Walmart just leveled with Americans: China won’t be paying for Trump’s tariffs, in all likelihood you will
Walmart just leveled with Americans: China won’t be paying for Trump’s tariffs, in all likelihood you will
Trump promised voters tariffs are a panacea for the economy, but Walmart finance chief John David Rainey warned they will be inflationary for customers.
inb4 products that have absolutely no supply chain dependence to China 'somehow' increase in price.
- It's Walmart: what item they sell has no connection to China?
- It's important tariffs actually the board not just China
Hey now, the Waltons need some extra cash. Who could even get by on a measly four million dollars a hour in this economy?
Gotta prepare just in case one of them gets drunk and murders a person with a car again.
Yup. I am the international buyer at my Made in America company. We pay the tariffs. We do not absorb them it gets added into the price. And when China is 50-75% lower than American made, another 30% tariff isn’t going to bring the business back here. I kept posting that on my Facebook for weeks before the election. No one listens.
Everyone seems to be wringing hands about policy, but this is just another datapoint that propaganda won this election.
Even worse, China has already begun moving their Chinese-owned production to Malaysia, circumventing the tariffs on Chinese imported finished goods.
I heard about this a few months back on a podcast about auto parts. China just shipped the fan belts they were making to a warehouse in Vietnam, rebranded them, and shipped them to the US, tariff free.
They did some sort of chemical analysis on the Made in China and Made in Vietnam belts and the formulation of the rubbers was identical.
Enforcement to counter this would likely eat up too much of the tariff money, so it just won't be done. China will still get paid the same, and at minimum we'll eat China's additional shipping costs.
One possible silver lining:
By removing dirt-cheap goods from the market, this could make it more difficult to ignore the underlying problem: People are not being paid enough for their labor to afford the things they need at home. Instead, they are expected to depend on subsidized/sketchy foreign manufacturing, while corporations and the super-rich are being allowed to extract a disproportionate share of the world's wealth from everyone else, hoard it, buy favorable legislation and policies, and avoid paying their fair share in taxes. This is already unsustainable; tariffs will make it more obvious.
(I don't imagine this is why Trump wants tariffs, but perhaps he'll accidentally place the straw that breaks the camel's back, leading lawmakers to face either reform or revolution. Unfortunately, I think it's likely to make things worse for the rest of us before it makes things better.)
Tariffs make companies able to compete better within the walled garden, but weakens their competitiveness worldwide. It creates a race to the bottom inside the garden, but makes them weak outside the border. They also makes prices increasefor the local buyers. Costs get passed along, it's not as if manufacturers are going to absorb increases, they don't need to. GM, Ford, Chrysler are all going to pass them on (as any domestic manufacturer)
Where does the money raised by the tariffs go?
Mar-a-Lago
Once again, corporate america will use this as an excuse to raise prices more than necessary, gouging the people and stuffing the pockets of CEOs.
Correct. Trump’s 2017 tariffs raised the price of foreign made dishwashers by 20%. American manufacturers also jacked up the cost of their appliances, in order to match that price that customers were paying for the other brands, pocketing the difference.
Yep, and the prices will stay high even after the tariffs are gone.
Grocery stores are the worst about this too. Prices are still absurdly high despite there being no more supply issues from covid.
The average American is already stretched to the breaking point with what overinflated goods they can afford. We'll soon see people either buy just the bare essentials or start stealing at a much higher rate than we already have. Food riots might very well be a thing in the world's richest country soon.
The genius part is now that Republicans are in charge of the government here, deficits no longer matter, and they will push through huge tax cuts on the rich. These massive tax cuts will only trickle down to working folks in the form of direct rebate checks, just to give Trump an excuse to have his signature all over them. Trump will convince these people that the additional money is to help offset rising prices, and his voters will believe it.
Deficits will no longer matter until after the midterms, and then if Democrats can gain back control of either house of Congress, the deficit will become a big problem again, that can only be solved by slashing more programs. The checks will stop, and Trump will blame Democrats.
That’s the point
The fact that they're sending this message now means they will use this as an excuse go raise the prices even higher than nessesary to increase their profit margin. If they really cared about consumers then they should have been yelling from the treetops BEFORE the election.
They said this the last time it happened... During his last presidency.
Walmart Chief Financial Officer Brett Biggs said in an interview that higher tariffs will result in increased prices for consumers.
If only someone else said something about how bad these tariffs would be...
https://amp.miamiherald.com/opinion/article292867514.html
https://www.euronews.com/business/2024/11/04/how-much-could-trumps-tariffs-damage-europes-economy
https://thehill.com/opinion/finance/4938752-trump-economic-policies-impact/amp/
https://amp.cnn.com/cnn/2024/10/16/politics/trump-fact-check-john-deere-economy
https://www.semafor.com/article/10/18/2024/what-are-the-consequences-of-trumps-tariffs
https://www.businessinsider.com/trump-tariff-threat-john-deere-economists-baffled-2024-9
https://fortune.com/2024/08/16/trump-tariffs-trade-war-inflation-economic-policies-joachim-klement/
https://www.cbsnews.com/amp/news/yellen-speech-tariffs-will-increase-inflation-risk-trump/
No shit.
Tariffs alone will not revive domestic manufacturing, the demise of which has numerous causes, but two in particular.
1.) Corporations maximising profits. I don't think this needs much of an explanation.
2.) Consumer apathy. By which I mean consumers not giving a shit and consistently buying the cheapest garbage possible without regard for the long term cost. Quality products cost more money up front and ideally have a lower total cost of ownership. But, the average consumer only cares about the price tag on the shelf. The long term costs of this behavior and the related disposable culture are enormous.
Unfortunately, one of those costs are the loss of middle class jobs cranking out products at a plant in Ohio because now the plant is an empty field and the jobs got shipped overseas.
Reminds me of this Jib Jab video from like 2005.
It's also impossible to know if the 30$ item will actually last twice as long as the 15$ item. What is clear is the price tag.
2.) Consumer apathy. By which I mean consumers not giving a shit and consistently buying the cheapest garbage possible without regard for the long term cost.
This has some validity, but it is not as simple as just saying, "American consumers are stupid" and having done with it.
Quite a few shoppers, possibly even the majority, are living paycheck-to-paycheck and cannot afford anything other than whatever the cheapest thing on the shelf is. They are barred from making sound long-term purchasing decisions because they don't bring in enough income to afford the superior product, even if they wanted to. It's a case of, buy what they can afford regardless of low quality, or nothing. This is the real life version of the Vimes' Boots Economic Theory.
I will also point out that a huge portion of spending by individual Americans is on perishable commodity goods with largely inelastic demand, the purchasing of which cannot be put off. In plain English, that's food and fuel. I will also point out that these are two categories that are to many decimal places absolutely not tied to Chinese importation in any way whatsoever (in fact, the vast majority of food sold in America is grown and packed in America, and when you take prepared foods into account that number rises to near as makes no difference to 100%) so we automatically know that any supposed "tariff" increases on these products are in reality just a bullshit profit grab by retailers and/or Kraft-Heinz or Nabisco or whoever the fuck.
There is a link between tariffs and food prices, the vast majority of American agriculture is mechanized and the machines and their parts are mostly manufactured overseas. As are the trucks that account for a huge percentage of the distribution network.
Glad they said this after the election
/s
They don't give a shit that the customers will be paying more. In fact, if anything, they probably love the excuse to jack up prices further - or further cut their workforce to the bone, or whatever the latest fad in padding executive compensation packages is.
Trying to speak sense to Americans. You are in for a rude awakening. They will blame the high prices on space lasers.
And immigrants, "wokeism," and Obama, Joe Biden.
Yeah, no shit. How the fuck do people think tariffs work?
In their minds, they literally think of them as some sort of "cover charge" that foreign manufacturers pay to get their goods into the US, and that they will do so gladly and neither seek other places to sell nor raise their prices. They think that these companies will eat the losses until they decide to build factories in the US, or they will simply wither away and American factories will sprout up like dandelions in a sidewalk.
The fact that all of it is completely wrong doesn't matter, because the people telling them otherwise don't have on a red hat and an ill-fitting suit.
If they knew how tariffs worked, fewer of them might have voted for the dumbass proposing to make things cheaper by raising them.
The same way they thought "Mexico will pay for the wall" was gonna work - they didn't think about it at all.
They just blindly trusted the habitual liar, despite all evidence to the contrary.
"Think"?
My new job came with a 10k sign on bonus and I just got the first half 3 months in. I have to pay the whole thing back if I leave within 2 years. I was planning on keeping all of it in high yield savings in case I need to slap it back down on the table and run, and best case scenario at the end I have a house downpayment.
Y'all. I got taxed more on this check than I made in working hours. I got the 5k bonus and 3k of working hours. I paid over 3k in taxes and didn't even net 5k this check. It was 4900 something.
I understand that I'm not "poor" anymore but I'm still paycheck to paycheck (I wound up just paying off some credit card debt; I'll get a loan if I need to run). More importantly I have a real job. I'm not some marketing desk jockey or a landlord or an MLM "entrepreneur," I'm an inpatient bedside nurse. I don't want to sound full of myself but how does Jeff Bezos not pay any taxes and I'm over here paying 37%???
Taxes are usually taken out using the monthly amount like a yearly amount. You'll probably get a lot of it back when you pay taxes for the year.
You will definitely get a lot back. They tax it like you make $8k every month.
You should reduce your tax amount that your company is paying for you to the IRS. You can calculate it yourself and tell your company to modify it.
I would check with your local laws but it's very rare those kinds of policy are enforceable. If you need to pay them 5k to quit, it's akin to slavery.
Yeah slavery is pretty much just legal in a bunch of the US. It could be worse, I could be a prison laborer or one of those immigrant nurses who have been basically legally human trafficked into high violence positions like psychiatry, ER, or skilled nursing facilities (nursing homes, lots of dementia with little support / backup). I do work psychiatry but I'm an actual psych nurse as opposed to a medical specialty nurse who got suckered into it with no actual psych experience and now is stuck dodging punches to keep their green card. It's really hard to not sound prejudiced when honestly my biggest problem with them bringing in so many international nurses is that they're doing the immigrant nurses dirty. The fact that their abuse exists as a mechanism to depress my wages is just icing on the shit cake.
No, they're actually pretty common in certain industries, and definitely enforceable, at least for sure within the state of California. If you sign a contract that says you get a certain amount of money for starting a job, contingent on working for them a certain length of time, that's typically paid out on day 1, but you have to pay it back if you leave early.
This is why Trump wants immigrant labor camps
It would have been helpful if they made this statement before the election.
It's amazing we're having this conversation given that the pinnacle of conservative thought is that you can't make the rich pay for anything because they'll just pass the costs down to you, and yet that seems to go out the window when you can be racist about it.
In the end, this glues China and Europe together to prepare the next disaster...
Oof. Dorian Gray just looked at the portrait.
Yes, anyone reasonable knew that this would lead to higher costs. Americans are expensive to employ. The point of the tariff package is to bring back manufacturing and production to the USA. Stop importing so much crap from China and other places, and things will balance out. That increase in costs should be compensated for by jobs for American citizens across all sectors if people respect the purpose of the tariffs - to disincentivize imports whenever and however possible.
Except, this measure won't result in that at all. Punishing companies for importing is only going to punish consumers. The company wants it for as cheap as possible, and that will often be importing. Even ifbit becomes expensive to import, it will be cheaper than the capital needed to set up the infrastructure for manufacturing domestically. Rewarding companies for sourcing materials and labor domestically will incentivize them to bring jobs here. At least more so than making them pay more to bring it in.
That's never going to happen. What will happen is that companies will raise their prices slightly higher than the tariffs cost them, fire more of their workforce, and then brag to investors about their most profitable quarter ever. Plus, that would require the tariffs to be on finished products only. I've already heard of several companies announcing no Christmas bonuses this year because they need to stock up on materials in anticipation of the incoming tariffs.
And most of the people supporting tariffs thought that they were going to make things cheaper AND that China was going to pay them.
This is one of those things that Trump never actually said, his supporters have just been saying for him for months now. Another one of those "what he really meant was..." Because that's what won't happen, even if it did it would take decades to move production back.
I buy parts internationally for a domestic manufacturer. The parts are as good if not better than us made. They are also 50-75% less than US WITH the current 25% tariff. Another 20-30% increase isn’t going to bring it back to the US, it will just increase costs.
The point of the tariff package is to bring back manufacturing and production to the USA.
That was the claim.
But in reality, American businesses will do whatever is more profitable for them.
And even if it becomes more profitable to build a factory (including paying the tarrifs on the machinery needed 'cause that factory hasn't been built in the US yet) and hire (and train) a workforce, that will take years to do, and even more years before the capitol cost is recovered and it starts being profitable.
By which point Trump will be dead and gone and maybe a more sane government will have eliminated some of Trump's more stupid impacts. And then the owner of the new factory may not be able to compete with overseas factories at a level of extreme profit they want...