End of duty-free imports from China to USA

[jwin615]

Just about every country in the world charges tariffs on goods from the USA. Doing a tit for tat would eliminate the need for income taxes. Trump has already hinted at chaging the IRS to the Tariff Revenue Service. Seems impossible but in the early years of the USA,Tariffs were used and the USA was richer than it has ever been in history and there WAS NO income tax.

Can you imagine how much more money you would have without that?

I aced college history....

I mean, robber barrons are in vogue again so...

I fail to see how no income tax and a rise in the costs of all foods and services, raising inflation, there by raising interest rates would equal more money in my pocket. My wages won't increase to track the with the increase of the cost of living, not that they have over the past decade+ anyway.

 

[giovanni]

I mean, robber barrons are in vogue again so...

I fail to see how no income tax and a rise in the costs of all foods and services, raising inflation, there by raising interest rates would equal more money in my pocket. My wages won't increase to track the with the increase of the cost of living, not that they have over the past decade+ anyway.

Yeah that definitely won’t work. It’s really easy to do the math: say you make 100K per year and spend 75k for living expenses, and somebody else makes 800K per year and also spends 90K on living expenses; now if they are both taxed at 25%, you pay $25k in taxes and the other person pays 200k in taxes. Now if you remove the income tax, the wealthy person will get a much bigger break than you but what’s worse, the government will need to make up the 225k in tax revenue somehow. So they will add tariffs on living expenses by putting tariffs on food imports, which you end up paying at the grocery store (China or Mexico won’t pay that. We will). That has to add up to 112.5K per person. So how do you pay that if you only make 100k? With the income inequality we have in this country the math is probably a lot worse than that. Most economists think tariffs are a bad idea for this reason. The math just doesn’t add up.

 

[bean]

I mean, robber barrons are in vogue again so...

I fail to see how no income tax and a rise in the costs of all foods and services, raising inflation, there by raising interest rates would equal more money in my pocket. My wages won't increase to track the with the increase of the cost of living, not that they have over the past decade+ anyway.

I think he was making a joke about the Gilded Age. But, I also got a "D" in history and my high school teacher was an admitted Socialist.

 

[spi]

Seems impossible but in the early years of the USA,Tariffs were used

Let's look at some of the things that didn't exist before income tax:

Infrastructure such as highways, bridges, airports, and public transportation systems, public education, Social Security, healthcare and public health initiative, defense and national security, public safety and law enforcement agencies, fire departments, emergency response services, scientific research, environmental protection, public welfare, housing programs, disaster relief, veteran services, public broadcasting, regulatory agencies such as the FDA and the Securities and SEC, agricultural support, and civil rights protections. I'm sure I'm leaving many things out.

Damn, this list looks like something that the DOGE wants to cut.

But my point is I don't think you can compare now to the economic needs of 1800s US and conclude that we go back to it.

 

[Paradox916]

fire

 

[jwin615]

I think he was making a joke about the Gilded Age. But, I also got a "D" in history and my high school teacher was an admitted Socialist.

Ha! So was mine. More so from a particular period in Europe...
And less "admitted"

 

[Stickman393]

I'll also point out that before income taxes, America was not a particular "world power"

Most folks would point to the 1950's+60's or so as the height of American wealth and dominance. Income taxes passed on 1913, a year before WWI.

I mean, at that point we were like, 50 years out from slavery being illegal. And there's a lot to be said about how that particular practice enriched certain sectors of the country, as unpaid labor will tend to do.

Before income taxes, we didn't even have the federal reserve. Each bank would print out it's own debit notes and you could never be sure that your New York issued dollars would be honored in Kansas, or even if the exchange rate for "dollars" would be the same.

So, folks tended to use gold and silver. Except that required large, heavy reserves and currency production was so limited that it couldn't scale with a rapidly scaling economy.

Not only that, but individual companies started building towns where their workers would live and work, and all their wages would be paid in "scrip". That could only be redeemed at company stores within the town. When profits dipped, the company would raise prices in the general store so folks couldn't buy as much with their wages. They would decrease costs by buying less product for the store. Like a little microcosm of inflation.

Not only that, but before the income tax and federal reserve, there were localized, depression-level crashes like...once every couple of years. Currency was so scarce and banks would over-leverage themselves, then folks would get wise to this fact and try to take all their money out. A bank collapse was devastating, and they would happen with regularity.

America wasn't richer back before those days. Wealthy people were richer back in those days. That was the era of Robber Barons and violent repression of organized labor. People worked 80 hours a week in unsafe conditions and lived horrific, squalid lives.

Nah dude. Nah. Nah uh. Trump says *those* were the good old days? Sure. If your last name was Rockefeller or Carnegie. Everybody else got the shaft.

Quite literally, as it turns out.

 

[tegendemuur]

Makes me think of how Russia's neightbor, Kazachstan, has become an major import/export hub since a few years. :')

 

[jessenator]

all praise the gray market too bad there's no getting around that with our land-border neighbors

 

[darwin999]

A simple but concise view on tariffs.

 

[JTEX]

 

[HamishR]

Blows me away how many folks don't seem to even understand how tariffs work. They think that if you put a tariff on Chinese goods then China pays the tariff.

 

[JTEX]

Americans have been so fortunate for a long time with that huge $800 de minimis. I think they'll badly miss it when they see what it's like to be like us Canadianers with our pathetic C$20 duty-free limit. Or is it C$40 nowadays? Woohoo, TENS of dollars!

Oh, and if there's no de minimis, that means brokerage fees tacked on every little parcel, since someone will always want to get paid for doing the customs clearance paperwork and collecting the tariffs on your behalf.

 

[darwin999]

Blows me away how many folks don't seem to even understand how tariffs work.

Americans have been so fortunate for a long time with that huge $800 de minimis.

Agreed.
Ignorance (i.e., lack of awareness) is driving a lot of policies right now, it's very distressing.
A good rule is that most things are rarely simple, there's almost always much more to the story.
And it's usually unwise to go along until you are aware of the unintended consequences (or at least appreciate that they must be there).

With import tariffs, the simple idea is that they will bring back production to the US (and increase jobs here). Unfortunately, numerous studies of past US tariffs have shown that the dominant result was that companies that already made the product in the US just raised their prices to match the increased prices of foreign manufacturers, to reap higher profits. And very few companies increase production in the US. I.e., if there's a path to easy money, it usually wins. So the end result was simply higher prices for US consumers.

Politics is a lot like the well-known joke about card games - if you don't recognize who the chump is, then it probably is you.