed, then that's a direct hit to the Chinese government which taxes it's firms with a 90% tax. Chinese government loses, American government wins.
The best result though, is that production moves back to the U.S. because then Americans are earning salaries, paying income taxes, and spending money in the American market. And none of that is happening, when Americans are unemployed.