Tariffs Again

Yes, I am kind of possessed by this tariff thing. The supposed USA Liberation Day was well over a month ago, and I still don't see what it meant. Basically, today we are nearly at the same spot we were before the tariff thing began. The idea of an external revenue service seems to have evaporated. Tariff income is not going to replace income tax and manufacturing is not coming back to the USA. I see no deal being made that ensures the trade between the US and its trading partners will be equal, in fact the only thing I see is that these tariffs are hurting countries that actually had a trade deficit with the USA, or as the idea was announced by the Trump administration, countries that are actually funding the US are getting hit just as much as those that have a trade surplus.

Now, I do believe there must be some benefits to the tariffs, I just really don't see where this benefit is. and today we saw the USA and China reaching something akin to a truce, with both countries vastly reducing tariffs on each others products. The USA is placing 30% tariffs on Chinese goods and China 10% on US goods. Who wins with this? I really don't know, but I do know US consumers will probably be paying more for their Chinese products.

Of course I think the huge US retailers must have reached some compromise with the US administration, perhaps they will absorb part of the tariffs in exchange for some sort of tax write offs. And maybe some Chinese manufacturers will also absorb part of the cost. But I am sure retailers will increase their prices. So customers will be hurt. Now a lot of products that are traded will have no tariffs on them, so I guess what will be hit are consumer goods, mainly in the US. China will probably not tariff food products, because that could be counter productive for them, people don't like to see their food prices go up.

Here in Honduras I have heard of some seafood exporters who have made small price decreases to be able to keep their market share, I think this is not right, many of these companies are not that large and are barely breaking even, these tariffs will hurt them a lot. We also export a lot of bananas and a lot of coffee. Bananas are mostly grown by international corporations so I guess they will get some sort of special treatment, because you know a lot of the shareholders are US citizens, and i really don't think the idea behind the tariffs is to hurt them. Coffee, well we do export a lot of it to Europe so I don't believe that will be much of a problem.

What is certain is tariffs have not been too much of a good thing. Again I think they must have a positive aspect, but I just seem to be missing it.