Guest post: Other markets, other customers

Originally a comment by Your Name’s not Bruce? on Prank.

Will nobody tell Trump how tariffs work? He’s under the impression (or giving the impression) that the countries he’s targeting with these tariffs are going to pay him for the privilege of selling in the US. Canada isn’t going to pay a dime; it’s US customers of Canadian goods who are going to be stuck with the bill, or needing to scramble to find alternate sources for the products we can sell more profitably elsewhere. Trump seems to think that, like some hoity- toity credit card with exorbitant annual fees, we’ll pay through the nose in order to be permitted to bow and scrape our way back into his good graces.

“It’s going to be very costly for people to take advantage of this country. They can’t come in and steal our money and steal our jobs and take our factories and take our businesses and expect not to be punished,”….

Wait. We’re talking about trade, right? Where does the “steal our money” happen? Are these countries shoplifting on a massive scale, stuffing their diplomatic bags with items they’ve pinched from Walmart? Traditionally, tariffs were used to protect domestic production from foreign competition. But what if there are few (or no) domestic producers left to protect? What’s the point? As for “stealing our jobs” and “taking” factories and businesses, wasn’t it American companies moving to those countries? Are they not permitted to do that? Isn’t it the goal of corporations to seek out the cheapest source of labour, the least regulated and profitable locations for their facilities? This corporate strategy has been used to roll back wages and working conditions in a race to the bottom. This is how the game is played, and if it were going in Trump’s favour, he would have no problem at all with it; he’d say he was “winning.”

Corporations have no loyalty to anything but profit; this is a stance which Trump should appreciate, as he follows it himself (albeit, given his record, with limited success). Taxing the corporations that claim to be “American” while doing all of their manufacturing overseas would make more sense. Fighting for a level playing field internationally in terms of worker pay, environmental protection, and carbon pricing for shipping would, in the long run, make a lot more sense and make the world a better place for everyone. But that’s not what Trump wants. He wants obedience and gratitude, and he doesn’t care how many Americans have to suffer until he gets it. Good luck with that. The US isn’t in a position to dictate in this way any more. Trump can’t make anyone trade with him if they don’t want to. Beating with the tariff stick won’t really help. It might be awkward or difficult, but the world can bypass or ignore the US much more easily than in the past. There are other markets, and other customers.

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