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this post was submitted on 29 Apr 2025
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I don't disagree with you in principle. But in practice, at 145%, I don't see how this wouldn't turn into an extremely disruptive event for the importing company.
Let's say, for the sake of argument, that the profit margin on Chinese product A is 150%. Even if, in theory, the whole tariff can be supported by the company, that would be very unlikely to happen, as the YOY results would kill its numbers, leading to lower guidance, falling share prices etc. The more likely scenario is that at least a part of that will be passed on downstream and will eventually lead to higher prices for the consumer.
There are probably US importers out there that got used to making like bandits on cheap Chinese imports topped off with huge profit margins, but how big would those have to be for the company to be able to absorb the impact? 300%? 500%? And even if they're able, the temptation of passing some of the cost downstream is going to be there. After all, they have the perfect excuse.
As for the Chinese e-commerce giants (AliBaba, Temu etc.) , they don't even bother, the full tariff costs are applied to the purchase for every US order. So let's not include those.
Now, I can see you have an above average understanding of economy. Do you disagree with the above? I have been arguing your points in good faith, I hope you'll offer me the same courtesy.
145% tariff is effectively a trade embargo. The only good that will be imported are of strategic nature... Ie medical supplies.
People will have either substitute or out right forgo consumers goods.
As I noted above I dont even disagree that end customer will eat part of the cost. My thesis is that we got brain dead normies running around repeating the cropotate thesis:
When the nuance is brought to light, the normie has a melt down. You can check my comment history. this ain't the first thread.
I don't under why modal Lemmy is so opposed to the concept that this will hurt corpos profits first.
Let's imagine that it does hurt corporate profits first. Will they survive? Probably the big ones, might be a bit harder for little ones. So the world keeps turning, right? But like you said the end customer will eat some of the costs, so we agree that prices will go up in the end.
Where's the upside? More money funneled into the government? Paid by the increased prices for the consumer, or some dips in corporate profits?
I'm not sure that's a win for the ~~consumer~~ normies.
US is good sufficient and mostly energy sufficient although we have oil mix and refining capacity mismatch.
The win is they will consime less plastic trash while paying higher prices for goods that they actually need. Less trash, they will value more of what they buy.
For me personallly, seeing these corporate proift wiped is enjoyable after half a decade of price gouging.
Second hand markets will get a boost too.
But the bigger point I am making is how idiots are shilling corporate agenda they internalized it so strongly to where it turns into melt downs
I'm not sure who you mean is shilling for corporations, but that's certainly not the vibe I got from most of this thread.
It would be nice to see corporate profits wiped, especially after so much price gouging we've had to endure.
But why do you think that gouging will stop?
I am positting that price gouging has already hit peak and tariffs will limit corpos ability to price gouge.
They barely pay income taxes, they will pay have to pay some of these tariffs from their profits at the very least. A suggestion that led to the melt down in this thread from mean Lemmy.