
US imposes new tariffs on $200B of Chinese goods - jonbaer
https://www.bbc.co.uk/news/business-45555749
======
Taniwha
I have a sideline building open source hardware, I build and warehouse in
China and sell all over the world .... I don't see these tariffs, I don't send
the US govt money each time someone orders something, I just send stuff by
mail to customers, they're the one doing the importing and end up paying local
taxes in whatever country they live (just as I pay taxes importing stuff here
in NZ when appropriate).

People seem to forget that this is a really just a new tax that's being paid
by Americans

~~~
pizza
Agreed. However do you see the 'retaliatory' tariffs imposed by China? At
least, I hear from US media that China is apparently imposing similar tariffs,
wondering if the categories are similar (or if they even have as large an
impact as the US ones).

~~~
r_singh
These tariffs aren't new to China however. Do import duties ring a bell?
Countries like China and India have been imposing (and raising) them on
various products for many reasons (mostly protecting local industry,
generating employment, etc).

Import duties in the US however, have been relatively non-existent. To give
you an eg: A non local made car that costs $60k in the USA costs $150k++ in
India (and duties make petrol here more expensive too).

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vadym909
Is there a simple chart somewhere that shows what are the old and new tariffs
for the most commonly imported items. I'm just confused with hearing these
large generic tariff news. Something like PCs- was 10% now 25%, Tshirts- was
10% now 50%, etc.

~~~
NTDF9
This looks like something NYT will come up with soon. They usually make pretty
good infographics

~~~
bowmessage
meanwhile other recent tariff deltas available here:
[https://www.usitc.gov/tariff_affairs/tariff_databases.htm](https://www.usitc.gov/tariff_affairs/tariff_databases.htm)

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clay_the_ripper
Can someone explain in plain English what the actual consequence of this will
be?

~~~
village-idiot
Goods that are purchased from China will rise in price. If China decides to
retaliate, and they will, anyone who sells to China will see sales drop and
losses pile up. Since the Chinese are likely to target based on American
politics (think rural red states), the US government will probably step in and
offer emergency loans or cash if it gets bad enough, pushing US deficits
higher.

There will also be some strange third order effects for Europe and other
trading partners, but it’s beyond my skill with economics.

~~~
cdash
China will quickly run out of American exports that they can selectively
(politically) tariff. In fact, they will eventually run out of ANY goods that
they can tariff that are not already already tariffed much before the US does
due the huge trade imbalance.

~~~
NTDF9
But the US has a trade surplus over China in Services exports into China.
Presumably those will get tariffed.

Also, US made products that relied on chinese intermediate products will go up
in price, passed on to consumers.

Those same US products will not be export competitive in other countries
(because input costs increased with tariffs) and thus China can now export to
places that US used to export to.

Trade is not that simple and usually needs negotiations to be win-win.

~~~
cinquemb
"Goods exports totaled $129.9 billion; goods imports totaled $505.5 billion.
The U.S. goods trade deficit with China was $375.6 billion in 2017."

"Trade in services with China (exports and imports) totaled an estimated $75.0
billion in 2017. Services exports were $57.6 billion; services imports were
$17.4 billion. The U.S. services trade surplus with China was $40.2 billion in
2017."[0]

Seems to be an order of magnitude of difference, setting aside possible tariff
rates.

[0] [https://ustr.gov/countries-regions/china-mongolia-
taiwan/peo...](https://ustr.gov/countries-regions/china-mongolia-
taiwan/peoples-republic-china)

~~~
NTDF9
And after the tariffs what do you expect will happen to goods and services
going from the US to China?

~~~
cinquemb
I expect prices to go up (across the board on such goods) in China, and US
companies who are more price sensitive will get hit harder on their upcoming
10k's than others, predictably.

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TheForumTroll
I find it funny and scary that the US think they can win a trade war. The only
outcomes I can see is 1) China wins 2) it ends in war because why the hell
not. Everything the US does ends in war.

~~~
rasz
You dont understand China. Just as one example look at baby formula situation.

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thwy12321
I'm having a surprisingly difficult time finding a nuanced view of these
policies. On the one hand, china is taking advantage of us and is in part
rotting our our middle class and blue collar workers. On the other hand, this
could spark economic turmoil. Can anyone chime in here? Or is this beyond the
scope of economics? (Not to dig on the field, bit we were told NAFTA we be
great, look at the poverty in Mexico as a result.)

~~~
golangnews
The consensus among economists is that it's a terrible idea which will hurt
everyone. Often this sort of trade war is a precursor to real war.

Trade is not a zero sum game.

[https://www.bloomberg.com/news/articles/2018-05-02/economist...](https://www.bloomberg.com/news/articles/2018-05-02/economists-
invoke-great-depression-in-warning-to-trump-on-trade)

~~~
thwy12321
The people enacting these policies (Trump admin) argue that what we currently
have is not trade, given how the Chinese have manipulated the markets, it is a
one sided agreement. Free trade requires both sides not place restrictions on
the others. Would you say this is true? Sometimes I feel like economic theory
is like psychology, it seems real, seems like it has truth, but counter
examples are abundant?

~~~
gonvaled
It's indeed not free trade, since the playing field is tilted massively in
favor of the US, by controlling the global currency.

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gonvaled
This will hasten the move away from the dollar.

I hope that this allows the EU to trade prime matters and other goods in
Euros, since interests are alligning perfectly.

------
joefranklinsrs
This actually looks like the start of the distanglement between the US economy
and the Chinese economy. What will likely happens next (my best guess) is

1.) 40-60 percent of a company’s supply chain moves out of China

2.) China restricting the movement of capital/equipments out of China (similar
to what happened with Korean companies last year)

3.) China growing homebrew competitors to the foreign companies leaving, part
of the ‘made in 2025 in China’ strategy, via state enterprises or state
spendings in startups. China will also make US companies’ operation in China
very hard, either with license restrictions, or increased local ownership.

4.) China will disincentivize Chinese consumers from purchasing US (or
foreign) products. Via propaganda, state media, others. This would be hard, as
Chinese consumers prefer higher quality, higher brand value, and higher
perceived value products.

5.) China will have to target US farmers with tariffs, as there isn’t much US
imports to tax otherwise. Plus, there is the face saving situation.

6.) US will increase the tariff coverage to all Chinese imports, either
triggered by tariffs on US farmers, or any other targets.

7.) China local governments will make a mistake of seizing a US owned
corporate asset, or prevent a factory from shutting down by its owners. This
will escalate the urgency for US companies to move out of China.

8.) 70-100% of company’s supply line will be out of China

9.) Eventually, most direct trades between both countries shrink. Down to a
significant level where it starts to drop gdp for both countries (China way
more than US)

10.) China will have no choice but to embrace its lost decade, ala Japan. It
will tighten controls on its citizens. It will try to contain high inflation
and high unemploment rate. It will try to unwind its debt for the next 10-20
years.

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lpcam33
Is anyone here curious about where the tariffs income will be spent?

~~~
NTDF9
Bailout (buying votes) for more farmers who will lose export markets?

~~~
lpcam33
For me protectionnism could be a good thing environmentally like adhelas said.
It could be a good measure if you use this tariffs to improve equality,
distributing this equally through the population. Sadly nobody knows here the
income will be spent.

~~~
gonvaled
How is equality achieved towards the Chinese workers?

~~~
l_camacho84
By reducing imports from China, China will need to invest in their local
market too and by doing that they will need to improve chinese worker
conditions.

~~~
gonvaled
Great. I hope the EU follows through and reduces US services imports to
strengthen the local economy.

I thought trade was good? Haven't I been hearing that from US officials for
over 50 years?

~~~
l_camacho84
Yes, and in the last 50 years carbon emissions have skyrocketed, while wages
have stagnated. We are depleting the resources of the planet and polluting at
an unbearable pace. We have to change the economy and protectionism for me can
be a good measure. If protecting the environment or health is good, why is
protecting the economy bad? What is the opposite of protecting? attack? If so,
why does protecting something lead to a trade war? should not it be to attack
an economy? This area is full of self-righteous words like "free market" or
"trade war". We cannot question something that is free? And a war is something
that has to be fought at all times? We need to see through this.

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edhelas
Some, maybe dumb, thought.

Imposing tariffs and therefore reducing the goods that are transiting to (and
from) the US across the globe is not, indirectly, ecologically good?

Less goods transiting, less transport to bring them across oceans, less
container ships, less oil…

~~~
gonvaled
This applies to trade in all directions.

Funny how the US has been advocating for trade while it was "winning" (read,
giving worthless papers for real goods). Since now we are hitting a wall
(competing economies asserting themselves, and willing to be freed from the
dollar), and since the US prsident seems to disregard, or not aware, of the
massive advantage that the dollar means for the US economy, a trade war has
been started.

This war will either be won by the US on the short term, or the dollar will be
dismissed as international currency.

~~~
planteen
> giving worthless papers for real goods

> This war will either be won by the US on the short term, or the dollar will
> be dismissed as international currency.

Remind me what the Yuan, Yen, and Euro are backed by? Or are you saying that
the world will go back to the gold standard?

