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Trump’s Washing Machine Tariffs Stung Consumers While Lifting Corporate Profits (NYT)

Kirblar

Kirblar

Banned
Oct 25, 2017
30,744
New research shows how a move meant to aid domestic manufacturers instead padded profits and raised prices on a wide variety of laundry items.

https://www.nytimes.com/2019/04/21/business/trump-tariffs-washing-machines.html

President Trump's decision to impose tariffs on imported washing machines has had an odd effect: It raised prices on washing machines, as expected, but also drove up the cost of clothes dryers, which rose by $92 last year.

What appears to have happened, according to new research from economists at the University of Chicago and the Federal Reserve, is a case study in how a measure meant to help domestic factory workers can rebound on American consumers, creating unexpected costs and leaving shoppers with a sky-high bill for every factory job created.
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Research to be released on Monday by the economists Aaron Flaaen, of the Fed, and Ali Hortacsu and Felix Tintelnot, of Chicago, estimates that consumers bore between 125 percent and 225 percent of the costs of the washing machine tariffs. The authors calculate that the tariffs brought in $82 million to the United States Treasury, while raising consumer prices by $1.5 billion.

And while the tariffs did encourage foreign companies to shift more of their manufacturing to the United States and created about 1,800 new jobs, the researchers conclude that those came at a steep cost: about $817,000 per job.
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"Unexpected" unless you listened to literally everyone in the economics mainstream instead of xenophobic cranks like Peter Navarro.
 

Operations

Member
Oct 29, 2017
1,174
Companies that largely sell imported washers, like Samsung and LG, raised prices to compensate for the tariff costs they had to pay. But domestic manufacturers, like Whirlpool, increased prices, too, largely because they could.
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What a friggin disaster.
 
TheClaw7667

TheClaw7667

Member
Oct 25, 2017
1,704
FyreWulff said:
Capitalism loves it's pricing cartels.

"Why should we compete on price when we could be getting the same amount of money as everyone else?"
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Yep. Everyone was so hopeful for the new AMD video card to be much cheaper than Nvidia's offerings but instead they priced it very close to Nvidia's RTX cards. Why would they lower the price when people are willing to pay those higher prices.
 
PanzerKraken

PanzerKraken

Member
Nov 1, 2017
14,974
What a shit show. My company had everything we sell get a tariff on it of 10%. We've been struggling with rising costs on everything for past couple years now to stay competitive, and now everything we sell and make went up 10%? Oh we should find an American source? Yea no, there is no places that can provide what we need in the US, and if they do we are going to be paying a good 25-40% increase in price on all our goods. The tariffs are achieving nothing but hurting the economy, it's hurting the small guys especially as we have few options to turn too, and are just being punished for no reason. Every company we buy from our supplies is also being impacted by tariffs, so they too are having to raise prices on products by 10-25% to us.

And sadly this is a contributing factor in us deciding that we are likely going to have to shut down in about a year or two as Mr Trump's tariffs have done nothing but hurt us greatly. His Tax cuts have done nothing for us, it was minuscule change that doesn't compensate the damage the tariffs are doing. So people are going to be losing jobs as we can't stay in business. Making America Great
 
Psychonaut

Psychonaut

Member
Jan 11, 2018
3,207
FyreWulff said:
Capitalism loves it's pricing cartels.

"Why should we compete on price when we could be getting the same amount of money as everyone else?"
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This has always been my fundamental issue with capitalism.

Also, as much as I abhor all of that guy's policies, it's funny that this is the only one that has directly affected me. I'm still doing laundry at my mom's place because machines are so damn expensive right now.
 
Slayven

Slayven

Never read a comic in his life
Moderator
Oct 25, 2017
93,022
That of course allowed Dom manufactures to raise wages and offer better benefits, right?
 
jett

jett

Community Resettler
Member
Oct 25, 2017
44,653
capitalism, how does it work

apparently, trump doesn't know
 
OP
OP
Kirblar

Kirblar

Banned
Oct 25, 2017
30,744
Psychonaut said:
This has always been my fundamental issue with capitalism.

Also, as much as I abhor all of that guy's policies, it's funny that this is the only one that has directly affected me. I'm still doing laundry at my mom's place because machines are so damn expensive right now.
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Adam Smith would agree.
People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices. It is impossible indeed to prevent such meetings, by any law which either could be executed, or would be consistent with liberty and justice. But though the law cannot hinder people of the same trade from sometimes assembling together, it ought to do nothing to facilitate such assemblies; much less to render them necessary.
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