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I'm not American, but tariffs to fix import issues is pretty stupid.
This is the capitalist dream, export all the production of the goods you use daily to third world countries, who will have shit labor practices like the US used to have when slavery was a thing (and bluntly, for quite a while afterwards), so that the boots-on-the-ground laborers that produce everything are either treated like slaves or literally are slaves, then import the raw material to be manufactured into whatever you're selling in the US, so you can slap a "made in the USA" sticker on your shit to enhance sales and charge more. Meanwhile "made in the USA" doesn't and shouldn't imply that there's no imported goods going into the manufacturing process to make that thing, just that you took raw materials (from wherever) and made this thing in the USA.
Tariffs unduly harm end consumers, pretty much everything we buy and own is, or has components that are, imported shit.
Most microchips, a large amount of the food we eat, most electronics, pretty much everything you'll find at a dollar general, etc (the list is very very long)... all imported in whole or in part.
Hell, there was a time that it was more economical to have your raw materials, even if they're mined/harvested/produced in the USA, shipped overseas for assembly by slave labor, then shipped back for sale to the US public, than to have it assembled inside the US. Much of that is still true. The US neither has the manufacturing capacity, nor the desire to build their own shit. The only time that's not the economical option is for large cost (and scale, either in size or money) items, like housing or vehicles. Assembly generally happens in the country/landmass where the vehicle will be sold and used. Even a company like Toyota, a Japanese brand, will have assembly plants in the USA for cars sold in the USA, because that's cheaper than importing hundreds of vehicles. For everything else, it's generally cheaper to assemble it outside of the country and import the final product.
You think process are high now? Wait until the tariff wars really kick off.
No company is going to accept the costs of tariffs and be okay with that eating their profits, they're passing that cost into consumers, because we're the saps that are still going to buy it.
When the tariffs come down, and they will eventually, prices will drop, but not to where they were from before the tariffs. Companies will continue to post record profits, justifying not giving raises because tariffs, and wages will remain stagnant. We'll earn less, while they rob is for more than they already do.
The worst part is that when the tariffs are lifted, we'll thank them for lowering the prices by buying more of their shit. We'll be grateful for the opportunity to pay even more into their profit margins.
Congratulations, you're experiencing late stage capitalism. The system is working as intended. You are poor, you remain poor, barely able to scratch out a living, while your owners profit more and more off of your hard work, and you get to thank them for that opportunity.
I don't want to live on this planet anymore.
Prices won't go down, companies will pocket the difference
Oh, they'll go down.... But it won't be nearly as much as it went up to cover the tariff.
What I'm thinking is, let's say a widget is $100, tariffs go in at, say 5%. So it should cost $105, but the price increases to $110. People cry bloody murder, but ultimately they "need" the widget so they buy it. Tariffs go away, yay, the price is dropped, it's now $107.99
that's what I'm thinking.
Also it's all the Democrats fault.
In practice, that's not what happens generally. A widget is $100, the 5% tariff brings it up to $105 and company bumps the price to $110. People need the widget so they buy it at $110. Tariff goes away, but company knows that people will pay at least $110 for the widget, so they try bumping the price to $115. Maybe it doesn't sell, so they "discount" it back to $110 and people will happily buy it thinking they're getting a deal, while the company is pocketing that extra $10.
That's certainly a possibility.
I would argue that we're both right depending on what the widget is.
(Assuming the price is changed to be proportional and appropriate for the product) Something like a grocery item is more prone to my thought, and something that has generational differences, such as a laptop or something, will likely follow your theory more closely.
I think a lot of this will still be tied to price elasticity. If the price is very elastic then the former system would be more likely. Drop the price so you can push more units (and overall, profit goes up), where things that are far less elastic, say, an iPhone, would tend to simply continue to increase like the latter system you describe.
At the end of the day, both are horrid, terrible, and very very common. So I'll finish by saying: no matter what happens, people are going to be getting massively fucked, and corporations will post record profits yet again.
Fuck corporations.