Trade with China
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I'm okay with this. The Chinese have for too long had unfair business practices and frankly, we need to move some manufacturing back to the US.
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This is one of the few areas where I think Trump was attempting the right thing, though I disagree with his process.
From my perspective, it looked like he jumped head first into a trade war. No warnings, no negotiation, no grace period to allow manufacturers to develop a local presence... Or if there was any of that, it was all very quiet.
Granted, I'm no ambassador or industry expert, so I could be wrong, but Trump also doesn't seem to do much quietly.
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@cobrajoe It definitely hurt my sister-in-law's new business (10%, then 25% tariff with basically no warning). She sells purses, and there's basically no production facilities left for stuff like this in the states, unless it's very high end. They're surviving, but it hasn't been easy.
And to be clear, tariffs are taxes.
I don't know what the right solution is for dealing with China.
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@davesaddiction I know our company saw some cost increases too, but I'm not sure how much that affected the bottom line (our engineering group is pretty separated from the accounting group).
I would imagine that large changes like moving manufacturing back to the US while encouraging intellectual property rights and worker's rights in China would be better served by a longer plan, and maybe even a large consortium of countries.
Perhaps a better idea is a "slow boil" policy of increasing tariffs by .5% per year for goods made in China and sold in the US combined with government backed loans for developing factories on US soil or a "locally manufactured" tax break.
That would give incentive to move or find manufacturing in the US while also leaving time to accomplish the move. Then, if China agrees to start legislation to improve conditions, the tariff increase could be stalled or walked back down. It still would increase the cost of goods, but it would be small increases over a longer period of time.
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The best way to stop China is the TPP. It was specifically written to exclude China.
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This is an area that long needed work before Trump took office, and arguably still does. Someone had to come up with a better strategy to deal with China economically. China had a pass to do some sketchy stuff when it was still seen as a 'developing economy'. It's no longer an impoverished nation with little industry as it once was. To me that means we have to get China to play along with the standards of fair trade elsewhere, but how? I don't have a great solution there, and I don't like all the methods used by Trump, but I do give him some credit for taking on the issue.
What would be better than the protectionist tariffs? I'm not entirely sure. Tariffs can be enacted unilaterally, so the president can just make it happen (I'm a bit fuzzy on the role of congress here). It seems like some cooperative effort with other nations is needed to sway China. The US is a big market, but we aren't everything. China can go elsewhere and often has.
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@just-a-scratch said in Trade with China:
This is an area that long needed work before Trump took office, and arguably still does. Someone had to come up with a better strategy to deal with China economically. China had a pass to do some sketchy stuff when it was still seen as a 'developing economy'. It's no longer an impoverished nation with little industry as it once was. To me that means we have to get China to play along with the standards of fair trade elsewhere, but how? I don't have a great solution there, and I don't like all the methods used by Trump, but I do give him some credit for taking on the issue.
What would be better than the protectionist tariffs? I'm not entirely sure. Tariffs can be enacted unilaterally, so the president can just make it happen (I'm a bit fuzzy on the role of congress here). It seems like some cooperative effort with other nations is needed to sway China. The US is a big market, but we aren't everything. China can go elsewhere and often has.
That's what the TPP is supposed to do.
One example: soybeans. China used to buy lots of soybeans from us, but with the tariffs, they stopped. Brazil cleared out a huge swath of rainforest to grow soybeans on. Started a huge fire at the time.
One US ship tried to race their boat to China to make it just in time before the tariff was implemented. They didn't make it in time to beat the tariff.
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@davesaddiction There's quite a few textile manufactures in the US for packs, plate carriers, and various other gun/military related items. Same basic machinery and skills as making purses. Difference is purses have a much higher markup, and people would start to realize you're just paying for a name. I still have a pack from Eagle that was made in Missouri, I believe.
