Oddbean new post about login | logout I’m torn on the tariffs. I see the ‘why’. The goal is to onshore the manufacturing. We need that for self-sovereignty. “Not your keys, not your coins” resonates. Well, among nations, “not your manufacturing, not your ability to defend yourself”. Plus the outflow of wealth. Tariffs are a hard and undesirable short-term ask. And they have a long and hard path to desired result. It’s a painful low time preference move, but who knows if it’s the right nationstate lever to pull or not. Are there others? More passive and graceful ones? In UX I lean toward “path of least resistance” improvements. But this doesn’t mean I create resistance on the undesirable user flow. I just make the desired path better and I let the migration of feature usage prove me correct. Tariffs are “adding resistance”. What is the graceful way of inviting the desired change vs pushing away from the current undesired practice of offshoring our manufacturing and draining aggregate wealth?
Free-market economics, locally. An outsourced global manufacturing hub is resulting in political pressure being extorted in order to further extend dominance, allowing dependance to take root. It may be a simplification but I imagine that like with UX, we now see trends where the path of least resistance is not what we want or need anymore. Do people actually know what they want and need? Consumer/ developed nations would be actually doing okay by dealing with the challenges of not being able to buy so many finished goods, running trade deficits fueling political tension. If a nation can achieve food security and maintain defence, the enxt logical question should be what can it produce and develop for its own neeeds. Protectionism might be spun as an ugly word, but it's a reaction to a mirror-image of itself.
First, trade is between individuals, not nations. Second, there is no such thing as trade disparities. All trades include an exchange of value. Tariffs are another form of taxation and I would like at the subject based on what forms of taxation are more detrimental than others. It's long held by many economists that consumption taxes (sales) are more desirable than taxes on production (income/cap gains). One can easily place tariffs into the consumption category. Any discussions of replacing the income tax with tariffs should be strongly considered. But, to @utxo the webmaster 🧑💻's point, we don't produce as much as we used to. Is replacing the income tax with tariffs even viable? (Those wanting a much smaller government, like me, would say yes, yes, yes!) Pragmatically, they aren't though. A national sales tax might be a far better alternative to both tariffs and an income tax, and have far fewer manipulations of the markets - especially if it includes both services and products. It's a great conversation to be having though and I just hope the right minds are at the discussion table.