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Old 12-06-2016, 07:53 AM
 
2,944 posts, read 3,004,114 times
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I just finished James Rickards's book "The Road to Ruins" and he argued that tariffs could bring back high paying manufacturer jobs. The example he provided in the book is Apple who produces their products in China (where China has both labor and capital advantage) cheap and then sell their products back in the US for big profit. He argued that by imposing a tariffs, it will provide Apple the incentive to build their product in the USA instead of China.

I do agreed with Mr. Rickards's reasons. HOWEVER, what he failed to point out is the US labor culture. We as a country feel entitled to everything which make us very lazy. The average work week is at 37.5 hours for blue collar (non-exempt) employees, which is most of these jobs will be. Most US workforce refuse to work OT and on weekend.

I think Apple and all US companies should bring the jobs back so we can continue to afford to by their high priced item. But the question is:

If you are Apple, can you trust the US work force culture on an urgent, live or die situation?
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Old 12-06-2016, 09:21 AM
 
Location: NY/LA
3,353 posts, read 2,827,494 times
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I'm curious as to whether or not the book considers foreign competition. If Apple has to pay US wages for manufacturing, but companies like Samsung and HTC do not, then doesn't that put the US companies at a disadvantage when the foreign competitors can manufacture their goods for a lower cost... especially if all companies are competing to sell their goods globally?
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Old 12-06-2016, 09:55 AM
 
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how do you account for products that aren't physical?

as more and more people use smartphones, they spend more on apps than the actual phone. How do you place a tariff on an app or software or internet videos/calls?
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Old 12-06-2016, 10:06 AM
 
Location: Nescopeck, Penna. (birthplace)
12,351 posts, read 7,501,291 times
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The only thing a return to tariffs would do would be to re-ignite the international rivalries and tensions of a century ago, which brought on a global conflict that figured in the deaths of one hundred million human beings. We can't afford this scenario with weapons of mass destruction figured into the equation.

The unfortunate fact remains that the North American monopoly on high technology which emerged at the close of the Second World War is no more, and wages in certain industries favored by that imbalance are going to be competed downward. Get over it and learn to adapt!
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Old 12-06-2016, 10:59 AM
 
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How much would an all American manufactured iPhone cost? How many fewer would they sell at those costs?
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Old 12-06-2016, 11:34 AM
 
Location: Niceville, FL
7,679 posts, read 16,092,150 times
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Given much higher labor costs, manufacturers would instead turn to increasing automation on the factory floor. It's common in a lot of the remaining US factories for any number of goods- yet it's made in the USA and the guys on the floor are making $50K a year, but now it's 17 people making what it took 100 people to do back in the 1950s.

Also, it's not like there's some sort of Insta-Factory-construction where the Cheeto-like one can just wave his magic wand and production begins. You need to develop facilities (and the modern high tech factory has very specific site and location requirements so it's not just any brownfield) and go through permitting, code, and environmental impact statements (making some things like CF lightbulbs is inherently a dirty thing we don't really want anywhere close to people or water supplies) and you have to build your supply chains, and, epending on industry, it's going to be 5-10 years to build from scratch and get a site operational and producing.

During which time you're hiked up prices, and tanked consumer spending, which is what keeps the economy afloat these days.

And then you get the long term economic hit from not allowing production to go where it is most efficient. Look at Brazil, which is one of the most, if not the most protectionist big countries out there. Yes, they've got a useful home-grown auto sector and a few areas where they're pretty competitive globally like commercial aerospace, but prices for consumer goods are insane given wages, and GD per capita is less than 1/4 of GDP per capita in the USA.

Do we really want to take lessons on how to run a country from the mess that is Brazil?

As for the alleged 'laziness' of the American worker, the majority of them are more than glad to work long hard hours for fair compensation but are often held back to part time jobs with screwy hours in he name of an employer not wanting to pay benefits and 'just in time staffing' procedures where an employee is supposed to be on call at all hours for many more shifts than they'll be allowed to work. Walmart was long particularly bad about that for part time hourly employees.
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Old 12-06-2016, 02:07 PM
 
Location: Katy-zuela
4,852 posts, read 8,989,338 times
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Tariffs may create shortages and scarcity of products and selection as many companies may choose simply not sell their products in the U.S. It's going to be like Venezuela, but for an entirely different reason.

This is similar to import-substitution that India did between independence and the early 90's. The current economic boom in that country certainly happened as a result of the early 90's liberalization.
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Old 12-06-2016, 02:30 PM
 
Location: Ohio
19,883 posts, read 14,221,081 times
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Quote:
Originally Posted by cw30000 View Post
I just finished James Rickards's book "The Road to Ruins" and he argued that tariffs could bring back high paying manufacturer jobs. The example he provided in the book is Apple who produces their products in China (where China has both labor and capital advantage) cheap and then sell their products back in the US for big profit. He argued that by imposing a tariffs, it will provide Apple the incentive to build their product in the USA instead of China.
Well, no, corporations off-shored their manufacturing in order to remain competitive globally. The purpose of Carrier moving to Mexico is to be able to compete in the Latin American and South American Markets. If Carrier can produce excess to sell in the North American Market, then that is simply a minor benefit.
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Old 12-06-2016, 04:36 PM
 
Location: Northern California
269 posts, read 154,233 times
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Yes to tariffs! It's the only way we can compete in our own country.

We need a tariff on crude oil. We are currently allowing the Saudi's and the OPEC cartel to sell at a loss to purposely put our own oil companies out of business. We need to get on the road to energy independence by reducing oil imports (implementing a tariff) so our own markets can compete.

Our drilling rigs in the USA are stacked and rusting, my own husband hasn't worked in close to two years and most everyone we know in the oil drilling business has been unemployed for close to three years.
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Old 12-06-2016, 04:43 PM
 
Location: Sugarmill Woods , FL
6,235 posts, read 5,894,156 times
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Don't forget that robots replace people when there is a cost advantage.
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