How wrong can they be? (Sales up sharply; Chinese pass ZERO costs of tariffs on to US consumers.)

2019-06-14 | Dangus

[dangus]

The import price index FELL 0.3% last month. It's down 1.5% for the year. That didn't stop NPR (and many other news sources) from doing an extended story about how tariffs on Chinese goods are hurting the poor. Even the Drudge Report had screaming headlines about how rising costs from the tariffs had ALREADY (just weeks in) cost U.S. consumers more than they'd made from the Trump tax cuts.

American Public Media host Kai Ryssdall (who sounds to me exactly like the guy from the old "You Don't Know Jack" video game), hosts "The Market Report." He has spent nearly every single episode of his daily radio show discussing how the tariffs would be deadly for the economy. And every time someone mentions tariffs, he has to interject, "taxes... on the American consumer." There was no acknowledgment of this economic news. Or any economic benefit to the fact that the Chinese could end up paying enough in new taxes to cover the entire costs of the Trump tax cuts.

There's also been endless drumbeat of negative economic news, including on Drudge. But sales were up sharply last month. Not only that, but last month's data was revised to show healthy growth instead of a decline. Again: no mention. The Atlanta Fed was impressed enough that it increased its prediction for 2nd Quarter economic growth to 2.1%. Look for further boosts.

NBC news's business page was too busy STILL covering "Jack Dorsey and more than 170 CEOs sign letter calling abortion bans 'bad for business'" Forget that Jack Dorsey did NOT identify himself as CEO of Twitter, signaling Twitter's refusal to go along with him. And of course, speculation that the federal reserve is considering a rate cut was contextualized as news the economy was weakening, not that inflation had all but disappeared amid the Fed dumping assets at a rate of $500 billion a year (off budget, of course.)

June's inflation numbers are likely to be negative. Deflation, that is. Despite headlines that oil prices surged 4% after an attack on oil tankers near Iran, oil prices came most of the way back down within hours. Gas prices are down 14 cents per gallon, and are likely to fall another 20 cents unless oil prices rebound significantly.

Instead of reporting on the lack of inflation, the media focused on slowing growth in wages. But with inflation less than 0.1% last month, the 0.3% rise in hourly workers' wages is actually very healthy.

The mainstream news isn't going to report this good news. Conservatives must do it. The shameful fact is that your average Democrat already believed -- months before the tariffs were implemented -- that inflation was in double digits. They're idiots. We can't let them talk the loudest about economics.

[bert]

This morning the President said we have collected billions in tariffs from China. That is simply not true. All tariff collections are made by US Customs before entry is permitted. The tariffs are paid by the American purchaser. Generally the purchaser is a corporate entity that passes all or some along to the consumer at the time of the final sales.

Later in his remarks, the president elaborated and explained that China was devaluing the currency or directly subsidizing China Exports to the USA. That is not the same as the claim that China is paying us money in the form of tariffs.

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Just $850.00 dollars to 100%.

[mfreddy]

This couldn’t be more wrong. I work for several companies that import kitchen cabinets, and a closet shelving manufacturer. All 3 companies have had multiple price increases that have mirrored the tariffs.

I also represent a domestic kitchen cabinet manufacturer that uses imported plywood for the sides of the cabinets. They have also raised prices due to the tariffs.

[DoodleDawg]

China doesn’t pay the tariffs; the importer does. And you can bet that they pass the costs on.

[dangus]

>> This couldn’t be more wrong.<<

It never ceases to amaze me when people believe that their anecdotes mean more than than million of data points.

[dangus]

>> China doesn’t pay the tariffs; the importer does. And you can bet that they pass the costs on. <<

Did you even read the article?

[Brian Griffin]

Many prices are higher.

I’ll generally wait to buy until Chinese learn to play the Trump way.

[dangus]

>> This morning the President said we have collected billions in tariffs from China. That is simply not true. All tariff collections are made by US Customs before entry is permitted. The tariffs are paid by the American purchaser. <<

The “American” purchaser is usually an American-incorporated subsidiary of the foreign company doing the importing. For instance, American Honda Motor Company imports Hondas from Japan and is owned by the Honda Motor Company of Tokyo.

>> Generally the purchaser is a corporate entity that passes all or some along to the consumer at the time of the final sales. <<

In this case at least, that turns out to be 100% wrong.

[mfreddy]

It never ceases to amaze me when people believe agenda driven reporting over real world experience. I have had exposure to the Chinese markets for years. The radical escalation in prices is being passed on almost to the penny in reflection of the tariffs.

[bert]

BS rationalization that is untrue. You are delusional

Lowes and Walmart are not foreign corporations. Sears is not a foreign corporation. Apple is not a foreign corporation.

[dynoman]

That’s true, a study was done on it;

http://www.econpol.eu/publications/policy_brief_11

https://www.bloomberg.com/news/articles/2018-11-19/china-is-paying-for-most-of-trump-s-trade-war-research-says

[billyboy15]

The tariffs are indeed collected by US Customs and despite your claim the tariff cash DOES IN FACT GO INTO THE GENERAL TAX FUND.

You are also not correct in saying these tariff costs are “paid by the American consumer”. Clearly that has not happened because importers have either eaten the increases or part of them while laying off the rest to possibly the wholesaler or perhaps even the producer of the goods being imported.

Could tariffs be passed on to consumers at some point? Maybe but as long as importers and wholesalers have choices of from whom they buy and we allow free competition in this country the likelihood is slim. In fact you can produce no numbers showing any increases in tariffs have been passed along to the consumer?

Get your facts straight next time before being a Debbie Downer and trying to blame MAGA for non existing problems.

[dynoman]

Did their price go up? Or are they ripping off the consumer?

Read post 12.

And this;

“Chinese exporters bear costs of Trump’s trade war, say EconPol researchers”
http://www.econpol.eu/press_releases/pm_2018-11-19

[dangus]

>> It never ceases to amaze me when people believe agenda driven reporting over real world experience. I have had exposure to the Chinese markets for years. The radical escalation in prices is being passed on almost to the penny in reflection of the tariffs. <<

Agenda-driven reporting? This isn’t from NBC News, this is from the Import Price Index from the Bureau of Labor Statistics. These are career bureaucrats who, if they had a political leaning, sure as hell wouldn’t be supportive of Trump’s tariffs.

[DannyTN]

Which means the tariffs are high enough yet.

Sure the US is getting the tariff money which is a win. But the goal was to bring industries, production and jobs back to the US.

To do that, you need to see the cost of Chinese goods increase, so that American goods can begin to take the market share.

[dangus]

Mostly probably just whining because they fear the long-term damage due to their industry of replacing American workers. The Chinese are trying to keep manufacturers relying on them, but ultimately they’re just defeating themselves, giving supply chains time to cultivate other sources.

[bert]

You are posting wishful thinking.

The consumers ultimately pay the China tax

The purpose of the tariffs is to make Chinese products so expensive they will cease to be competative. That fact was realized by Mexico and the EU. They changed the ir ways and there is no tariff.

Those here that worship at the tariff alter think the purpose is to raise revenue and eliminate the income tax. That is not true.

[Pelham]

..if they did read it, maybe they write copy for NPR...

[gogeo]

The article was spot on. You’re either economically illiterate or splitting hairs.