A Short, Limited Lesson In Economics
Imposing tariffs on outsourced "jobs" doesn't work as simply as it sounds spilling from the lips of a politician trying to cover his ass. But if you don't understand the inner logistics of how global business works, you can be conned into thinking things are looking up. Today's example: Samsung LG Washing Machines. Lots of people like them. Just like they like other Samsung electronics. They're a South Korean brand, for anyone who just crawled out of a rock pile.
Samsung LG companies just got hit with a tariff that threatened their bottom line. This is a political move that's supposed to be a solution to American employment. The simple idea is that if we make it more difficult for foreign brands to be imported to the US, we'll end up with more washing machine factories of our own. American made. New jobs. Everything solved, right? People will start buying American made washers and hate on Samsung?
Here's how it really works. Foreign countries actually have more factories in the US and provide more jobs than a lot of American brands. Samsung LG was recently going to open a new factory for their washers in Tennessee. But that got halted over the new tariffs. Here's the breakdown of how it works:
A South Korean factory opens in the US, making Samsung washers. It employs a bunch of Americans. The parts, however, come from yet another country. South Korea gets parts imported to them from Vietnam (and possibly more countries in that area), which they send to the US, which is used in the making of washers by American employees. This is a three, and sometimes four tier system. Then a tariff comes along, imposed by a politician that wants to look like he's doing a good job. It won't be paid by the company, however. They're just going to raise their prices per washer, from $50 to $400 depending on the brand. So if you want to buy a Samsung washing machine, you have to pay more. Oh.. and the factory in Tennessee isn't happening anymore. It might later, when they figure out how to recoup their temporary losses, but for now it's on hold.
This is a second blow to the Tennessee economy, by the way. The same thing just happened with solar panels made in a factory in Tennessee- a factory put there by China. So a lot of people are out of work in Tennessee.
Tax mandates designed to punish companies from other countries do not work. They just shut down American factories and throw a wrench in sales, which will be made up in other ways. When is the last time you heard of a giant company following tax rules? They find ways around it. We can continue to be conned, though, through things like..
"China has announced it will be putting a solar cell factory here in the US now since tariffs were imposed on their imported solar cells", says a couple of major news sources. (This is a second Chinese company partnered up with solar businesses in the US.) The thing is, American solar companies are not interested in having the parts made here. They make more money on installing complete systems instead. This will just undermine our attempts on using alternative power sources as people decide it's getting too expensive.
No company is stopping global trade. Parts and scraps are coming from all over the world. It's not as simple as "let's just make a product in the US". The US is not a giant manufacturing nation with its people all working on assembly lines like a bunch of slaves. (Unless you really want that to be your life- do you want to work your life away as a cog in a wheel?) I prefer not to lose the art, the entertainment, and the rock and roll culture that America once captivated the world with. I like our culturally rebellious reputation. I'll die before I'll go sit and make fucking solar cells all day.
So what about the tariffs and all the jobs for struggling families? Companies are not gonna pay any extra costs. We are. Tariffs are designed to favor US brands and not US jobs. Does nobody think a foreign company won't just team up with us and slap a US name on it? Companies find a way around everything designed to "punish" them. We're not making all our little parts for big brands here. And even if we do make our little parts here, those jobs will be done via mechanical means. It's cheaper to employ robots.
This is just a base, almost retardedly simple explanation of how it works. It doesn't even begin to dive into the complexities of US economics and business. But I know imposing a tariff isn't going to give everyone jobs.
Samsung LG companies just got hit with a tariff that threatened their bottom line. This is a political move that's supposed to be a solution to American employment. The simple idea is that if we make it more difficult for foreign brands to be imported to the US, we'll end up with more washing machine factories of our own. American made. New jobs. Everything solved, right? People will start buying American made washers and hate on Samsung?
Here's how it really works. Foreign countries actually have more factories in the US and provide more jobs than a lot of American brands. Samsung LG was recently going to open a new factory for their washers in Tennessee. But that got halted over the new tariffs. Here's the breakdown of how it works:
A South Korean factory opens in the US, making Samsung washers. It employs a bunch of Americans. The parts, however, come from yet another country. South Korea gets parts imported to them from Vietnam (and possibly more countries in that area), which they send to the US, which is used in the making of washers by American employees. This is a three, and sometimes four tier system. Then a tariff comes along, imposed by a politician that wants to look like he's doing a good job. It won't be paid by the company, however. They're just going to raise their prices per washer, from $50 to $400 depending on the brand. So if you want to buy a Samsung washing machine, you have to pay more. Oh.. and the factory in Tennessee isn't happening anymore. It might later, when they figure out how to recoup their temporary losses, but for now it's on hold.
This is a second blow to the Tennessee economy, by the way. The same thing just happened with solar panels made in a factory in Tennessee- a factory put there by China. So a lot of people are out of work in Tennessee.
Tax mandates designed to punish companies from other countries do not work. They just shut down American factories and throw a wrench in sales, which will be made up in other ways. When is the last time you heard of a giant company following tax rules? They find ways around it. We can continue to be conned, though, through things like..
"China has announced it will be putting a solar cell factory here in the US now since tariffs were imposed on their imported solar cells", says a couple of major news sources. (This is a second Chinese company partnered up with solar businesses in the US.) The thing is, American solar companies are not interested in having the parts made here. They make more money on installing complete systems instead. This will just undermine our attempts on using alternative power sources as people decide it's getting too expensive.
No company is stopping global trade. Parts and scraps are coming from all over the world. It's not as simple as "let's just make a product in the US". The US is not a giant manufacturing nation with its people all working on assembly lines like a bunch of slaves. (Unless you really want that to be your life- do you want to work your life away as a cog in a wheel?) I prefer not to lose the art, the entertainment, and the rock and roll culture that America once captivated the world with. I like our culturally rebellious reputation. I'll die before I'll go sit and make fucking solar cells all day.
So what about the tariffs and all the jobs for struggling families? Companies are not gonna pay any extra costs. We are. Tariffs are designed to favor US brands and not US jobs. Does nobody think a foreign company won't just team up with us and slap a US name on it? Companies find a way around everything designed to "punish" them. We're not making all our little parts for big brands here. And even if we do make our little parts here, those jobs will be done via mechanical means. It's cheaper to employ robots.
This is just a base, almost retardedly simple explanation of how it works. It doesn't even begin to dive into the complexities of US economics and business. But I know imposing a tariff isn't going to give everyone jobs.
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