“China, which views democratically governed Taiwan as its own territory, detests Lai as a “separatist”. Lai and his government reject Beijing’s sovereignty claims, saying only Taiwan’s people can decide their future.
On Thursday at his keynote national day speech, Lai said the People’s Republic of China had no right to represent Taiwan, but that the island was willing to work with Beijing to combat challenges like climate change, striking both a firm and conciliatory tone, drawing anger from China.
The Saturday announcement from China’s commerce ministry could portend tariffs or other forms of economic pressure against the island in the near future.
China’s Taiwan Affairs Office, which on Thursday said that Lai’s speech promoted “separatist ideas” and incited confrontation, responded to the announcement by saying the fundamental reason behind the trade dispute was the “DPP authorities’ stubborn adherence to the stance of ‘Taiwan independence'”.
“The political basis makes it difficult for cross-Strait trade disputes to be resolved through negotiation,” it added.
In May, China reinstated tariffs on 134 items it imports from Taiwan, after Beijing’s finance ministry said it would suspend concessions on the items under a trade deal because Taiwan had not reciprocated.
The Cross-Strait Economic Cooperation Framework Agreement (ECFA) between China and Taiwan was initially signed in 2010 and Taiwanese officials had previously told Reuters that China was likely to pressure Lai by ending some of the preferential trading terms within it.”
Sanctions against Russia made their ability to wage war weaker than it otherwise would have been, but only had limited effectiveness due to poor execution and other powers not going along.
“Ukraine has said it will not extend the transit agreement with Russian state-owned Gazprom in order to deprive Russia of profits that Kyiv says help to finance the war against it.
Moscow’s suspension of gas for Austria, the main receiver of gas via Ukraine, means Russia will now only supply significant gas volumes to Hungary and Slovakia, in Hungary’s case via a pipeline running mostly through Turkey. In contrast, Russia met 40% of the European Union’s gas needs before Moscow’s 2022 invasion of Ukraine.”
“Start with that $30 toaster made overseas. Now, slap a 10 percent tariff on it, so that consumers must pay $33 to buy it. That means the Treasury Department collects $3 in new revenue, but it also means that domestic toaster-makers can sell their wares for $32 and undercut the imported models.
If tariffs cause consumers to switch to those domestic-made toasters, Cass acknowledges that consumers are out two bucks. This is what economists call a “deadweight loss” and it’s one of the major reasons why tariffs harm the economy.
Cass, the head of American Compass and a prominent proponent of the conservative moment’s shift toward central planning, wants to focus on the benefits of those higher prices. “The share of the $32 purchase price that would once have gone to a Chinese factory and its workers now goes to an American firm and its workers instead,” he argues. “It pays American taxes and supports American families in American communities.”
All of that for just $2 more. Wow, what a great deal!
Unfortunately, Cass is wrong about the math and wrong about the underlying economics.
Tariffs can, of course, be used to make foreign-produced goods (like toasters) more expensive. That doesn’t mean that manufacturing firms will radically redesign their supply chains to produce more toasters in the United States. And if they did do that, those new toasters wouldn’t cost a mere $2 more than the ones available at Home Depot now. Cass is making several wild logical leaps here, and offers no evidence to substantiate this claim of a hypothetical $32 American-made toaster.
How much would that toaster actually cost? More than $250.
That’s the figure offered by Ed Gresser, the former assistant U.S. Trade representative who is currently the director of trade and global markets for the Progressive Policy Institute (PPI). Unlike Cass, Gresser understands how tariffs and trade work.
More importantly, he also shows his work. Because there are no kitchen appliance manufacturers making toasters in the United States right now, he examined the prices of toasters made in other wealthy, western countries like Italy, Japan, and the United Kingdom. At the lowest end, those toasters cost the equivalent of $250, and some would be significantly pricier.
“In sum, ‘developed’ high-income countries do make home toasters. But they are profitable at prices about ten times those you’d find in mainstream U.S. retail outlets.,” writes Gresser. “So to achieve Vance’s apparent goal, mainstream toaster prices would probably have to rise to Neiman Marcus levels, say $300 each.””
…
“there would be far more toaster-buying consumers than toaster-making workers—and the consumers would be far worse off. Indeed, the workers would be worse off too, since they become consumers as soon as they clock out for the day.
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“Now, imagine what would happen if you told them that the price of jeans would have to increase tenfold, as would be the case with toasters. I suspect that Cass—and Sen. J.D. Vance (R–Ohio), who is making a version of this same argument on the campaign trail—is relying on faulty math and bad economics because he’s aware that the real numbers would be unpalatable to just about everyone.”
“When asked why Harris has not distinguished herself by opposing these measures, Lincicome notes that supporting tariffs is just part of the “conventional wisdom in Washington today” even if polls may not completely support this assertion. “The view among the political experts is that elections are won or lost in a few places with a few votes,” and those critical “voters like tariffs.”
Given the IMF’s projections, bipartisan support for tariffs could lead to increased costs and slower economic growth for Americans regardless of who wins in November. ”
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“former President Donald Trump floated a specific 60 percent tariff on Chinese goods alongside a 10 percent across-the-board tariff, which he recently increased to 20 percent. “It’s just what he thinks galvanized an audience,” Scott Lincicome, vice president of general economics and Stiefel Trade Policy Center at the Cato Institute, tells Reason. “Let’s face it, none of this has any rigorous econometric modeling behind it, so it could be as simple as he thinks 20 percent sounds better.”
“Taking the candidates at their word, you would have to say that Trump’s tariffs would be orders of magnitude worse than what Kamala Harris might do, or say she will do,” Lincicome adds.”
The U.S. trade deficit is a problem, and the best way to solve it is by a weaker dollar. Free trade is good, broad tariffs are bad, and the trade deficit is best dealt with by a weaker dollar.
“The Chinese factory charged me $10 for a cart that cost them $9 to manufacture. U.S. retailers bought it from me for $15, then sold it to consumers for $30.
To recap: The factory made $1, I made $5, and retailers made $15, minus freight and U.S. tariffs.
The freight costs went to shipping lines, U.S. railroads, truckers, warehouses, and America’s highest-paid union workers—longshoremen at the Port of Los Angeles. As for those tariffs: Do the Chinese actually pay them, as former President Donald Trump claims? That would be illegal, as U.S. Customs charges tariffs only to the “importer of record,” which must be a U.S. entity. The monies collected go directly to Uncle Sam and retailers add them to their cost of goods, as with any other expense.
So each Magna Cart created $21 in profits, of which 95 percent went into American pockets. Selling 5 million carts meant a $100 million gain to the U.S. economy. Yet the official trade statistics framed that as a $75 million addition to the trade deficit.”
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“Wouldn’t American profits be even higher if these things were made in the U.S.A? That’s a big no, because many products simply wouldn’t exist. My original plan had been to manufacture in the United States. Then I saw the factory quotes, and I realized my babies would have to retail for more than $100. Thanks to China, tens of millions of Americans can now carry their chairs and gear to the beach with ease, and move heavy loads without tweaking their backs for under $40. (It used to be $30. Sigh.)
So why can’t we move all that manufacturing to other low-wage countries? Because only China has the massive workforce (800 million strong), the infrastructure, and the natural resources to supply 380 million Americans (plus 7.6 billion others globally) with every gizmo and gadget imaginable.
The nearly $500 billion that America imports annually from China enriches our economy by trillions. The math is so simple, you’d think even politicians could understand it.”
“Check the U.S. Constitution, and you’ll see that Article 1, Section 8 clearly gives Congress sole authority over “Taxes, Duties, Imposts, and Excises.” Unfortunately, Congress traded away much of that power during the 20th century, beginning in the aftermath of the Great Depression—which was considerably worsened by a series of tariffs passed by Congress—and continuing with various laws passed in the 1960s and 1970s, as the Cato report details.
In theory, handing over those powers made sense. Lawmakers were more likely to be influenced by parochial interests and would favor protectionism that benefited some local industry, even if it came at the expense of the nation’s economy as a whole. Presidents, it was assumed, would take a more expansive view of the benefits of trade and would use those powers to reduce barriers like tariffs.
For a long time, that was true. It no longer is. Both Trump and President Joe Biden have favored protectionism, and have faced scant opposition from Congress or the courts.
If Trump returns to the White House in 2025, he would assume huge power over the flow of goods into the United States “without substantial procedural or institutional safeguards” due to the “broad and ambiguous language” included in many of those trade laws passed decades ago, Packard and Lincicome write.
The tariffs that Trump imposed during his term in office took advantage of many of those same powers.”
“the four most prominent politicians in the country (sorry, Tim Walz) agree: U.S. Steel, a private company, should not be allowed to conduct a transaction with another private company unless the federal government agrees.
This is absurd—particularly because the deal is obviously in the best interest of U.S. Steel.
“We’ll admit that the competition for the dumbest economic policy is fierce these days—with prices controls on food, a 10% across-the-board tariff, and national rent control on the table,” opined The Wall Street Journal’s editorial board this week. “But opposition to the Nippon deal deserves careful consideration for this distinct dishonor given the deal’s manifest benefits and nonexistent harm.”
Indeed, Nippon’s plan to buy U.S. Steel gives the legacy steelmaker something that Trump’s tariffs and Biden’s blather about blue-collar jobs never could: A chance to actually become more competitive in the global marketplace. Among other things, Nippon has promised to invest $2.7 billion in revamping U.S. Steel’s plants.”