Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Investing

Who Will Report on Tariffs’ Unseen Costs?

by May 31, 2024
May 31, 2024
Who Will Report on Tariffs’ Unseen Costs?

Scott Lincicome

The recent Wall Street Journal article, “Meet the Shirt Maker Who Loves U.S. Tariffs,” is a modern (and frustrating) version of French economist Frédéric Bastiat’s classic parable of the broken window. It praises the “seen” benefits of US apparel tariffs—the handful of American manufacturers whose products have “again become competitive in the global marketplace”—while totally ignoring their many “unseen” costs.

Most obviously, the article refers to the higher prices that American consumers will now pay for clothing as merely something US importers “say” might happen, when in fact we know from recent experience that these costs are real and significant.

According to the US International Trade Commission, for example, the “Section 301” tariffs on Chinese apparel imports—the very tariffs at issue here—increased the price of Chinese apparel by 14.5 percent, the price of US apparel by 3.1 percent, and average US apparel prices overall by 4.3 percent. That’s an invisible tax of more than $3.5 billion in 2021 alone—one that was disproportionately paid by lower‐​income American consumers and that constituted money that couldn’t be spent on other, more productive US enterprises.

Also unseen is the fact that, again per the ITC, the China tariffs resulted in only a modest (6.3 percent, or about $770 million) increase in American apparel production that same year, because US consumption shifted not to American‐​made clothing but other import sources (a 25.2 percent increase in 2021). Overall, therefore, the US economy has suffered yearly tariff‐​related losses more than four times as large as the gains the article cheers—a miserable result that’s anything but surprising given that the same commission in 2017 found that the removal of earlier US apparel tariffs would increase net US welfare by $2.4 billion.

And for what? Suits, t‑shirts, and jeans have no national security implications, so economic losses from forcing their production onshore are not “strategically” justifiable (non‐​China imports notwithstanding). Production jobs in the domestic industry pay as little as $11/​hour and only a few dollars more in New York City, where the Journal article’s chief protagonist is located (and where fast food workers make almost as much). The manpower and other finite resources directed to tariff‐​protected industries also now can’t be used for other, more productive business operations in the region—another unseen cost of protectionism.

Call me a heartless globalist if you must, but the US government shouldn’t be in the business of regressively taxing the clothing purchases of Americans still reeling from inflation, all to support—at a substantial net loss—relatively low‐​paying apparel jobs in the Big Apple. It’s a bad policy, and certainly nothing for a newspaper to cheer about.

0
FacebookTwitterGoogle +Pinterest
previous post
Biden mocked for ‘disturbing’ smile after ignoring question about Trump being ‘political prisoner’
next post
New Medicaid Regulations Unlikely to Improve Accessibility and Transparency

You may also like

A Speaker-less House Does Not Stop the Presidential...

January 3, 2025

Trump’s Tariff Threats a Reminder of the Need...

September 25, 2024

FBI Budget

May 19, 2023

The Digital Euro Divide in the EU

November 5, 2024

Modi Is Down, But Not Out

June 5, 2024

Decriminalization vs. Legalization

February 13, 2024

Business Cases Could Loom Large at the Supreme...

June 24, 2024

The Original Sin of U.S. Health Policy

July 24, 2023

Will Economic Growth Be Short-Lived as Fiscal Challenges...

May 23, 2024

Election Policy Roundup

November 25, 2024

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Trump ally stands firm against ‘big, beautiful bill’ despite pressure: ‘It’ll completely backfire’

      June 8, 2025
    • Rubio condemns assassination attempt on Colombian presidential candidate Miguel Uribe

      June 8, 2025
    • Obama WH physician says Biden doc should have performed cognitive test

      June 8, 2025
    • Trump warns of ‘serious consequences’ if Elon Musk funds Democrats

      June 7, 2025
    • Musk jokes about reconsidering stance on Big Beautiful Bill after Schiff’s praise

      June 7, 2025
    • Musk deletes explosive posts about Trump and Epstein files

      June 7, 2025

    Categories

    • Business (8,152)
    • Investing (2,019)
    • Politics (15,571)
    • Stocks (3,136)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved