MoreFacts wrote:
Just a little basic math here for the people who do not understand tariffs. Companies import goods and they pay the tariff on receipt of goods. This is a cost to them that they pass on to their customers by raising prices. So an annual increase of $697B in tariffs divided by 345M people in the USA = $2020 per person since we are the customers. In other words, our cost of living is going up $2k per person per year on average.
Of course, that does not include the effect of retaliatory tariffs which will hurt the value of the dollar abroad, decrease sales of US products abroad, thereby weakening our economy.
It is more complex than this, but the pain will not be short term. It takes years to build factories if that is actually the goal. And US labor will never be as cheap as current foreign labor, especially if we deport the cheaper labor we have. So costs will go up permanently for Americans.
Thank you for that. Here are some more side effects.
1. Some companies can’t pass on the increases so they close their doors and the workers no longer have jobs.
2. More out of work people mean less demand for products.
3. less demand means economic recession