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The tariffs are being paid by Americans. Why is that a surprise?
(discuss.online)
Video and source: https://xcancel.com/dieworkwear/status/1951851958559703117#m
The logic of protectionism is that then more Americans find work manufacturing these things, which would in turn increase the standard of living.
There is no doubt that the US population fared best, when most of the economy revolved around manufacturing and Chinas rise of the middle class has been the result of manufacturing being offshored from countries like the US and in the EU, coinciding with a downfall of the middle class in the respective countries.
Don't get me wrong. I don't think that we would be able to get back to these "good old days" (in economic terms, not in other aspects) with the tariff regime of Trump. Also onshoring of manufacturing only can do so much if a factory that used to employ a thousand workers now brings the same output with a hundred workers because of higher automation.
As long as the distribution of wealth and return on capital is not changed fundamentally, we will not get back a broad middle class enjoying economic security.
Was that back when the top marginal tax rate was over 90% and the effective corporate tax rate was over 50%?
I wonder why the population fared best back then... Oh well, I guess we'll never know. It must have been due to there being manufacturing jobs, right? Yeah lets just say that.
This was only true to the extent of the profit margins for manufacturing.
Higher margin industries leave more wealth/money to spend on life quality. If your standard of living costs more than manufacturing will support, you'll need to downgrade.
Software, design, innovation, capitalism, high tech all have much higher margins than manufacturing. Silicon valley, and other tech hubs will be impoverished by switching to manufacturing.
What industries are less profitable than US manufacturing? Which of them can be dispensed with?