Trump's tariffs are costing Americans $1.4 billion each month

Yarddog

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Trump's tariffs are costing Americans $1.4 billion each month, study shows

President Donald Trump’s trade policies and tariffs reduced U.S. income at a rate of $1.4 billion per month by the end of last November, according to new research from the Federal Reserve Bank of New York, Princeton University, and Columbia University.

The collaborative study found that businesses and consumers saw “substantial increases” in the price of goods throughout last year, including a “complete passthrough” of U.S.-imposed tariffs onto imported items. The economists — the New York Fed’s Mary Amiti, Princeton professor Stephen Redding, and Columbia professor David Weinstein — also said Americans suffered by a lack of import variety and disruptions to supply chains.

“Economists have long argued that there are real income losses from import protection. Using the evidence to date from the 2018 trade war, we find empirical support for these arguments,” the researchers wrote. “Losses mounted steadily over the year, as each wave of tariffs affected additional countries and products, and increased substantially after the imposition of the wave 6 tariffs on $200 billion dollars of Chinese exports.”
 

mark kennedy

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No one ever wins a trade war, it's going to cost the US more then we will ultimately gain. I thought the days of protectionism were behind us but apparently it's being revisited by Trump and his cohorts. One interesting aspect, he is putting on a clinic on the dynamics of protectionism that economists and historians will have ample opportunity to analyze endlessly. Let's hope it serves as a warning and someone in the White House comes to their senses and brings China to the negotiating table soon.
 
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Yekcidmij

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What is the monthly cost of not having the tariffs?

I would be interested in any evidence to support a claim that tariffs are less costly than no-tariffs. Just on principle alone, it's hard to see how taxing consumers is more economically beneficial than not taxing them.
 
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Yarddog

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[Citation needed]
It's simple. The study found that the tariffs added 1.4 billion to the costs of imported goods. Remove those costs and the goods are 1.4 billion dollars cheaper.

Now if you want to go into what cheap imports from China, etc... cost the US economy, that is a more complex matter.
 
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thecolorsblend

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It's simple. The study found that the tariffs added 1.4 billion to the costs of imported goods. Remove those costs and the goods are 1.4 billion dollars cheaper.

Now if you want to go into what cheap imports from China, etc... cost the US economy, that is a more complex matter.
That was where I was ultimately planning to steer my contributions to this discussion, yes.
 
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Yarddog

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That was where I was ultimately planning to steer my contributions to this discussion, yes.
Part of the idea behind tariffs is to raise the cost of imported goods so that domestic goods can compete on a more equal market. The consumer ends up paying the costs so a tariff is similar to a sales tax on imported goods.
 
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Yekcidmij

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That was where I was ultimately planning to steer my contributions to this discussion, yes.

I think you missed one of the points of the paper. Costs are passed through to consumers. Companies aren't absorbing the costs (especially by hiring more people). You also missed the remarks in the paper that gave a comparative measure:

"Alternatively, if we were to think that a successful outcome from the trade war would be the creation of 35,400 manufacturing jobs, the
number of steel and aluminum jobs lost in the last ten years, then the deadweight welfare loss per job saved is $195,000, which is almost four times more than the annual wage of a steel worker: $52,500. These benchmarks suggest that the costs of the trade war are quite large relative to optimistic estimates of any gains that are likely to be achieved." (pg 14)​

So that looks like the comment you were looking for.

See also:
The Macroeconomic Effects of Trade Tariffs : Revisiting the Lerner Symmetry Result

The macroeconomic implications of a global trade war | VOX, CEPR Policy Portal

http://www.econ.ucla.edu/pfajgelbaum/RTP.pdf
 
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thecolorsblend

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Part of the idea behind tariffs is to raise the cost of imported goods so that domestic goods can compete on a more equal market. The consumer ends up paying the costs so a tariff is similar to a sales tax on imported goods.
It comes down to how you look at it. I think people own enough cheap imported plastic junk as it is. But if tariffs allow American workers to compete with countries where workers are lucky to earn $5 per day, I’m fine with paying a higher cost.
 
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Yekcidmij

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It comes down to how you look at it. I think people own enough cheap imported plastic junk as it is.

An interesting question here is why you should make that decision for everyone else.

But if tariffs allow American workers to compete with countries where workers are lucky to earn $5 per day,...

Do you have evidence that this is the result? The evidence so far is that the results are negative on the economy, which happens to be in line with what economic theory predicts.

Another one of your mistakes seems to be in some sort of assumption that a tax increase results in a positive shock to productivity. For some reason, you think that increasing production costs by levying a tax will result in more hiring. Not sure why you think that.
 
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Yekcidmij

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A similar study from UC Berkeley.

http://faculty.haas.berkeley.edu/arose/Tariffs.pdf

upload_2019-3-27_14-43-47.png
 
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Yarddog

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It comes down to how you look at it. I think people own enough cheap imported plastic junk as it is. But if tariffs allow American workers to compete with countries where workers are lucky to earn $5 per day, I’m fine with paying a higher cost.
I'm a union man, so I've been "buy American" for my life time but, sadly, most Americans are about buying cheaper. This is both Conservatives and Liberals. The American people chased off domestic manufacturing and we are paying the price for what the past two generations have done.
 
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FanthatSpark

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In our current reality of globalism being ...slowly... taken apart here in America where lawlessness has flourished to the flesh of the (Global) lawless people. A piece of American history may be relevant to discussed tariff subject. Tariff used to be the tax that paid for the gov. 1913 was the year "we the people" started being the tax. That tax on a person is now being seen most prominently in France. As stated above, tax on a person is global infiltration to a "we the people" constitutional nation/republic.

Today, it is going to cost money to fix money (OP) being our masters for generations which in essence we have been wage slaves because my mom and dad tell me wage slavery and people taking my wage (Tax on the person instead of it being in trade as it used to be in 1912 / Tariffs) is good. <-- That is generational ignorance to us as a people. We all trusted and in that trust for 106 years we are pointing to each other as blame to our micro issues, not that it is not real to you in cause and effect or me too, but it is genius methodology that none of us look at in next paragraph.

This term has been lost... Generational Practices. Let me give you some examples out of too many and reuse above issue. I am a lawmaker in the U.S. and I put the tax on the people in a past, 106 years ago. People die in those 106 years and are born into tax on ourself = reality of our survival. I am also a import export business owner in Britain 106 years ago and I do not suffer tariffs from America now ($Cha Ching$). I am a huge brained man and I see the benefits to my children and legacy on the backs of the people so let me teach tax is good and necessary on/to a people (can you say in modern terminology Board of education = Common core that also equals from a top down pyramid what we get is what is allowed, now attach omit constitutional history). However, at the same time 106 years ago land and resources are plenty so these laws just sit there and wait for people to die and bring in the wage slave generation. As said above when resources are plentiful there is no need to look at those laws of
yester-century ... Now, entertainment and devices in the land of few resources is trending.This promotes further ignorance by using fun as a distraction to yester-century's law that actually was treason to us all. All this paragraph used Generational practice where I will uneducated a populous to not know tariff was the tax.


In actuality, our states should have tariffs on their goods/resources like in 1912. This negates land tax too along with personal tax. So , I said all that drivel above for two reasons. 1. Cant fit this in a tweet ^_^ and it be trending, which should show us how we are lost :doh: , unless we start teaching our children that constitution BEFORE 1913 and tariff law. #2. That bad orange man did a press conference where a statement went unnoticed, the following is not a quote but paraphrase. He said, "I found some old tariff laws that had a bunch of dust on them". :amen:

FYI... I do not see the political as R & D. I see it as it is... Money vs The people. Turning a massive ship (Our Nation) from its globalist ways that have no law unto itself is a process where as the ship is righting itself there are real people fighting too keep their slavery because it is all they know under feelings. Thats what a tweet is... Response without the 1,000 page law a tweeter has to read... Thats sooo boring :doh:and not trending . <-- Last sentence said with voice fry. Look it up in u tube.

:groupray: for the people.
 
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thecolorsblend

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An interesting question here is why you should make that decision for everyone else.



Do you have evidence that this is the result? The evidence so far is that the results are negative on the economy, which happens to be in line with what economic theory predicts.

Another one of your mistakes seems to be in some sort of assumption that a tax increase results in a positive shock to productivity. For some reason, you think that increasing production costs by levying a tax will result in more hiring. Not sure why you think that.
I'm simply advocating giving tariffs a chance. It took in excess of twenty years for America's manufacturing base to reach the level it's at right now. Correcting that won't happen overnight.

If tariffs don't work, we should try something else. I'm not married to tariffs. I'm married to rebuilding America's manufacturing sector.
 
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