US import tariffs on steel, aluminium: India hits back, to suspend concessions on 30 products

originally posted by: maddy21


Supply, Demand and affordability. Demand depends on the affordability

That's not accurate. Price is directly proportional to demand and inversely proportional to supply. Price does not determine demand.

If I'm building a 100 unit apartment complex, I demand 100 shower heads, whatever they cost. I don't just buy 50 because they are expensive and I don't buy 1000 because they are cheap.

The US demands X tons of steel, whether we produce it internally or import it. That hasn't changed.

-----------

What I don't understand is, if American tariffs are bad for America, aren't Indian tariffs bad for India? Same for China, Canada, or anyone else. If the US puts a tariff on Indian steel, that tariff is paid by the American importer and eventually the US consumer. The tariff money goes to the US government. So why is India affected at all? It doesn't cost them any more to produce the steel, they sell for the same price, their profit margin doesn't change. Why do they feel the need to "retaliate" with tariffs of their own? It's the same result: Indian importers pay more, pass the increased cost to Indian consumers, and the Indian government gets the money.

If these tariffs help the Indian economy, why didn't they enact them before? If these tariffs don't help the Indian economy, then that's not a very effective "retaliation."

The purpose of US tariffs on steel is to make domestically produced steel competitive with imports. Eventually, it should make the US less dependent on foreign steel and produce jobs in the US. Yet, other nations view this as a first strike in a trade war. Do they want the US dependent on their steel? Are they opposed to Americans having jobs? Is that why they are willing to engage in a trade war, even if it hurts their own economies?

a reply to: VictorVonDoom

It effects the exporter in the fact that we will import less of their product in favor of our own. But you are right that the importing company pays the tariff, just that the importing company is often the exporting company as well.

Now if you had to be a US business to import into the US, then other than diminished sales there would be little effect to exporting companies. Firearms were an exception in that imports had to go through a US company interarms was a big player up until the 1980’s. Restrictions on what was imported is why the Walther PPK could not enter post 1968 gun laws and was changed to the PPK/S which is slightly larger to accommodate one additional round of ammo to meet those restrictions. Now they are all made in the US under license and could be the original PPK again but would have to compete with itself for the extra round.

Aren’t trade restrictions fun?

Personally, I won’t be missing any of my “Made in India” products. Retaliate away I will be just fine.

originally posted by: Ahabstar

Aren’t trade restrictions fun?

I guess they must be. Maybe that's why all these other countries had tariffs on American goods before Trump put tariffs on imported metals.

Here in Michigan they are going to enlarge the Soo locks for yet bigger freighters to haul iron ore. $$$$$

a reply to: VictorVonDoom

All goes back to the East India Tea Company paying a higher tax for exclusively to sell in the US Colonies and skip the buying and selling on the London market first. Result was of course the Boston Tea Party from higher prices on tea here because the London tea cost more to the local importers from the extra logistics involved, East India paid the price despite being the cheaper tea in the Boston market.

Tariff dont create jobs. In fact they usually have an inflationary effect and stifle growth

digg.com...

The Tariffs Will Affect Prices Of Everyday Items

The US is heavily reliant on foreign steel and aluminum for the production of everyday items. 90% of aluminum used in the US comes from other countries, while a third of steel used domestically is sourced from abroad. The tariffs will undoubtedly affect prices of everyday items.

Both metals are crucial raw material for autos, airplanes and appliances made in the United States. The construction, oil and utility industries use them for beams, pipelines and wires, as well as cans for food and drinks... The tariffs by themselves will probably make ordinary items produced with aluminum — think beer cans and baseball bats — more expensive, assuming the companies that make them decide to pass the cost of the tax on to customers. History shows that's generally what happens.

The Move Could Slow Growth And Jobs

The new tariffs may save some jobs in the US steel industry, but they are also likely to slow economic growth and eliminate jobs in industries that rely on steel and aluminum.

If other countries hit core U.S. industries such as aerospace, that would ding growth. American consumers, the driving force of the U.S. economy, could also get angry if prices of many items jump... the jobs saved in one industry could be offset by jobs lost in other industries if prices rise and buyers dry up for items such as cars. Former president Barack Obama put a tariff on Chinese tires in 2009, but it backfired, many economists say. Obama touted the 1,000 jobs saved, but the Peterson Institute says that more than 3,000 jobs were lost in other industries.

a reply to: Isurrender73

If the entire planet tries to gang up in a trade war with the US they will lose. Their economies will be hurt while the US economy will grow exponentially

How does increasing the price through tariffs or reducing imports through import quotas grow an economy? Increased prices due to less competition from outside suppliers leaves less spending money in the US consumers pockets

Where is the demand going to come from?

a reply to: Isurrender73

If we stop importing something that Americans want it won't take 15 minutes for someone or several someones to come in and figure out how to supply the demand.

And unless that factory is ready to roll out those products at the price that the imports were coming in at it will have an inflationary effect. Any short term gains ie improved employment will be offset by inflation.

originally posted by: TheConstruKctionofLight

Tariff dont create jobs. In fact they usually have an inflationary effect and stifle growth

Then why did other countries have tariffs on US goods in the first place? How are "retaliatory" tariffs helpful? Wouldn't it be best for the exporter to just ignore tariffs placed on their goods?

a reply to: TXRabbit



What is 4, Alex, plus 1 for some foot problem, it wouldn't be Athlete's Foot unless having the Butler change You into Your warm slippers counts...

Drumpf to Bankruptcy is what Dave Rockefeller is to 'donor hearts'.

At the end He'll dwerp; dwerp, blame it on Obummer and tweet "I only added $3 trillion to the debt, thanks for winning!.."

originally posted by: Metallicus
Personally, I won’t be missing any of my “Made in India” products. Retaliate away I will be just fine.

Remember this when it gets down to the 'Spices'...

a reply to: TheConstruKctionofLight

If we were a small nation with few internal suppliers, like in the EU, it would be a problem. However, in the US we have enough competitors that the price will be based on these competitive factors apart from any sort of monopoly.

The cost of manufacturing goods in the US is greater than manufacturing overseas due mostly to wage disparity. Which is why our jobs were shipped overseas to begin with. Some goods will likely cost the consumer more.

But the positive far outweighs an inconvenient negative. The possitve difference will be the total number of consumers increases as the manufacturing jobs return to the US.

As an individual you may experience a cost increase on certain goods. But as a nation the more revenue generated from within will result in a larger tax pool which can be used on infrastructure.

Currently our trade deficits plus corporate overseas investments and our hospitality to every nation that recieves US aid is keeping trillions of dollars out of US workers hands, while not generating tax revenue.

The idea is to keep US currency circulating in the US. Currency is only valuable to society if it is being spent at or near the same ratio that it is being earned.

Some savings is good but Trillions of dollars sitting overseas being hoarder by the 1% is impacting inflation more than any impact fixing the trade deficit will have.

To the US citizens in this thread. If you are only worried about yourself this may have a slightly negative impact on you. If you are worried about the strength of our nation then you should support Trump's trade policies even if you disagree with everything else.

originally posted by: maddy21
At the same time it will also make everything else more expensive.

A little more expensive, but remember much of that lower rate from other countries is subsidized by the Government there to uncut true prices in the hopes of driving out competition in the future, then they can charge what they want.

a reply to: VictorVonDoom

exporter to just ignore tariffs placed on their goods?

Well they cant just ignore them as it is an uneven playing field. Then theres subsidies, import quotas, manipulation of markets etc

a reply to: Isurrender73

That larger tax pool you speak of will not be spent on infrastructure and the like, the money will line the pockets of those running this crap shoot. You have far too much faith in our elected leaders to do the right thing.

a reply to: Isurrender73

Tariffs still benefit mainly the Government as it is a penalty. Bear in mind that initially the Govt gets the money. You hope that gets filtered done to the consumer or the corporation in the form of tax relief. Knowing that Govts live beyond their mean you can see the dilemma.

Some savings is good but Trillions of dollars sitting overseas being hoarder by the 1% is impacting inflation more than any impact fixing the trade deficit will have.

Inflation is a creature of the Govt by their control of money creation.
Inflation is used by Govts to pay down todays debts in tomorrows dollars thus funding for example social security programmes in the future.

We are led to believe that our demand creates inflation and then interest rates go up. The only winners are Banks who create money out of thin air.

China is the largest producer and consumer of steel.

China spent decades ramping up its raw steel production capacity. (Some of the production facilities are extremely crude by western standards; I know of a coal fired steel furnace in the Northwest of China that was coal fired, and supplied by a railroad using coal fired, steam locomotives, in 2008.)

The thing is, China's steel economy is maturing; demand for raw steel is reaching the top of the S-curve. Which means that they have all this capacity that isn't really needed. So China is dumping steel on the global market. It is hurting all metal producing nations, especially Germany and India.

The steel industry hides what's going on by conflating "raw iron" and "steel products."

With respect to US/Canada trade, they also conflate the border-crossing of partially fabricated products, using automakers' shuffling of production on both sides of the line, to disguise what is happening. Things like automobile components may cross the border up to 14 times before final sale in the USA.

Basically, Canada produces very little raw iron; same with Mexico. Canada shows up as importing loads of 'flat steel' from the US, and then exporting more finished products, like auto chassis and heavy equipment. The raw iron is imported from Mexico or directly from china to the eastern seaboard---its cheaper to ship a tonne from Shanghai to Eastern Canada than to the west coast and then by rail cross-continent.

The other big import product is pipe from china, which is critical for the US & Canadian petroleum sector. A lot of pipe listed as "produced" in Canada is actually only cut and threaded there. Pipe is treated as a separate industry, and not listed with steel in national im/ex figures.

a reply to: TheConstruKctionofLight

Actually the primary cause of inflation comes from the banks which are private not government entities. Usury guarantees inflation and an unstable monetary system.

More money in more hands can lead to a temporary inflationary period as the supply catches up to the demand.

Money that is taken out of the economy through trade deficits and offshore banking also causes inflation because there is either less money to go around or more money must be printed.

These are the main causes of inflation. Historically inflation is at it's worst when governments don't properly regulate the banks and corporations. Regulation is the only way to keep the greedy from destroying the monetary system.

originally posted by: Subaeruginosa
a reply to: network dude

Yeah, that's kinda a logical theory, to rationalise Trumps recent irrational behaviour... His throwing the American people into the deep end, hoping they'll learn how to swim, before they drown.

Question is though... Do you personally think it'll work?

AND this is the scam ..... Throwing American people under the bus.... lol

A leftist approach to spreading lies.

USA already has a HUGE deficient with China so trade war means 0/0 with no winners?

Wrong..... American wins .... no increased deficient trading..... BUT China does loose .... no increase .... simply 0.

Keep the trade wars going ...... America can only win from it by controlling the trade deficient.

China, EU and Canada will be crawling back to the table..... they will be losing NOT America.