[Topspinmo]

Originally Posted by ColdNoMore

What I find incredulous, are the number of people (including those at the very top) who seem to be clueless... as to how tariff's actually work.

If an American importer buys widgets from China at $1 each, but then a tariff of 25% is put on them...it now costs the AMERICAN IMPORTER $1.25 for each widget.

NOT China.

Now the importer has to make one of the following decisions.

1. Eat the increase and sell widgets at the normal price...with the associated reduction in "profit" (selling price minus purchased price, plus overhead of course)
2. Increase widget price a little, to recoup SOME of the tariff they've paid to the U.S. government...while their business absorbs the rest.
3. Pass on all of the cost to American consumers.

Please note that NONE of the importer's choices, has China paying anything...to the U.S. Government.

NOTHING.

In choice #2 & #3, it is the U.S. consumer paying for at least part of the tariff.

Why do so many...not understand this?

IMO What it does is somewhat even the playing field for other sources that don’t have near slave labor and NO worries of government environmental protection. IMO China has the most polluted cities in the world.