Wow this administration is f**ing batshit insane. I thought the tariffs would be on raw metals, not anything at all that happens to contain them.
Wow this administration is f**ing batshit insane. I thought the tariffs would be on raw metals, not anything at all that happens to contain them.
For example, the US has some of the largest lithium deposits in the world, but it's not being exploited because extraction is dirty and polluting, generally the compliance for opening a new mine is very complex (takes 7-10 years), and catching-up on refinery capacity will take an enormous investment (China does almost all Li refining now).
Similarly, developing the techniques to boost oil extraction (fracking, EOR...) took significant and sustained government support of different kinds until it became competitive, it's unclear if market pressure alone would have done it. This made the US again into the largest exporter rather than the largest importer of oil.
There are many such cases.
Note: I'm not from the US, and I'm not particularly pro-US, I'm not saying that tariffs are a good mechanism to support these industries, and I'm not necessarily in favour of such anti-environmental policies. But those are the facts as I understand them.
If the US has a ton of Lithium but finds it too expensive to extract, why not buy it now while it's cheap, wait for it to become rarer in other countries so more expensive, and only extract it once it's worth it (or close to worth it)?
It's important to get news from politically unbiased sources, because the reality is that US lithium sources are being stood up! Especially in that politically incorrect state of California which is supposedly a hellhole that would never approve something of the sort.
As for tariffs being a good way to support these industries citation needed! It's exactly the opposite type of policy for driving the investment that's needed. It's actually drastically collapsing all of the massive investment that was happening under Biden, in a complete disaster for the US. So I totally agree that you are not pro-US, but let's be honest about the disaster of tariffs.
But these things take time and significant capital to develop, you often need to be non-competitive for years, doing things in a more expensive way, until you can catch-up. But then you can overtake everyone else, if nothing else due to the momentum of growth and the higher efficiency you had to maintain to catch-up. Just like it happened with oil in the US, or with Germany, Japan, Korea or China recovering from catastrophe.
If you don't do this, you can get cornered, where in principle you can produce a resource much more efficiently in your country, but you can't quite climb over the hill because you are addicted to depending on others as an economy and you don't anymore have the capital, know-how or culture for such things.
It's the same reason why all the manufacturing outsourcing was so short-sighted. Sure, you're saving a few bucks on labor, but you are literally giving away all your knowledge about the manufacturing process! Those local factory workers you are firing? They won't be around to train new workers when you want to restart the local factory a decade or three later. Meanwhile, the factories overseas haven't been sitting idle either and have kept developing their manufacturing processes. They will not give you their trade secrets so you're going to have to reinvent the wheel yourself - without experts.
Congratulations, you have created your own competitor, and they are now better than you.
If you want tariff that option away from a bunch of China-men, have them do the next even shittier dangerous job that they bypassed on the way to the steel mill, and then save them while you instead work next to molten iron, that's the proposition you're moving towards.
Of course if you want a little taste of being that hero, there are domestic steel mills currently hiring, you can take that job so the next guy in line won't get maimed. But somehow I think you won't, so you must be "all cool" they are "instead maimed."
Closest I can think of is the Romans required a constant influx of cheap labour from outside their empire for their economy. When the flow stopped (diminished conquering meant diminished number of slaves coming in) that was a major factor in economic decline.
There's really no reason why we shouldn't have steel mills aside from that.
What's more likely, as I stated in another comment, is if you destroy their comparative advantage at a tariffed industry, the Chinese guy that had the steel mill as his best option now has to move to the next even shittier one. Tariffs are usually economically worse than zero-sum.
I'm not sure what you're arguing for here, but you come off as morally bankrupt. Worker safety can certainly be improved but people like you happily shrug it off and are fine with hazardous cost cutting which allows people to continue to be maimed as long as you're steel or whatever is super cheap.
To answer the broader question, if you believe in markets at all, then demand creates supply, and supply for cheap (and therefore abused) labor is arguably at least in part responsible for economies like China being so shitty to your average worker. If all Western countries would e.g. slap tariffs on goods imported from places with poor labor rights, but they were specifically contingent on that (and not just a list of countries that our Great Leader has a problem with), that would put the pressure on the Chinese government to raise the standards to remain competitive. That would be the kind of tariff I would support, and I don't buy the argument that if we don't allow for such shitty jobs, the alternatives would be even worse - this is exactly the kind of attitude that creates a global race to the bottom that is the major driver for enshittification all around.
It is consistently frustrating to me to read so many analyses mentioning "comparative advantage" when what they mean is "minute labor protections compared to American standards". Americans can't freely compete when others who sell labor and goods in their marketplaces don't have to follow any of the same rules.
1) We will tariff the Chinese to make it unprofitable to sell to America anything built using anything other than our self-imposed regulations.
2) When more American steel plants etc are built, assuming investors even believe the tariffs will exist through enough administration to make it profitable, they magically will somehow be safer than working in the other industries these workers were pulled from, and magically not continue to be one of the more dangerous occupations in the USA that for mysterious reasons we want more people risking their hides in.
Reality:
1) Chinese do the same thing as always, and sell to the other 95% of the world, with no labor condition changes for the chinese.
2) More Americans get their arms turned into molten lava instead of Chinese (see recent Clairton plant explosion, yay for building more of that?). So labor conditions degrade for Americans.
3) Other Chinese figure out how to game the system enough to pretend they've followed the same rules, because lets be real, "the king is far away and the mountains are large."
4) The few Chinese not manufacturing for the other 95% of earth and haven't figured out how to game the system, are fired and work at the next even shittier job they passed on the way to the steel mill.