[wyldfire]

> Is this sort of a "if you don't make us pay tarrifs on component X, we'll build component Y in the USA?"

Yes, that would be my assessment.

Here are the criteria used by the US Govt to grant the tariff waiver [1]:

> Whether the particular product is available only from China and specifically whether the particular product and/or a comparable product is available from sources in the United States and/or third countries.

> Whether the imposition of additional duties on the particular product would cause severe economic harm to the requestor or other U.S. interests.

> Whether the particular product is strategically important or related to “Made in China 2025” or other Chinese industrial programs.

[1] https://www.federalregister.gov/documents/2019/09/20/2019-20...

[kerkeslager]

Wow, what an enlightening link.

At first, reading that there's an exemption process, I thought that the bill was better-thought-out than I initially had thought. But then seeing the existing exemptions, I'm realizing that this stinks of lobbying. It's clear that these exemptions are targeted at specific products, and are almost certainly there because some company lobbied to bypass going through the normal exemption process.

[rayiner]

That’s not the bill. That’s from the federal register, which records decisions of administrative agencies. Assuming you’re talking about Annex A, that is a recording of specific products that the USTR has ruled are excluded in response to existing exclusion requests:

> As set out in Annex A, the exclusions are reflected in 38 specially prepared product descriptions, which cover 46 separate exclusion requests.

As is clear from Section C, these are decisions on publicly filed exclusion requests that were the subject of public notice and comment. There is in fact a whole website dedicated to explaining what these exclusion requests are and how to apply for them: https://ustr.gov/issue-areas/enforcement/section-301-investi...

As discussed above, criteria for exclusion are things like products that are only available from China, whether the product is strategically important to China, etc. But the decisions are made case-by-case and that’s why the list of excluded products is literally a list of specific products.

This is just a funny misunderstanding, but a lot of “the government is so corrupt” type ranting is rooted in these sorts of erroneous readings of legal documents.

[kerkeslager]

Thanks for the correction! It seems I didn't understand what I was reading.

[malshe]

> This is just a funny misunderstanding, but a lot of “the government is so corrupt” type ranting is rooted in these sorts of erroneous readings of legal documents.

Great point! I have seen my views change on many things once I started to read up/listen to experts who know the law.

[pergadad]

But the list of criteria itself looks like a lobbying piece. It's not, say, medical products. It's among others products that are part of China's own industrial strategy.

If you are punishing China, why would you leave out the sectors China considers as most important and on which it aims for strategic dominance?

[jfengel]

Presumably, it's because the regulators concluded that these were areas where we'd be cutting off our noses to spite our faces. It's widely thought that that applies to the entire bill, but even aside from that, this is basically what lobbyists are for.

They are representatives from the various American industries, hired to make their case in front of the regulators. The regulators are full-time bureaucrats, who know a lot about the domain at hand but also need to know what particular American companies want. There's no one answer to it; what the bureaucrats do for a living is make judgments about what's needed and what's not.

A big company that hires the best lobbyists (the ones with the most experience and the most contacts) definitely has a leg up, but the regulators aren't solely at their beck and call. (Usually. It's not that regulatory capture doesn't exist, but the vast majority of day-to-day dull grind of government really is just ordinary people trying to make good policy.) Often, small companies band together to hire a decent lobbyist; DC is chock full of organizations with names like "Vegan Caterers of America" and "Society of Diesel Mechanics" that don't have tons of money but they do show up at regulators to make their cases on matters nobody cares about except them.

I'm not really here to defend the system or make the case for it one way or another. It's just that DC works very differently from the way it's portrayed on TV (including the news), in ways that are simultaneously more interesting and excruciatingly boring. I don't have any specific info on this case, but it does sound like exactly the kind of hodgepodge that results from making a lot of little decisions rather than one big sweeping gesture.

[sulam]

Yes, but aren't you glad to know our government is looking out for the live bait and tackle vending machine industry?

[baybal2]

Thanks for pulling that link out. Just look at that exemption list.

Product category description lists look to me almost exactly like rigged state tenders would look like in some post-Soviet country

> LED lighting fixtures, a kind of used in horticulture, containing over 5,000 LEDs spread across 6 light bars

> Grills composed of steel wire, each measuring 49cm by 47cm, weighting 0.36kg

> Power supplies ... measuring 148cm in length, 43cm in width

Those items are pretty much purpose written for individual benefactors

[ajdlinux]

And if you read the Background section, you'll see that this list is the result of a process where the USTR asked for exclusion requests, and companies had to provide the codes of the specific products they want excluded.

"Under the June 24 notice, requests for exclusion had to identify the product subject to the request in terms of the physical characteristics that distinguish the product from other products within the relevant 8-digit subheading covered by the $200 billion action. Requestors also had to provide the 10-digit subheading of the HTSUS most applicable to the particular product requested for exclusion, and could submit information on the ability of U.S. Customs and Border Protection to administer the requested exclusion."

So... it's not exactly a surprise if the list reads like it was compiled for the benefit of individual companies. Because... it was.

[VLM]

Yes exactly but you're reading too much into the intentions.

Lets say there's a tariff to encourage those little bags of screws that home depot sells to possibly come from the USA instead of China, or at least tax the Chinese because they do govt funded product dumping to make the market unfair. Really it doesn't matter why. The point is we want to discourage retail sales of Chinese screws for whatever reason, possibly even valid reasons.

Given the above... if I'm importing screws to build cars, and our govt likes domestic auto production, the govt doesn't want to screw me over with high screw taxes such that people buy Japanese cars instead. What they want is people at home depot not buying little bags of chinese screws, what they don't want is instead of "making" 1 cent of taxes on screws they'd lose 1 dollar of taxes on my electric cars because my cars would be too expensive compared to untaxed japanese cars or whatever.

So I apply for an exemption, but seeing as you don't employ me, so I'm gonna spec "M3-0.5 16 mm long SSHS grade 6 anti-corrosion finish screw". There's no point in me paying my lawyers to get an exemption for "screws" in general, just so that you don't have to pay for an exemption to import screws for your internet connected toaster. I mean, good luck with your internet connected toaster product... but pay for your own lawyers.

It is admittedly kinda silly to try to centrally control large scale industrial operations by taxing material components, why not do social control of operations directly by tax codes for electric car factories and internet connected toaster makers, but here we are doing tax code stuff on the parts that make those toasters or whatever.

[baybal2]

> why not do social control of operations directly by tax codes for electric car factories and internet connected toaster makers, but here we are doing tax code stuff on the parts that make those toasters or whatever.

The West pretty much doing that already in more ways than one.

Last G7 was all about finding new ways to tax new industries

[cl0ckt0wer]

Wow, I had to look this up. Great band name! https://en.wikipedia.org/wiki/Chabazite

[_puk]

> > LED lighting fixtures, a kind of used in horticulture, containing over 5,000 LEDs spread across 6 light bars

Also, really makes one wonder if that sort of specific setup is perhaps the subject of an existing patent.

Imagine being in a position whereby there can be no innovation beyond a specific exclusion on a competitive cost basis, and that exclusion being wholly owned already.

Seems an alarming way to either enrich incumbents, or stifle Innovation full stop, or both.

[lonelappde]

This insinuation is simply false. Anyone building any product can apply for a waiver under the same general rules. The waivers only apply to the specific products that apply.

[ken]

Big companies like Apple can easily put many people to work applying for exemptions, while small business owners can’t afford to. The mere existence of such a system is rigged in favor of incumbents.

This is the “well anyone technically could have” excuse, aka the first chapter of “The Hitchhiker’s Guide to the Galaxy”.

[woah]

Reminds me of the detailed but oddly vague exemptions in California’s new AB5 law

[jtbayly]

So, my interpretation is not the same as yours. It does not appear that there is any consideration in this list for something along the lines suggested by the GP. Namely, I don't see "Company agrees to bring production of some other product into the US" as grounds for granting the waiver.

Is there any evidence that this was a quid pro quo sort of arrangement?

[wyldfire]

That's the vibe I got from the Apple PR. "Yay, still made in USA. This wouldn't have been possible without the exemption we got from the govt for us to import these parts w/o high tariffs." (Simultaneously prostrating ourselves and indicating our resolve to move production if necessary)

[1] https://mobile.twitter.com/realdonaldtrump/status/1154774656...

[lonelappde]

The point is that Apple tried to build a Mac in Texas, but would have to pay a tariff on some component X. So Apple said maybe it's better to build a the whole thing in China since we're paying tariff anyway. And the administration said OK, you can import X without tariff to enable the assembly in TX. It's not Apple's that the tariff pricing structure had perverse incentives.

[hoseja]

Except material/component cost and Apple margins are utterly unrelated.

[darksaints]

Regulatory capture in action right here. I'm willing to bet Apple fully supports these tariffs now that they have their waiver.

[Angostura]

If they had achieved waivers on iPhone components perhaps but a tiny volume, high-margin product like the Pro?

[lonelappde]

Baseless speculation. Especially silly since Apple does not compete on price at all.