Why it’s ‘mathematically impossible’ for tariffs to eliminate U.S. trade deficit: Economist #shorts
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If you really want the public to understand this, bring up something everyone was taught about in middle school. The Smoot-Hartley Tariff Act.
Right now….no…re shoring isnt the way… new businesses are.
The problem is, America has been getting fleeced globally for the past few decades. We have to negotiate from a position of power. High tariffs are a good starting point. Not one of these economists have been right about anything for at least 30 years.
Tariffs are not a good starting point. They will further drive inflation and, as stated in the video, diversify supplier sources.
The reason why tarrifs will not improve manufacturing to a significant level is the U.S. is not competitive (efficient) at producing most of our imports, which is why those goods are imports. For other items, we can’t grow them to a significant level (coffee beans).
Search ‘economics division of labor.’ This is a basic economic term that directly addresses what I explained above. The essence is some people (or companies, or countries) are much more efficient at producing a good, which is why it is best if they produce that good. Trying to make a less efficient (or more costly) supplier have a competitive edge by introducing tarrifs produces a net drag (because it is less efficient) on the system/economy.
So, the fact that we were the richest the country has ever been when tariffs were how we got money (not taxing the crap out of its citizens) means it doesn’t work?
Well it’s Yahoo 😂😂😂