Taxing and tariffs

[sportbikerider78]

Off topic thread moved to Inglenook

Boy, you have a poor view of these noble cigarette companies. It’s not like they’re knowingly putting out a product that could harm people, or something like that...

Companies provide what people want. We need to dispel these myths of taxing 'unethical' products like tobacco and alcohol. There are tons of products we like that can cause us harm in excess.

 

[Seasoned Oak]

Companies provide what people want. We need to dispel these myths of taxing 'unethical' products like tobacco and alcohol. There are tons of products we like that can cause us harm in excess.

Its not about ethics. Its about product life cycle. If companies were made to be at least partly responsible for where their product ends up and how it harms the environment and every living thing along the way, they would make at least a minimum effort to change. No one likes taxes but they do change behavior and lead to innovation in the field. I like seafood but i fear it may be unavailable in the future or too toxic to consume. Ill gladly pay a small tax to change that. Its also not just about US. Asian countries are the biggest contributors to the pacific garbage patch ,they will respond to taxes (or tariffs)far faster than ethics.

 

[Ashful]

Companies provide what people want. We need to dispel these myths of taxing 'unethical' products like tobacco and alcohol. There are tons of products we like that can cause us harm in excess.

I agree with your sentiment. But it’s unrelated to the point. Companies find the least costly way to produce their product, to thrive in a competitive market place, even when it has a detrimental effect on society at large. Point in case, cigarette filter shall be produced at the lowest possible cost, any effect on the environment being only a secondary consideration.

In ideal capitalism, folks could vote with their wallet, and just buy cigarettes from the companies that have minimized their environmental impact. But that would require transparency and knowledge of data to which the customer typically has no knowledge or access, and it would also require consumers with the wherewithal and disposable income to make that choice.

 

[sportbikerider78]

I agree with your sentiment. But it’s unrelated to the point. Companies find the least costly way to produce their product, to thrive in a competitive market place, even when it has a detrimental effect on society at large. Point in case, cigarette filter shall be produced at the lowest possible cost, any effect on the environment being only a secondary consideration.

In ideal capitalism, folks could vote with their wallet, and just buy cigarettes from the companies that have minimized their environmental impact. But that would require transparency and knowledge of data to which the customer typically has no knowledge or access, and it would also require consumers with the wherewithal and disposable income to make that choice.

Well, you mentioned nobility, not me, so yes...its relative to ethics. You comment was clearly a slant at the ethics of th ed company..which is fine with me..I have no stake in the tobacco companies.
As with any issue...if people are educated they make different decisions. It think it is laughable we are talking about filters on smokes as an environmental issue..but maybe that is because I have not been educated. It seems like very small potatoes..but I do not know.

 

[sportbikerider78]

Its not about ethics. Its about product life cycle. If companies were made to be at least partly responsible for where their product ends up and how it harms the environment and every living thing along the way, they would make at least a minimum effort to change. No one likes taxes but they do change behavior and lead to innovation in the field. I like seafood but i fear it may be unavailable in the future or too toxic to consume. Ill gladly pay a small tax to change that. Its also not just about US. Asian countries are the biggest contributors to the pacific garbage patch ,they will respond to taxes (or tariffs)far faster than ethics.

Well..we create companies....so....

Any tax is just passed to the consumer anyway.

 

[Seasoned Oak]

Well..we create companies....so....

Any tax is just passed to the consumer anyway.

Until the consumer dont buy their product anymore because its more expensive than alternatives. Plus the tax that the consumer pays goes to the cleanup cost of the product in the environment(Ideally). Same as tariffs .Tariffs are used to compell companies to make their products here in the US rather than ship production abroad.Not just to collect tax money. Its a tool.

 

[sportbikerider78]

Until the consumer dont buy their product anymore because its more expensive than alternatives. Plus the tax that the consumer pays goes to the cleanup cost of the product in the environment(Ideally). Same as tariffs .Tariffs are used to compell companies to make their products here in the US rather than ship production abroad.Not just to collect tax money. Its a tool.

Tariffs are a great example of this theory not working..just passing cost to the consumer. We are seeing that happen right now with the latest tariffs driving cost.

 

[Seasoned Oak]

Tariffs are a great example of this theory not working..just passing cost to the consumer. We are seeing that happen right now with the latest tariffs driving cost.

Im assuming you dont play chess,cuz every move you make affects what happens 4,5,6 steps ahead. Tariffs are working fine toward the objected goal which is to create a level playing field for trade. Unless your fine with the last 30 years of other countries pounding us into the ground charging us tariffs while we charge them just about nothing. China charges us 25% for almost everything we send them,we charge them 2-3% ..Now they are screaming cuz we want equal treatment.

 

[Ashful]

Tariffs are a great example of this theory not working..just passing cost to the consumer. We are seeing that happen right now with the latest tariffs driving cost.

Exactly. But you say this as if it’s an example why tariffs don’t work, when really, it is precisely why they DO work. Those costs are passed to the consumer, who is then incentivized to try an alternative product.

Most countries have been doing this for years, as a form of protectionism. I saw it to the highest degree when I lived in Germany, you could buy a German-made TV or an Asian TV... but thanks to tariffs, they were going to cost you the same. Likewise with automobiles. It was their way of protecting German manufacturing, and one could make some good arguments (national security) for protecting your manufacturing capabilities.

 

[Seasoned Oak]

Just the threat of tariffs has worked already for mexico. Others will follow. (Canada and Europe) China may hold out the longest but they have lot more to lose. Of course public outrcry means little in a communist country. Many smaller countries have a 100% tariff on imported goods. Philippines and Costa Rica for example. An imported 30k auto is 60k . $15 imported jeans are $30.

 

[venator260]

Just the threat of tariffs has worked already for mexico. Others will follow. (Canada and Europe) China may hold out the longest but they have lot more to lose. Of course public outrcry means little in a communist country. Many smaller countries have a 100% tariff on imported goods. Philippines and Costa Rica for example. An imported 30k auto is 60k . $15 imported jeans are $30.

But is the revised trade deal all that better? Especially if Canada taps out.

And you mention those higher priced goods as if it were a good thing, and it's exactly what sportbikerider was saying. If a country's citizens are paying $30.00 for a $15.00 pair of jeans, it is not foreign countries that are paying the tariff, it's the citizens of that country. Making cars more expensive makes everyone worse off. And we tried this before, most recently under George Bush. Steel tariffs were put in place, and without looking up any numbers, those tariffs did save jobs... at something like $1.2 million in higher prices per saved job. And the economic data bears that out generally. While I'm opposed to any new government program, if it's even done halfway efficiently, it is better to remove trade barriers and retrain the workforce in those industries in which a country with its given resources can be competitive.

I think one of the issues with this is that folks hear "trade deficit" and think that is a bad thing. But trade is not a football game, for us to win, someone else doesn't have to lose.

 

[Seasoned Oak]

I think one of the issues with this is that folks hear "trade deficit" and think that is a bad thing. But trade is not a football game, for us to win, someone else doesn't have to lose.

No, but it has to be fair and reciprical, or one side DOES lose. Its been the US on the losing end of unfair trade agreements. So what is your solution, just keep bleeding jobs and market cuz you might raise prices temporarily. We have been doing that for decades, so your in good company if thats your solution. If we want the jobs back (millions of jobs)we have to fix this. Iv read for every $1 BIllion in trade deficit 20000 jobs are lost. Given the hundreds of billion of deficits were running thats a lot of jobs. About 10 million jobs. Iv yet to hear all the tariff nay sayers come up with a single viable solution. Because there is no easy solution where no pain is involved, at least short term pain.

 

[sportbikerider78]

Exactly. But you say this as if it’s an example why tariffs don’t work, when really, it is precisely why they DO work. Those costs are passed to the consumer, who is then incentivized to try an alternative product.

Most countries have been doing this for years, as a form of protectionism. I saw it to the highest degree when I lived in Germany, you could buy a German-made TV or an Asian TV... but thanks to tariffs, they were going to cost you the same. Likewise with automobiles. It was their way of protecting German manufacturing, and one could make some good arguments (national security) for protecting your manufacturing capabilities.

The example you gave is also another example of them not working.
The more a person overspends for a TV the less other products they can buy (German and foreign). You're making the German TV company rich via lobbying/tariffs against another company. This gives the German company a competitive advantage and leverage over the consumer via politics. It is as far as you can get from free trade. It also removes incentive for the German company to be as competitive as possible..after all..the are protected.

The question that needs asking, is why can't the German company compete with the other manufacturer?

We should be looking at all transactions as a trade between people. Not a trade between countries/governments. We don't need governments to facilitate our trade. We can figure that out just fine on our own.

This is just a little clip from Milton Friedman on the free market and tariffs. In this case (once upon a time) cheaper steel from Japan.
In case you are wondering who he is....Milton Friedman (/ˈfriːdmən/; July 31, 1912 – November 16, 2006) was an American economist who received the 1976 Nobel Memorial Prize in Economic Sciences for his research on consumption analysis, monetaryhistory and theory and the complexity of stabilization policy.[4] With George Stigler and others, Friedman was among the intellectual leaders of the second generation of Chicago price theory, a methodological movement at the University of Chicago's Department of Economics, Law School and Graduate School of Business from the 1940s onward. Several students and young professors who were recruited or mentored by Friedman at Chicago went on to become leading economists, including Gary Becker, Robert Fogel, Thomas Sowell[5] and Robert Lucas Jr.[6]

 

[Seasoned Oak]

Tariffs and closed markets are facilitating 7 to 10% Yearly Growth for china for decades. Try telling china tariffs dont work.

 

[Seasoned Oak]

The question that needs asking, is why can't the German company compete with the other manufacturer?

Its not that simple. How can you compete when the country your selling into is adding 25% to 100% tarrifs to the price of your product.
What we have with china is NOT free trade. They charge us 25% we charge them 2- to 3% .Either we should match the tariffs they charge or both countries should go to Zero tariffs. Then you have free trade.

 

[AlbergSteve]

Its not that simple. How can you compete when the country your selling into is adding 25% to 100% tarrifs to the price of your product.
What we have with china is NOT free trade. They charge us 25% we charge them 2- to 3% .Either we should match the tariffs they charge or both countries should go to Zero tariffs. Then you have free trade.

Won't be free trade as long as there are subsidies... or the rejection of imports under the veil of national security.

 

[sportbikerider78]

Its not that simple. How can you compete when the country your selling into is adding 25% to 100% tarrifs to the price of your product.
What we have with China is NOT free trade. They charge us 25% we charge them 2- to 3% .Either we should match the tariffs they charge or both countries should go to Zero tariffs. Then you have free trade.

I never said trade with China was free trade..and I agree with you. What we need is free trade and governments squabbling over who can sell what for what price is ridiculous. Matching tariffs will only hurt the consumer.
Even more so, China is a developing country and doesn't have half the environmental, legal, health, regulations we have in our country. Even if the tariff was even, is that still an equal playing field? Something to think about. Nations are never equal.

That company may choose not to sell to that other company/individual in said country. It is that simple. Don't sell to China if you aren't getting a fair deal. Apparently US farmers can still turn a profit moving lots of soybeans, corn, and cotton to China. It is too bad the companies in China are getting screwed by their government for those products. Or maybe they really aren't. You never know over there.

Here are the top exports to China from the US.
Incidentally, with the new 25% tariff, China will start buying more soybeans from Brazil. I'm sure the US farmer isn't too happy with that.
I knew nothing about this till now...I really didn't know soybeans were such a big export. https://www.bloomberg.com/graphics/2018-soybean-tariff/

1. Soybeans: $15 billion
2. Civilian aircraft: $8.4 billion
3. Cotton: $3.4 billion
4. Copper materials: $3 billion
5. Passenger vehicles (small engines): $3 billion
6. Aluminum materials: $2.4 billion
7. Passenger vehicles (large engines): $2.2 billion
8. Electronic integrated circuits: $1.7 billion
9. Corn: $1.3 billion
10. Coal: $1.2 billion

 

[venator260]

No, but it has to be fair and reciprical, or one side DOES lose. Its been the US on the losing end of unfair trade agreements. So what is your solution, just keep bleeding jobs and market cuz you might raise prices temporarily. We have been doing that for decades, so your in good company if thats your solution. If we want the jobs back (millions of jobs)we have to fix this. Iv read for every $1 BIllion in trade deficit 20000 jobs are lost. Given the hundreds of billion of deficits were running thats a lot of jobs. About 10 million jobs. Iv yet to hear all the tariff nay sayers come up with a single viable solution. Because there is no easy solution where no pain is involved, at least short term pain.

The bleeding jobs thing is curious, and it's an odd argument for fans of our current administration to make. Because they're simultaneously touting the lowest unemployment ever with trade deals that are stealing our jobs. That number, my guess, looks only at job losses, not at other gains created by trade; cheaper goods. That helps other sectors of the economy. Essentially, the worker that changed jobs from the steel mill to the construction company is counted as a loss, even though that person still has a job.

And no, I don't think that we should continue course. I think that we should work at removing existing trade barriers and other distortions to the market (like the subsidies mentioned in another post) because allowing the market to work will make goods cheaper; cheap enough to outweigh the negatives. What we've been doing for decades (liberalizing trade) as resulted in a fairly steady growth in buying power. Again, the mistake that's being made here, I think, is that a trade deficit is a problem that needs solving.

You mention China. And I suppose that it isn't fair that they subsidize and protect their own industries. But what has the tariffs placed upon Chinese good achieved thus far. So far as I can tell, all that it has done is caused the Chinese government to place retaliatory tariffs against the United States, making several types of good more expensive and prompting additional farm subsidies, ultimately hurting the American consumer (everyone) to save a few jobs in the steel industry. And as sportbikerider mentioned, China can grow as they do (its more like 6-7% lately, contrasted with around 3% with the U.S. (GDP)) because they are a developing country. They have underutilized labor resources that can be tapped to achieve growth that is impossible for the United States. They're growing not because they're doing better than the U.S, they're just going through a process (Industrial Revolution) that we've already completed.

 

[Seasoned Oak]

Im still not hearing solutions ,only complaints about how its being handled. Bad trade deals have been draining the wealth of this country for 30 years and no one has done much of anything(until now) to fix it. Coincidentally we have been borrowing trillions to cover the budget over the same time period. All those millions of lost Mfg jobs not paying taxes into our Govt but instead those jobs boosting other countries GDP. Had they(jobs) remained here for the same time period would have painted a very different picture.

 

[Seasoned Oak]

1. Soybeans: $15 billion
2. Civilian aircraft: $8.4 billion
3. Cotton: $3.4 billion
4. Copper materials: $3 billion
5. Passenger vehicles (small engines): $3 billion
6. Aluminum materials: $2.4 billion
7. Passenger vehicles (large engines): $2.2 billion
8. Electronic integrated circuits: $1.7 billion
9. Corn: $1.3 billion
10. Coal: $1.2 billion

Small potatoes compared to what china sells us. At a greatly lower tariff rate. When they get done stealing all our IPR they wont be buying much of anything from us. China is NOT our friend ,their 50 year plan is working flawlessly ,while our plan, cant seem to think beyond the current Adm.

 

[venator260]

Im still not hearing solutions ,only complaints about how its being handled. Bad trade deals have been draining the wealth of this country for 30 years and no one has done much of anything(until now) to fix it. Coincidentally we have been borrowing trillions to cover the budget over the same time period. All those millions of lost Mfg jobs not paying taxes into our Govt but instead those jobs boosting other countries GDP. Had they(jobs) remained here for the same time period would have painted a very different picture.

I said exactly what I would do; continue liberalizing trade, because it has been beneficial.

I suppose it would surprise you to know that U.S. manufacturing output is at its highest levels in history? We're not losing manufacturing jobs to China, we're losing them to our own productivity. Real wages are growing, unemployment is low. The current "solutions" are wrongheaded, misguided, and will result in more harm than good. Indeed it's already started. This article came up as I was browsing Facebook today. There are many like it.

https://reason.com/archives/2018/09/17/casualties-of-trumps-trade-war

 

[Seasoned Oak]

Why are tarriffs working superbly for most of the world but supposedly its not good for US. China ,Europe, Canada and mexico, our largest trading partners are at this moment fighting tooth and nail to KEEP their tariffs. If tariffs dont work, why are all the worlds biggest markets so protective of their own tariffs . Mexico has decided to adopt a better trade relationship with the US rather than disrupt markets and suffer the consequences but other countries are holding out as they seem the LOVE their own high tariffs and would rather a trade war than to give them up.

 

[Seasoned Oak]

This article came up as I was browsing Facebook today. There are many like it.

Facebook, Really, Facebook!!

 

[venator260]

Why are tarriffs working superbly for most of the world but supposedly its not good for US. China ,Europe, Canada and mexico, our largest trading partners are at this moment fighting tooth and nail to KEEP their tariffs. If tariffs dont work, why are all the worlds biggest markets so protective of their own tariffs . Mexico has decided to adopt a better trade relationship with the US rather than disrupt markets and suffer the consequences but other countries are holding out as they seem the LOVE their own high tariffs and would rather a trade war than to give them up.

The last vestiges of mercantilism in those countries? I don't know your views outside of economics; my guess is that most of Europe has plenty of policies you also disagree with. I would argue that those countries that pursue economic protectionism would enjoy benefits from turning away from those policies. There's evidence for this, as countries liberalize their trade polices, their economy improves.

Here's what I base everything that I've said in this tread on: The recently enacted tariffs are having demonstrable, detrimental effect on our economy. That tariffs are bad policy is an idea receiving near universal agreement among economists from across the ideological spectrum.

 

[venator260]

Facebook, Really, Facebook!!

It's how I came across the article, not the source of the article. Did you read it?

And would you hold it against my information if I cited a New York Times article (or Fox News, if that's your thing) that I happened across on Facebook?