Skip Navigation
Technology @lemmy.world
Tea @programming.dev

Commerce Secretary Lutnick says tariff exemptions for electronics are only temporary: Lutnick said "semiconductor tariffs" will likely come in "a month or two.".

abcnews.go.com

Commerce Secretary Lutnick says tariff exemptions for electronics are only temporary

Commerce Secretary Howard Lutnick said Sunday that the administration's decision Friday night to exempt a range of electronic devices from tariffs implemented earlier this month was only a temporary reprieve, with the secretary announcing that those items would be subject to "semiconductor tariffs" that will likely come in "a month or two."

"All those products are going to come under semiconductors, and they're going to have a special focus type of tariff to make sure that those products get reshored. We need to have semiconductors, we need to have chips, and we need to have flat panels -- we need to have these things made in America. We can't be reliant on Southeast Asia for all of the things that operate for us," Lutnick told "This Week" co-anchor Jonathan Karl.

61 comments

  • I still don't get the point of tariffs. Here's a Reason TV interview w/ Danial Hannan, a Conservative politician in the UK (bias: Reason TV is a "libertarian" publication), and he says there are three arguments the Trump administration is making in favor of tariffs:

    1. They bring in revenue and can reduce income tax
    2. Bringing jobs back to America
    3. Negotiating tactic

    The interviewee argues all three are wrong, and argues that they're incompatible:

    • if they're bringing in revenue, then they're not bringing in jobs because the imports are still coming in
    • if they're bring back jobs, they're not bringing in much revenue, because local products don't pay the tariffs
    • if they're a negotiating tool they're doing neither of the other two

    Here are some other fun arguments:

    Show me a country that wholly relies on manufacturing and I will show you a poor, developing country. You move from agriculture, then to manufacturing, then to services. And with each of those moves, you get richer, you work shorter hours, and you live better.

    So why would we want to move manufacturing here? It's just going to shift jobs away from services to manufacturing, which would be a net reduction in total value.

    The better solution is to train the workforce to develop services, which are more lucrative. There's an argument that we need some amount of local production for national security reasons (i.e. if supply lines get disrupted, we need some minimum level of production capacity in wartime), but we don't need to make everything.

    • Most of us are not getting richer, nor working shorter hours, nor living better than our parents. We're past "services" and on into "parasites."

      In principal, tariffs can prop up domestic industry that is having trouble competing with cheaper imported products. In practice, this winds up being really complicated, because the world is a lot more interdependent than it was 80 years ago.

      • Is that actually true though? You have access to technology that was science fiction when your parents were kids, and at least in the US (I don't know where you live), median inflation adjusted earnings are higher than they were 45 years ago.

        Statistics obviously don't matter to individuals at the fringes, but they are helpful in understanding trends. Maybe you are worse off than your parents were at your age, idk, but the statistics show that more people are better off than worse off (that's what medians show).

        tariffs can prop up domestic industry

        In theory, yes. In practice, it's a lot more complicated. There's good evidence that Hoover's tariffs, which were intended to revitalize American industry, turned a recession into a depression.

        Tariffs make things more expensive, which means people buy less. If people buy less, companies produce less, which means they need fewer employees. This can become a terrible cycle where demand craters, jobs vanish, and inflation skyrockets. Tariffs can maybe work if targeting a specific industry, broad tariffs just make everything more expensive.

        Economists tend to prefer stimulating the economy with lower borrowing rates, which reduces the cost to expand business, which can lead to more employment, which can lead to more money circulation, etc. It can also lead to more inflation, since there's more dollars chasing the same number of goods, so it needs to be used with care (i.e. only when production/employment is lagging).

        I personally think that, largely speaking, if imports are cheaper than local production, that's a good thing! You're getting more value for your money, so people can live a better life with the same amount of money. Since local production is no longer valuable, people can take more lucrative jobs, like services. Cheaper imports should be embraced, not tariffed, and people should be trained properly to qualify for those better jobs.

        Look at the top 10 exports:

        1. Mineral fuels including oil: US$320.1 billion (15.5% of total exports)
        2. Machinery including computers: $252.4 billion (12.2%)
        3. Electrical machinery, equipment: $213.9 billion (10.4%)
        4. Vehicles: $143.8 billion (7%)
        5. Aircraft, spacecraft: $134.2 billion (6.5%)
        6. Optical, technical, medical apparatus: $106.3 billion (5.1%)
        7. Pharmaceuticals: $94.4 billion (4.6%)
        8. Plastics, plastic articles: $80.1 billion (3.9%)
        9. Gems, precious metals: $73.8 billion (3.6%)
        10. Organic chemicals: $51.9 billion (2.5%)

        Those require a lot of expertise to produce, and they're largely complex, finished goods. That means there's a lot of non-factory type work that goes into them, unlike iPhones and plastic crap, which are mostly labor (the technical bits are already largely designed by Americans).

        We should be looking to outsource more (anything we can't automate), not less, and use the savings to improve education. If you want better jobs, more access to advanced tech, and generally a better life, this is how you get it.

61 comments