LogFAQs > #897515330

Here is how this has played out in the past.

American manufacturers need the steel and aluminium to make their widgets. The US does not produce enough steel and aluminium to meet the manufacturers demands so they import what they need. Now the price of steel and aluminium from off shore has just gone up, this is supposed increase demand for US made steel. Didnt I just say that the US doesnt produce enough steel? So the imports will continue and prices will rise.

If US steel production does increase it is only because the inefficient US production factories now become viable due to the higher prices. This only continues to force prices up.

But if the tariff forces the price of raw materials too high for the widget maker, guess what happens. The whole widget factory moves to China. Because while there is a high demand on steel, there isnt on complete widgets.

Donald Trump seems fixated on trade deficits and considers them a bad sign. I thought Mr. Trump went to school. I would love to hear his answer to this: If a country consumes more goods than if could ever possibly produce, where are these goods supposed to come from?

The USA must run trade deficits with most of the world if it plans to maintain its high standard of living. There is no way to avoid that.

Simple math. Your country produces X, but consumes X plus Y. Then Y must be imported.

Yes the USA could raise some production but dont they have almost full employment now? Baby boomers are retiring and there's a shortage of skilled workers in America. America isnt having enough babies. So where do the new workers come from?
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