[mystified5016]

The answer to your conjecture is simple Darwinist capitalism.

By whatever mechanism, imports are now more expensive, leading to less demand. Demand for those products actually stays constant, but the demand for imports goes down.

Now we have a niche. If you can produce a good locally for less than the net cost of import, you have an entire continent ready to buy from you.

The reason this has historically gone the other way is labor costs. Factoring the entire global supply chain into your product, it makes much more sense to do the work in a country where work costs less. If the additional cost to import is less than the delta on labor, you've won capitalism or something.

Or, take another angle. If the US can no longer import vital goods, what do you think will happen? Will the goods magically stop being vital? Will we sit on our hands for several decades and wait for the problem to resolve?

Or does the market respond to a need and rearrange itself to provide as profitably as possible?

[HeyImAlex]

It seems insanely risky to attempt to fill a niche that only opened up because of these tariffs. If they’re removed, congrats you just spent a bunch of capital to make a factory that is suddenly no longer competitive.

[windward]

Don't worry, that's the kind of thing that would only happen in a country with a fickle, mercurial government that doesn't value certainty and the rule of law.

[mech422]

>>Or, take another angle. If the US can no longer import vital goods, what do you think will happen? Will the goods magically stop being vital? Will we sit on our hands for several decades and wait for the problem to resolve?

No - consumers will just eat the cost like they did during COVID.

>> Or does the market respond to a need and rearrange itself to provide as profitably as possible?

  rearranging itself will mean leaving the status quo, and passing the cost to consumers.  Do you think companies are going to jump to spend millions of dollars and 1 year+ to build factories to work around something that might change in 6 months, or even 4 years ?

[saturn8601]

You are ignoring the 'Optimus' angle. Maybe Elon's stupid robot can actually do something and he has been whispering this into Trump's ear. That would take care of the labor cost issue. Lets see what happens.

[egypturnash]

Leaving only the "there is nobody who can afford to buy anything because there are no jobs left" issue.

If you reply with "but surely BASIC INCOME" then I must ask, what are you personally doing to help make that happen?

[feraloink]

EXACTLY! All the excitement over more and more automation means almost no one will have income to buy anything because almost everyone will be unemployed. So what is the use of producing goods and providing services then, even at lower cost? I don't know.

As for UBI, who is going to provide the money? I've never heard anyone talk about how that is supposed to work. YOUR comment is the first time I have ever heard, well, read, that point brought up. The government can't pay for UBI because there will no longer be a tax base of income earners due to lack of income. Companies can only contribute to the extent that they have customers. I suppose that a super-efficient, low labor economy could be almost entirely export-driven but that assumes the rest of the world isn't in the same situation.

[egypturnash]

I mean we could start taxing the ultra-rich, who have a greater share of the pool of dollars than they have at any point during history. Pick a number, ooh maybe 200% of the median income, something well below the point where you stop being human and become a giant bag of money pretending to be human, anything above that gets taken away by the state and redistributed to everyone. Rip up all the laws that create ways for people to hide money from taxes. The giant bags of money pretending to be people will scream, and try to make this stop; their money can buy a lot of politicians, and perhaps it will only happen if it’s that or the guillotine.

We could also acknowledge that money is a fiction; money is continually created by the banks under the authority of the government, and money can just be destroyed when it’s taxed instead of thinking it has to “balance the federal budget”. “A dollar” is not tied to any physical store of value but we still love to pretend it is. It’s just a fraction of the overall economic worth of the entire US, and entirely too many of those fractions are in the hands of huge bags of money pretending to be people.

Or we could just ditch “money” entirely. Add things like “lodging” and “food” to the Bill of Rights. There’s probably a lot of problems with this! And a lot of them probably rhyme with the problem that some people just really want to become big bags of money pretending to be people!

[sebastiennight]

You think earning twice the median income (for an American, this means weekly earnings of US $2,278) turns people into "giant bags of money" that are no longer human?

[egypturnash]

I'm scraping by on less than that in an entire month so maybe the number I pulled out of my ass is a little low.

Bezos makes ~8mil an hour according to some quick Internet searches and that sure is way over the "giant bag of money pretending to be human" threshold IMHO. The idiot-in-chief is worth ~$5mil and he sure is way over that threshold too.

[Imustaskforhelp]

Congrats, you just discovered socialism/communism.

[egypturnash]

Yes, I know.

[daveguy]

Hahahaha. Wait. Are you serious? Elon has been promising all kinds of things AI that are "just around the corner" for at least a decade now. It's always in the next year or two. There is no chance they cracked autonomous robots with those puppet bots they were showing off not long ago.

[saturn8601]

Look at all the braindead moves this administration has already done and we aren't even 6 months in. Maybe they actually believe his stupid robot can actually solve their problems. All we can do is sit back and see what happens.

[feraloink]

>Factoring the entire global supply chain into your product, it makes much more sense to do the work in a country where work costs less. If the additional cost to import is less than the delta on labor, you've won capitalism or something.

Yes, you've won capitalism, but sometimes, profit is a lower priority. Resiliency and the ability to avoid critical supply chain dependencies are important too. We learned that during COVID, when we only had one facility to make baby formula in the U.S., and we had a dire shortage of masks, gloves, etc. because we imported it all from China.

Another aspect of resilience is avoiding long attenuated supply chains, even if it is cheaper...for now. Why? Because there is a finite amount of fossil fuels (necessary in greater amounts for non-domestic maritime and air transit). Also, lower fossil fuel usage due to in-country sourcing would be better for the climate. I realize that the Trump administration isn't concerned about that! But it is true regardless.

[lukas099]

I seem to recall the shortage being "dire", but short-lasting. The market adapted and supplied the needed materiel. Is there any evidence or theory showing that a more protectionist system would fare any better?