Understanding Tariffs.

[Brian Parrish]

The immediate effect is that the American made competitor will win.
If our brothers are saying that we all must pay higher prices, then they are saying there are no made in America alternatives. If so, then that must be rectified immediately.

 

[noonster]

They are our neighbors and relatively good friends (Canada). We have a problem. We asked our friend to help and were told to stuff it. They have a rea; easy way to not get the tarrif bomb: give us the hand that we need. Presto: no extra tarrifs. And they do tarrif the snot out of a lot of our exports to the northland. Eggs, dairy, and much more. They don’t HAVE to pay a whole lot for their defense cause they are our neighbors. And yes, they do have to pay for their defense… they also know that we are minutes away (so to speak).

 

[GnarlsR2]

Holy guacamole!!

When you go to war with tariffs, you don't need M4's, Cruise Missiles, or F-22 Raptors!

 

[biku324]

BFD, we buy way too much energy from Canada. Could have much to do with the "recto-cranial inversion" in DC for the past 4 years. It's under our feet, screw the "yellow bellied reticulated snail darter." Joe

Oddly, we produce more than any other country in the world and have 2 years running.

A Second Consecutive Oil Production Record
In 2023, U.S. oil production reached a record high, surpassing 12.9 million barrels per day, solidifying the country’s position as the world’s top oil producer. One of my 2024 energy sector predictions was that the U.S. would set a second consecutive record this year.

According to preliminary data from the U.S. Energy Information Administration (EIA), production had averaged 13.249 million BPD year-to-date through December 13, 2024. Cumulative production for the year is estimated at 4.611 billion barrels by that date—just 110 million barrels shy of the previous annual record. U.S. Oil Production Shattered Records Again in 2024 | OilPrice.com

Then we export it.

Crude exports from U.S. ports have averaged 4.2 million barrels per day so far this year, up a mere 3.5% Y/Y compared to a robust 13.5% growth in 2023. This year’s growth clip is the lowest since 2015, when the country lifted a 40-year federal ban on the export of domestic crude.
U.S. Crude Oil Exports To Peak In 2024 | OilPrice.com

Here's what we import from Canada - note it is nearly the same as what we export.

US imports of crude oil from Canada hit a record 4.3 million b/d in July 2024 after Canada expanded its Trans Mountain pipeline, according to Petroleum Supply Monthly (PSM) from the US Energy Information Administration (EIA). July is the latest month with available data.

The Trans Mountain Expansion (TMX) increased the line's capacity from 300,000 b/d to three times that amount when it began commercial operation in May 2024, allowing more Alberta crude oil to reach Canada's west coast for export. EIA: US crude oil imports from Canada hit record following TMX pipeline expansion | Oil & Gas Journal

Export of US crude was banned from the 70s to 2015, when Congress removed the ban.

Published 1:00 PM MST, October 9, 2015
WASHINGTON (AP) — Defying a White House veto threat, the Republican-controlled House on Friday approved a bill to lift a 40-year-old U.S. ban on crude oil exports. Supporters argued that an ongoing boom in oil and gas drilling has made the 1970s-era restrictions obsolete.

The bill was approved, 261-159, with 26 Democrats joining Republicans in backing the measure that now heads to the Senate, where prospects are uncertain.

House OKs lifting 40-year-old US ban on oil exports | AP News

 

[YeshuaIsa53]

When given lemons, make lemonade.

The differences in costs to manufacture items, per different countries, has a lot to do with many different things. Large manufacturers farmed out large portions of their needs to countries using different rules and regulations than the US 40 to 50 years ago or so. Some of it may have helped to keep the US environment more clean, but the world as a whole most likely lost that battle. Environmental Protection laws vary greatly country to country.

Basic Importing and Exporting | U.S. Customs and Border Protection
Both CBP and the importing/exporting community have a shared responsibility to maximize compliance with laws and regulations. In carrying out this task, CBP encourages importers/exporters to become familiar with applicable laws and regulations and work together with the CBP Office of Trade to protect American consumers from harmful and counterfeit imports by ensuring the goods that enter the U.S. marketplace are genuine, safe, and lawfully sourced.

​​​​​​February 3, 2025: Donald Trump presidency news | CNN Politics

There is more to this than tariffs. Certain countries have limits as to how much tonnage they can export to the US per year. We had to create anti-dumping laws, as the limits were not paid attention to. Whether those laws stopped the dumping is doubtful. There may be much needs tweaking around the world. Maybe the situations around the globe can become more balanced...while we learn more.

 

[444 Magnum]

Most of you are missing the big picture. Trump is a chess player who is thinking several moves ahead. Haven't you heard him repeatedly talking about trade deficits with various countries? That's what this is all about.

In the 1970's, all you heard about was the trade deficit with Japan and other countries. Then the globalists got involved and talk of trade deficits vanished. Globalists think it's the duty of the US to share its wealth with the world. That's what has been going on for at least the last three decades and why our national debt is at an unsustainable amount. Trade deficits give away wealth and lead to more and more borrowing.

That's the end game. Trump is tired of the US subsidizing the world either directly through aid or indirectly through trade deficits at the expense of the US taxpayer.

These recent tariffs have been imposed through the executive branches use of police powers and don't require congressional approval. Tariffs are coming for other countries but they will have to go through Congress and will be an uphill battle based on history.

The tariffs are the first move of many to come to "encourage" fair trade agreements with China, Europe, etc. and stop the hemorrhaging.

One other thing concerning trade with Mexico and Canada that doesn't show up in the trade numbers is military spending. Both of these countries benefit indirectly from the US military protection and spend very little by comparison on their own defense.

List of countries with highest military expenditures - Wikipedia

There are many moving parts to all of this.

Don't listen to everything the big networks tell you.

 

[soFlaNative]

Whatever transpires with the back and forth I've noticed a dearth of "je me souviens" adorning rear bumpers down here, also more and more properties are on the market as Canadians have been taking advantage of the declining value of their loonie along with the rising cost of insurance and property taxes.
I like the idea from a previous post of revisiting this thread in a few years and realizing this was just a tinkle in a thunderstorm.

 

[Model29-26.5]

I thought politics were banned from the lounge?

 

[LVSteve]

Tariff. The tariff is paid to the government and the cost is passed to the consumer.

The consumer is NOT who decided to import products. That was decided by business so that they could make money of by buying and selling instead of manufacturing and selling

Just how are we going to replace these products. Most of the infrastructure to make a lot of it has been sold off by those same businesses. We already have a shortage of labor especially skilled labor. Even if we do start making these products they will cost more due to the higher cost of American labor. As 78% of the population is now living paycheck to pay check, how will they afford higher priced products??? Plus, how long will it take for the US manufacturing to set up to replace imports. It ain't gonna happen in just a few months.

There are 340 million citizens, 58 million are over 65 and 73 million under 18. That leaves 209 million, 2 million are in prison so that leaves 207 million. 11 million are totally disabled (this includes 1 million Veterans). That leaves 198 million. 3 million of those are non working women so that leaves 195 million. There are 1 million active gang members. Down to 194 million. 160 million of those are employed

Ya, it might get rough for working Americans. It will not be one bit uncomfortable for those running the show though

This. There isn't going to be US production to replace tariiffed goods the public see as expensive. There are multiple reasons why.

1) The US public can, and wants to consume far more than the country can produce.

2) We can't produce to meet this new demand because it either cannot be done at a sensible price, or you cannot get skilled workers. For example, the US navy is suffering crippling delays due to shipyard labor shortages.

3) Wall Street really controls the economy and whether new factories go up. If they don't like the current situation, they will only have to wait four years, or maybe even only to the mid-terms.

4) Regardless of whether it's a real number or not, Wall Street and employers in general get twitchy if the unemployment level drops below 4%. It makes the labor market tight, and gives employees leverage.

 

[LVSteve]

We win, new Boss.

“In a post on X, Trudeau said Canada will implement a $1.3 billion border plan and will appoint a fentanyl czar.

In addition, Canada will reinforce its border with new helicopters, technology, personnel and enhanced coordination with American authorities. He added that nearly 10,000 personnel are and will be working on border protection.”

Oh goody. Another highly paid, likely underqualified suit to appear on TV to spout stuff. Just what every country needs.

 

[LVSteve]

The immediate effect is that the American made competitor will win.
If our brothers are saying that we all must pay higher prices, then they are saying there are no made in America alternatives. If so, then that must be rectified immediately.

What US competitor? US manufacturing has been gutted by short-termism on Wall Street and by cheap goods from overseas. I doubt that 10% tariffs on Chinese goods in US stores comes even close to encouraging anyone with money to invest in new plant to produce those goods here. I suspect the same with Mexican made car parts. The difference in labor rates and other overheads between the US and China and Mexico is just too great. What's more, I'm damned sure the administration knows this.

It's pretty clear the tariffs on Mexico and Canada are to put the arm on them for the ills at the borders. It could be argued that this has been a long time coming.

The China tariffs are window dressing for the peanut gallery. Spiking inflation through bigger tariffs on China would likely result in unhappiness for this administration in two years.

As for the US producing alternatives locally, I suspect Wall Street will wait it out.

 

[BC38]

Another knee bent

Canada announces US tariffs on hold for 30 days after Justin Trudeau holds 'good phone call with President Trump'

Seems to me that some of the anti-tariff theorists missed (or chose to ignore) the info linked in post #45.

The THREAT of tariffs is, and has been, a BARGAINING CHIP, one that has been successfully used to gain concessions and leveraged to balance trade, and to negotiate trade terms/agreements that will benefit US.

Rather than bloviating about the theoretical advantages/disadvantages of tariffs, read the linked article above.

The threat of tariffs achieved the desired effect. Canada is going to help us secure our northern border, and that is a GOOD thing.

While there may not be a huge flood of fentanyl and unvetted illegals coming across the American-Canadian border, I read an article a couple of days ago about several hundred kilos of cocaine intercepted at the northern border, and there have been many documented cases of criminal illegal aliens coming into our country from Canada - many of which were CCP operatives.

While it is true that the crisis at our southern border is a much bigger problem than our northern border, we need to secure and defend ALL of our borders from invasion by criminal/subversive elements.

The new administration's threat of tariffs on Canada has convinced our neighbors to the north that it is in their best interests to mobilize and HELP us secure our longest border against illegal invaders. This is a refreshing change from what we have seen under the previous administration.

Sounds like a win to me.

 

[UncleEd]

Wait a year. See what is. Start blame game.

 

[YeshuaIsa53]

At least there is a 30 day rest for some of our importers.

 

[ladder13]

Looks like we will be getting what we need, rare earth minerals from Ukraine. That should help our trade deficit and national defense. Two birds.

 

[Alton]

Migration: The US Has More Than One Border | Wilson Center
The above blog spells out everything that has been happening in Canada and why Trump wants them to secure their border.

 

[ladder13]

I thought politics were banned from the lounge?

It is. Always decided by the Big Kahuna or one of his Generals. When you come online and get that flash on your screen saying you have a PM in your inbox, it sometimes makes your stomach sink.

 

[CAJUNLAWYER]

Seems like it's working, Mexico and Canada folded yesterday. Will be interesting to watch. At this point the main thing I'm worrying about is eggs.

 

[steelslaver]

Again you are WRONG!!!!! Importers can put the cost back on exporter by demanding a reduced price on the commodity. It’s all in the deal you make. This is all finance and commerce 101. Here are the numbers. THE ART OF THE DEAL???? Sound familiar

Ya, ya. Thereis absolutely no way that it will not increase cost to the end consumer. The initial seller will not mar the price down more than the tariff.

The Art of the Deal. Written by someone who got richer while bankrupting companies and letting his suppliers and contractors go broke. Many of them small family business.

 

[ladder13]

So, we can’t use tariffs because that increases inflation. Then we can’t bring jobs back here because we would have to pay higher wages and thereby increase inflation.
So the solution is to keep buying cheap goods from abroad. Is that right?