Eli,
Recently I listened to a CEO of a company that uses steel as an input for a product that is sold globally. The company has two facilities, one in the US, the other in Europe. The CEO was asked about the impact of the steel tariffs on his business. He wasn't sure. On the one hand, steel prices would rise, so he would have to increase the price of his end product. But, he has two facilities. So maybe, he said, he would bid projects with his European facility and avoid the tariffs.
Perfect. Trump increases tariffs to "save" the US steel industry. In this example, however, not only does the consumer NOT buy US steel, but it moves manufacturing to a different country in order to avoid the higher steel prices.
When government interferes with the price mechanism it creates all sorts of perverse outcomes. Like when it artificially increases the price of labor with minimum wages or mandatory paid maternity leave the result is a decrease in demand for the very labor it is "protecting."
Economic ignorance is a true bipartisan accomplishment.
Bill
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