Social Question

SQUEEKY2's avatar

Trump has stated that he would impose a 10% tariff on all imported goods, how will that help inflation?

Asked by SQUEEKY2 (23149points) 1 month ago

If true that would increase a family of four living expenses by roughly $1,500 a year .
So could someone explain how imposing a tariff like that would help inflation?

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12 Answers

filmfann's avatar

The idea, which is flawed, is that you make Chinese goods more expensive, so people buy more American products.
It doesn’t work. People still buy the Chinese stuff, and end up spending more money.

Lightlyseared's avatar

Also American companies that have to import components or raw materials will struggle as theirs costs increase
And if they are exporting goods other countries will impose a similar tariff on US goods in retaliation making them less competitive. Look at the chicken tax for example and how that played out.

Caravanfan's avatar

By making goods more expensive it will do the exact opposite of controlling inflation.

jca2's avatar

Almost everything we buy is imported except for food. This is not a good thing.

seawulf575's avatar

The idea is that China uses low wage workers and even slave labor to produce goods. When they get to ship them to this country without tariffs they can under cut basically any US company producing the same thing. The tariffs are leveling the playing field, allowing US companies to compete which, in turn, produces more jobs.

It works the same way cutting taxes helps the economy. Trump’s tax cuts gave companies tax cuts if they passed some/most of the savings to their workers and/or hired more workers. The initial reaction is that by cutting taxes, it will cause the government to have to spend more money they don’t have. But what actually happens is more income tax is generated and less money is having to be spent to support people that can’t get a job.

In both cases it is stimulating the economy.

Blackwater_Park's avatar

It’s not going to help inflation at all. It will make it worse, but hey… the gov’t gets a small, almost insignificant tax revenue boost.

I do think long-term reducing dependence on China is good for the USA but on the flip side, having our economies tied so closely together is one of the last protective barriers keeping us from going to war with them.

flutherother's avatar

It is bar room talk of the kind that makes sense only to someone so drunk they need help to get home.

Forever_Free's avatar

Trump (let alone any President) can’t do a damned thing by themselves. It is useless babble to try to get votes. If what he promises doesn’t happen he will just blame others.

LadyMarissa's avatar

He said the same thing in 2016 & he still hasn’t come through!!! Also, remember that he’s using his own math where 2+2 does NOT = 4.

SQUEEKY2's avatar

I think with Wulfies example , is those countries will retaliate with tariffs of their own, not helping the economy one bit, one example with dementia-Don’s last go round with tariffs cost the us farmers billions in lost revenue due to grain tariffs china imposed in retaliation to the tariffs imposed on them.

Lightlyseared's avatar

China retaliated with tariffs of 25% on 128 items specifically choosing items that would impact republican voting states the most and is thought to be the single biggest contributing factor to him losing in 2020.
He also somehow managed to sour international relations with Canada and the EU stating he was imposing the tariffs to protect national security, while also affecting Mexico resulting more immigration to the US.
It was genius.

seawulf575's avatar

@SQUEEKY2 They already have high tariffs on our goods. And yes, they will up them. China as an example has always maintained higher tariffs on the USA than vice versa. It’s part of the trade war. But the difference is we have a marketplace that can buy our goods, they don’t. Yes, they have more people than we do, but they don’t pay them squat. They are exporting so much of their junk to the USA that if it costs too much to ship it, their profits go way down.

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