Replying to Avatar Leathermint

Ot isn't about the capital allocation of individuals persay. It's how the whole economy shifts towards producing ressource A instead of of ressource B.

Let's say it used to be more profitable to produce ressource A instead of ressource B but the tariffs changed that. They would essential be producing something that is more profitable only because the state influenced in that way. Not because it is truly more profitable (and therefore better for society as a whole) to produce it.

In the long run this is what I see. Americans producing more cars instead of doing something else because the state didn't want Chinese cars even tho they were same quality at a lower price.

(This specific example is pulled out of my ass but this is the principal..)
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Leathermint 11mo ago

Tariffs distort market signals and function similarly to subsidies. They make goods or resources that were previously unprofitable to produce locally seem viable. However, this isn't a true gain in efficiency through innovation or technology. It’s an artificial shift driven by state intervention.

When we imported goods from countries that were more efficient at producing them, we could allocate our own limited resources to areas where we held a comparative advantage. State intervention in the market disrupts this natural flow and leads to capital misallocation, hindering true economic progress.

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AU9913 11mo ago

I agree, but would be willing to compromise with the powers that be if they used tariffs against countries that don't have similar protections against child labor or whatever.

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Leathermint 11mo ago

I don't know about child labor because I don't think it is necessarily bad but maybe one the produce from slavery you might conviction me. But then again, can't we not as individuals make this choice ourself?

But I understand there's definitely an argument to be made if the tariff is there for moral reasons.

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AU9913 11mo ago

That would imply consumers are informed instead of lied to

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Jedi 11mo ago

What is the difference here? Do you think child labor gets paid?

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Leathermint 11mo ago

Well, yes.

If they aren't they've probably been kidnapped or are working directly for their parents and parents have no obligations to give their children a wage.

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BottleTeams 11mo ago

The academic tariff playbook assumes countries don't weaponize their currency and reduce their populous to slave labor. This is the world we live in and tariffs are the only defense against that.

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Leathermint 11mo ago

I'm not sure what you're trying to say.

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BottleTeams 11mo ago

If another country produces goods with save labor (eg. China through excessive currency devaluation) a country that does not excessively devalue their currency along with them loses all their domestic production through outsourcing (eg. The US)

The only way to defend against this is through tariffs.

The reason the US has to play the currency devaluation game is because of China. This is why we're in this situation in the first place and why #Bitcoin was created to defend against this attack vector.

Russia for example has not played the currency devaluation game; and has sky high interest rates to defend against outsourcing. The result is a totally stagnant economy but a "sound" currency. The US cannot have the world reserve currency along with high interest rates (by default we should have the lowest interest rates) so we cannot compete in the currency devaluation game with China. Bitcoin is the mechanism that resets the currency devaluation game.