The Stock Market drops – tariffs help that to happen.
About 18 months ago I wrote a piece stating that #NoTariff is Good – They are a Can of Worms. I wrote this prior to any tariffs being implemented on goods imported to our country. My intent was to help with the understanding that a tariff placed by a government is essentially a tax on its own people. It is simple:
- The tariff (tax) is placed on goods that are imported into the United States
- Businesses who purchase those goods pay the tax to receive the goods
- Businesses raise their prices because of their higher costs
- Consumers pay the higher cost due to the tax imposed on the imports
- Essentially the consumer has paid the tax with the business operating as a conduit for the payment
- Businesses that do not pass on a 10% – 25% cost increase…don’t survive
We now have arrived at a point where virtually all goods from China are being taxed with threats by the President that those Tariffs will increase. While the economic Neanderthals surrounding the President claim that the tariffs will do little to harm the overall economy their claims ignore that they will harm the end consumers (i.e., all of us) and the tariffs don’t conform to sound economic policy.
So why then, after following policies of free trade, no tariffs and low taxation are Republicans so silent on the imposition of these economically harmful tariffs? I saw this and I think it explains what is going on…
Let’s make it clear to Congress that tariffs will cause financial pain for the average American and those who allow or impose them at any level of the government do so at their political peril.