As we discuss the impact of tariffs on business, the focus is unequivocally on importers and consumers who have to foot the bill and pay more for the same goods.
"Controlled for retaliatory tariffs" is a key note on that chart, which means that the phenomenon described is: Place selected import tariffs on Chinese exporters to the US -> input costs for *all* US manufacturers go up -> those higher costs get tacked onto selling prices -> higher selling prices make US goods less competitive in export markets.
As I recall, those import tariffs weren't overly controversial as China has long been seen as acting in bad faith re: loss-leader pricing, dumping, and IP theft, so perhaps that 2% extra drag on exporters was seen as a necessary evil/insurance/buying time to hinder the Chinese from eventually putting them completely out of business.
It will be interesting to see how quickly and to what degree the current wave of tariffs against the US' (former) friends who were decades-long free-trade partners backfires spectacularly, especially as "shotgunning" blanket tariffs versus "rifle-shooting" selected tariffs is much more immediate and noticeable to the public.
please clarify : china tariffs resulted in an average NET america export tariff of 2% ?
seems complementary to specific cases (e.g., steel vs cars) where tariffs in one sector were more than offset by damage in another sector, but this is the first i have seen on an overall effect of trump 1.0 (or any era).
The net export tariff of 2% comes from a model calculation. Essentially, they tried to identify how big a tariff all export partners of the US would have to impose to create the same decline in overall exports. And the number they came up with is 2%.
And yes, that’s the average over the whole economy. In practice, some exporters were hit much harder than others. For example, car exporters were hot harder because they used more steel which was subject to import tariffs and as a result, American cars got more expensive and harder to sell abroad.
"Controlled for retaliatory tariffs" is a key note on that chart, which means that the phenomenon described is: Place selected import tariffs on Chinese exporters to the US -> input costs for *all* US manufacturers go up -> those higher costs get tacked onto selling prices -> higher selling prices make US goods less competitive in export markets.
As I recall, those import tariffs weren't overly controversial as China has long been seen as acting in bad faith re: loss-leader pricing, dumping, and IP theft, so perhaps that 2% extra drag on exporters was seen as a necessary evil/insurance/buying time to hinder the Chinese from eventually putting them completely out of business.
It will be interesting to see how quickly and to what degree the current wave of tariffs against the US' (former) friends who were decades-long free-trade partners backfires spectacularly, especially as "shotgunning" blanket tariffs versus "rifle-shooting" selected tariffs is much more immediate and noticeable to the public.
Boycotts also appear to have very long behavioral tails. I know people of my mid-80s-age parents' who won't buy California lettuce and grapes https://en.wikipedia.org/wiki/Salad_Bowl_strike nor Nestle products https://en.wikipedia.org/wiki/1977_Nestlé_boycott decades later.
The CEO of Brown-Forman (maker of Jack Daniels and other deep Red State booze) is already singing the blues https://www.reuters.com/business/retail-consumer/brown-forman-misses-quarterly-sales-estimates-muted-spirits-demand-2025-03-05/ ; they already have the red stockprice chart to match https://www.google.com/finance/quote/BF.B:NYSE?window=5Y . Boo hoo hoo.
More Leopards Ate My Face Party action https://en.wiktionary.org/wiki/Leopards_Eating_People%27s_Faces_Party .
please clarify : china tariffs resulted in an average NET america export tariff of 2% ?
seems complementary to specific cases (e.g., steel vs cars) where tariffs in one sector were more than offset by damage in another sector, but this is the first i have seen on an overall effect of trump 1.0 (or any era).
The net export tariff of 2% comes from a model calculation. Essentially, they tried to identify how big a tariff all export partners of the US would have to impose to create the same decline in overall exports. And the number they came up with is 2%.
And yes, that’s the average over the whole economy. In practice, some exporters were hit much harder than others. For example, car exporters were hot harder because they used more steel which was subject to import tariffs and as a result, American cars got more expensive and harder to sell abroad.
ok. i mistakenly said 'china' tariffs when it appears the effect was from all new tariffs during trump term 1.