[calvinmorrison]

a purported niche/low-volume electronics, but the profit is somehow dependent on BOM price? a tariff bump on a small BOM doesn’t take you from profitable to homeless.

if that happened, the business already had seriously bad margins, bad cash flow, over-leverage, or maybe he was just doing it out of love getting paid maybe back for his time or not.

tariffs might’ve hurt, but they don’t collapse a healthy niche hardware company where buyers are presumably also into the niche.

seems weird i dont get it. can you explain further?

[herdymerzbow]

gamers nexus did a great (and very long) video on the impact of tariffs on US computer businesses. Some of the manufacturers went into quite a bit of detail breaking down their costs and how tariffs would render some products so unprofitable that they would cease to serve the US market. Not sure if it necessarily applies to a niche/low volume business, but the impacts on a larger business were eye opening:

https://www.youtube.com/watch?v=1W_mSOS1Qts

tariffs have chopped and changed so much since this video that the specific tariff amounts mentioned are likely not accurate.

[iancmceachern]

Hardware companies often operate on a relatively thin margin, especially as compared to say, software companies.

Let's say a companies margin was 40%. The cost of their constituent parts doubles due to tariffs, they are no longer making money as a result.

I hope this helps explain it for you.

[WalterBright]

It's more complicated than that.

For example, the company can raise its prices. How well that works depends on whether there is competition for the company's product. If the competition is also hit by the tariffs, then they're on an even playing field. If the competition is using native parts, then the competitor gets the business.

[iancmceachern]

This is one of the great misconceptions.

There are often no "native" alternatives.

Even the machines that make the chips are nearly all made in one country and then shipped around the world.

The amazing, modern nature of our modern world is built on the collective effort and knowledge of humankind globally.

Globally.

[WalterBright]

There's concern that if all our chips come from one country, they could cut the supply off and make demands. That's called an "embargo".

It's also done to protect local industries, hence the term "protectionism". For example, Canada's large tariffs on American milk are there to protect the local Canadian milk producers.

AFAIK, Trump's tariffs are meant to serve the following purposes:

1. so critical supplies, like chips, will be produced domestically

2. to raise money for the treasury

3. to convince countries that have high tariffs to lower them in exchange for the US to reciprocate in lowering ours

4. to incentivize foreign manufacturers to invest in factories in the US

5. to use them as a negotiating tool for other terms favorable to US interests

These are not crazy things. We'll see how things play out.

[Teever]

What leads you to believe that the implementation of tariffs under this administration was done for the purposes that you have enumerated?

It seems that you're operating under the normally reasonable assumption that these policies were implemented after careful consideration with specific goals in mind. I don't think it's reasonable to assume that the people involved in this are doing what they're doing for well-thought out reasons or ones that are meant to benefit America.

[WalterBright]

> What leads you to believe that the implementation of tariffs under this administration was done for the purposes that you have enumerated?

That's what the administration has stated as the goals of them.

For example, many foreign companies have announced plans to invest in creating factories in the US. How that will eventually work out will take some time to see.

> I don't think it's reasonable to assume that the people involved in this are doing what they're doing for well-thought out reasons or ones that are meant to benefit America.

That's a pretty fantastic assumption. I cannot think of a single instance of any President imposing a policy meant to hurt America. Of course, in my opinion, a lot of Presidents have pushed policies that I regard as destructive, but they didn't mean it to be.

[thepryz]

Agreed. Tariffs should be used like a scalpel, precise and targeting very specific things to encourage development or even the playing field. The tariffs that have been implemented so far are more like a sledge hammer, used to extort and intimidate.

[rootusrootus]

> 2. to raise money for the treasury

And admitting that is why SCOTUS will kill them. Raising money for the treasury is Congress' job, not the executive's.

[simonh]

They’re not crazy goals, but the way these tariffs are being implemented does not further most of them.

3 and 5 are undermined by the fact that even nations with positive trade surpluses with the US, and countries like Japan with Trump first term negotiated trade treaties (which for Japan included major concessions already) are being hit with these tariffs.

1 and 4 are a problem because many of the inputs into building out US manufacturing capacity come from abroad and are hit by tariffs. Secondly many of the manufacturing inputs into making products in these factories would come from abroad and be tariffed, unless those supplies are bootstrapped domestically first but there is no policy to ensure this. Thirdly as soon as the tariffs go away, these factories would become uneconomical, so they are a gamble on that not happening in the lifetime of the factories.

Finally, who’s going to build and operate this huge new manufacturing sector? Infrastructure construction relies heavily on immigrant labour that’s being driven out, so does actual manufacturing, and there are no hordes of unemployed Americans lining up for manufacturing jobs. It’s addressing a problem that largely doesn’t exist, to build out less efficient more expensive ways to make stuff, in a way that can’t work anyway.

Manufacturing investment surged in the last few years with the introduction of the CHIPS and Inflation Reduction acts. It’s going to be hard to disentangle the continuing effects of that from the effects of the Tariffs, but it’s hard to see how the Tariffs can have a positive effect.

[WalterBright]

> but it’s hard to see how the Tariffs can have a positive effect.

Any change in policy will make things worse before they get better. For example, if you have surgery to remove a tumor, you'll endure a fair amount of pain and misery before getting better.

[realo]

I am Canadian. Since the USA started their economic war with Canada, I changed some habits, like my other fellow canadians.

1) Stopped buying USA wine totally

2) Canceled our plans for vacations in the USA

3) Stopped buying USA orange (or any citrus) juice

4) Carefully check the provenance of any fruit or vegetable in the supermarket and actively avoid anything that comes from the USA

... and the list goes on.

I am not alone!

How do those immediate and tangible consequences serve the interests of the USA producers and companies affected, exactly?

[DaSHacka]

A bunch of easily psyopped morons aren't a large enough majority of the general consumer populace to be worth considering. For every 1 of someone like you, there's 50 people who blindly grab the cheapest product off the shelf that gets the job done.

The presence of a few nationalistic morons doesn't wholly negate the goals mentioned by GP, and in fact, may be more important than ever.

[iancmceachern]

There is no way Taiwan would ever embargo the US re:chips.

Making and shipping chips all over the world is what keeps Taiwan safe. They would never jeopardize that.

[DaSHacka]

What happens when China finally decides to take back what they believe is 'rightfully theirs' and stops it for them? It's not exactly a position you want to be in.

[AnthonyMouse]

> If the competition is also hit by the tariffs, then they're on an even playing field.

That assumes the customers are price insensitive. If you're making vintage parts for hobbyists and archivists, maybe they're not; maybe they don't get a raise just because the price went up and your thing is the thing they cut out of the budget when it all won't fit anymore.

[esalman]

Do you run a business with good margin, good cash flow, optimally leveraged and for profit? If yes, please tell us more about how tariffs have helped you.

[WalterBright]

If you've been making the products locally, the tariffs on foreign products help you.

[scheme271]

Are your materials and supplies also locally made? The same for each of those suppliers. Very few things are entirely made in the US. How about your equipment? Are the motors, tools, electronics, etc also made in the US? Even companies making stuff in the US are being hit. Very few companies have their entire supply change within the US.

[SturgeonsLaw]

Depends on your supply chain's exposure to foreign markets

[esalman]

You cannot truly make anything locally these days. We had decades of free trade. It will take decades to roll back. And you will lose all the benefit that came with it.

Even if we pretend the policies are well-intentioned, it takes decades of investment to make the infrastructure and workforce ready to produce things locally at scale. With policies like the dismantling of department of education, I do not see any initiative being taken to prepare the workforce for the future.

Let's face it, tariffs are a disaster. The increased prices, hurt American businesses, caused job loss, and increased waste and bloat. The administration created a problem (tariff induced inflation), now they are selling the solution by rolling back tariffs to bring prices down. Anybody older than 8 years know this was the same playbook in previous administration. And they know their base is gullible eough to fall for it. It's just unfortunate that hacker news audience in included in there as well.

[WalterBright]

> With policies like the dismantling of department of education, I do not see any initiative being taken to prepare the workforce for the future.

The DOE was created by Carter, and there is no evidence in the last 45 years of it having any positive effect on education in the US.

[esalman]

Your argument is so baseless that even a template AI response can refute it.

Yes, the DoE has been planting decade-scale workforce seeds since the Carter years—mostly via STEM/CTE programs that outlive administrations. Core idea: build adaptable skills (problem-solving, digital literacy, work-based learning) so kids & adults can pivot when AI/climate/whatever nukes today’s jobs.

*Carter-era kickoff* - 1979: Science and Engineering Education Act (Carter signs) → first federal push for pre-college STEM pipelines. NSF/DoE joint grants still fund teacher training 45 yrs later.

*Reagan/Bush I* - 1983 A Nation at Risk → DoE launches magnet schools & AP incentives. Many still running.

*Clinton* - 1994 School-to-Work Opportunities Act → seed money for apprenticeships. morphed into Perkins.

*Bush II* - 2006 Perkins IV → “programs of study” with stackable credentials. Still the backbone of high-school CTE.

*Obama* - 2010 Race to the Top → $4B for state STEM/CTE alignment. - 2014 Computer Science for All → CS now in 70% of HS nationwide.

*Biden* - 2022 YOU Belong in STEM + 2025 DOL/DoE joint admin of WIOA/Perkins → less red tape, more training $.

*Impact numbers* - Perkins V: 8M HS students/yr in CTE; 1.3M postsecondary. - WIOA adult ed: 1.5M/yr gain credentials. - Meta-analyses show STEM exposure → +0.2σ critical thinking, +15% lifetime earnings.

*Caveats* - Funding is ~$16B/yr total—peanuts vs GDP. - 2025 DoE staff cuts (≈50%) threaten oversight. - Europe still laps us on apprenticeships (3-yr paid tracks vs US 6-month internships).

Bottom line: DoE’s been playing the long game since disco. The programs work, but they’re chronically underpowered and politically fragile.

[WalterBright]

Test scores haven't improved since 1980. Funding programs is not an accomplishment.

[samtheprogram]

Indeed, it's directly contributed to burgeoning administrative costs in universities through the Federal Student Loan program, and related the devaluing of college degrees.

It's probably helped in some aspects too, but the student debt crisis was created by the DOE. And most everyone can agree that college costs have ballooned in the US while the value of the degrees have decreased.

It's a perfect example of the worst of both worlds of government guarantees in a capitalist society, like Amtrak and US health care. It eliminates many aspects of competition and blurs incentives while remaining in a economy where decisions are profit-driven.