Who really believes tariffs are good business

Fah Kiew Tu

Curmudgeon, First Rank
10,130
3,276
Tasmania, Australia
Mismoyled Jiblet. said:
Of course you do Cliff.

Which is why part of this trade tiff is about Chinese subsidies for steel and aluminum that allow us to buy it for less than the producers cost absent government subsidies.
If that were actually true, you should buy heaps of it & stockpile, because you'll be removing money from the source that they could use to do other things and saving your own in the process.

The problem a lot of you seem to have a hard time with is, an ability to sell at a lower price than your domestic suppliers does not *necessarily* mean that item is subsidised. Often your domestic suppliers simply have higher local costs or want a substantially higher profit margin. The Japanese were really good at this - vertically integrated, cheap loan money and a focus on where they wanted to be 10 years out rather than next quarter's P&L statement. US industry self-destructed by focus on really short term and outsourcing everything they could. Pity the IP on how to make stuff transfers too and those pesky competitors go into business on their own account. Meanwhile you've pissed away your lead in the expertise and no longer have the trained people needed to actually make stuff.

A USA manufactured plasma cutter in the 3 phase 120A range (ie not a home hobby toy) is priced at a bit more than 5X the price of a Chinese one. The US made unit is better, but it's not 5X better. Ditto for my heavy duty welder. OTOH my big lathe is a superb piece of work and was made in the USA. Unfortunately it was made in 1942 and nobody, anywhere in the USA, for any price, makes an equivalent machine. Fair enough too in a lot of ways, CNC lathes are better for modern production purposes. Pity most of those come from outside the USA as well.

Metals are freely traded & priced on international exchanges. Subsidies would be pretty obvious. There doesn't seem to be much evidence out there.

FKT

 

Fah Kiew Tu

Curmudgeon, First Rank
10,130
3,276
Tasmania, Australia
Mismoyled Jiblet. said:
So tariffing Chinese aluminium might be arguable. What about Canadian aluminium?

As for steel, shrug, I'm just as selfish an arsehole as you guys - we sell China a heap of iron ore & coal, the more steel they sell, the more they buy from us. I'm good with that.

FKT

 

mikewof

mikewof
45,640
1,212
My experience has been that corporate bosses are among the worst offenders for that sort of illiteracy.
That boss introduced me to desktop publishing back in the early 1990s. Before getting into corporate communication he was an actor, so precision of words were important to him.

I learned from him that a college degree program in theater and drama might be one of the most valuable programs for business. I have a daughter who enjoys that stuff, she'll probably make 10x what her old man makes.

Any actor who spends their time as a waiter or waitress and doesn't explore business might be missing out on a part that pays well and might be a lot of fun.

 

mikewof

mikewof
45,640
1,212
Mismoyled Jiblet. said:
Of course you do Cliff.

Which is why part of this trade tiff is about Chinese subsidies for steel and aluminum that allow us to buy it for less than the producers cost absent government subsidies.
I'm no longer sure what you're even arguing.

I do know however, that a tax and a tariff are different, and the thing you claim as a "subsidy" to the USA is most likely just regular ol' commerce with little actual evidence of any country losing money on a product to make us wealthier, as a subsidy would require. I suspect that REEs have been sold at very low profits at various points, but that's likely for them to maintain market share.

 

Fah Kiew Tu

Curmudgeon, First Rank
10,130
3,276
Tasmania, Australia
Mismoyled Jiblet. said:
Canadian aluminum tariffs are stupid.

I agree with your latter point, no reason for you to care (yes, I edited the post coincident with your reply).
I've spent far too much time arguing this stuff on a metalworking & manufacturing forum. I'm actually bloody exasperated with the USA manufacturing because I and a lot of other people would *prefer* to buy from you.

The reasons we don't are (in no particular order):

You don't make shit at any sort of world-competitive price. The Germans & Swiss have a lock on the really high quality, high cost market. The Japanese & Koreans own the next tier down and China is catching up.

You import stuff from somewhere else, slap a US label on it and then try to re-sell it for 5X or more the price so as to boost profits. That's simply an insult to everyone's intelligence - your idiots think marketing is king. So we buy from the source and your companies lose business.

A lot of what you actually *do* make is not designed for export, it's just an afterthought spillover from domestic manufacturing. And it shows. This leads to.....

a small point perhaps but important - for whatever incomprehensible reason you stubbornly REFUSE to adopt the metric system and use SI units like every other 1st World country does (plus all the 2nd & 3rd World). This is *particularly* pissing me off ATM because there's a man at the local marina (cruiser type) that needs some new fittings made for his mast and they're all in archaic dimensions and threads. I can make them - I can screw-cut any thread known to mankind - but it's a real PITA to do so and more expensive in time as well.

Funnily though I'm rebuilding my made in 1942 Monarch CY lathe ATM because it is a wonderfully well built machine, still capable of decent work after all these years. But you literally don't make stuff like this any more. I sincerely wish you did.

FKT

 

mikewof

mikewof
45,640
1,212
If that were actually true, you should buy heaps of it & stockpile, because you'll be removing money from the source that they could use to do other things and saving your own in the process.

The problem a lot of you seem to have a hard time with is, an ability to sell at a lower price than your domestic suppliers does not *necessarily* mean that item is subsidised. Often your domestic suppliers simply have higher local costs or want a substantially higher profit margin. The Japanese were really good at this - vertically integrated, cheap loan money and a focus on where they wanted to be 10 years out rather than next quarter's P&L statement. US industry self-destructed by focus on really short term and outsourcing everything they could. Pity the IP on how to make stuff transfers too and those pesky competitors go into business on their own account. Meanwhile you've pissed away your lead in the expertise and no longer have the trained people needed to actually make stuff.

A USA manufactured plasma cutter in the 3 phase 120A range (ie not a home hobby toy) is priced at a bit more than 5X the price of a Chinese one. The US made unit is better, but it's not 5X better. Ditto for my heavy duty welder. OTOH my big lathe is a superb piece of work and was made in the USA. Unfortunately it was made in 1942 and nobody, anywhere in the USA, for any price, makes an equivalent machine. Fair enough too in a lot of ways, CNC lathes are better for modern production purposes. Pity most of those come from outside the USA as well.

Metals are freely traded & priced on international exchanges. Subsidies would be pretty obvious. There doesn't seem to be much evidence out there.

FKT
The point about the U.S. or Canadian made machine is that some industries wouldn't consider saving that 5x on the Asian machine, because downtime costs them 10x or more, and the Asian machines can't often guarantee the supply chain or site maintenance expertise. 

Given that, those old American tools are incredible and sought after like mad here on this side of the pond. An old Bridgeport mill can and will sell for more than it sold new. When my dad sold his 1950s era turret lathe, made in New Jersey, he had Colorado gunsmiths lined up to buy it.

And yeah, we pissed away our lead. But so did Australia and England. Germany would have done the same thing except their language (along with Italy and Spain) prevented them somewhat from selling off their manufacturing to make quick cash in finance and service economy stuff.

 

mikewof

mikewof
45,640
1,212
I've spent far too much time arguing this stuff on a metalworking & manufacturing forum. I'm actually bloody exasperated with the USA manufacturing because I and a lot of other people would *prefer* to buy from you.

The reasons we don't are (in no particular order):

You don't make shit at any sort of world-competitive price. The Germans & Swiss have a lock on the really high quality, high cost market. The Japanese & Koreans own the next tier down and China is catching up.

You import stuff from somewhere else, slap a US label on it and then try to re-sell it for 5X or more the price so as to boost profits. That's simply an insult to everyone's intelligence - your idiots think marketing is king. So we buy from the source and your companies lose business.

A lot of what you actually *do* make is not designed for export, it's just an afterthought spillover from domestic manufacturing. And it shows. This leads to.....

a small point perhaps but important - for whatever incomprehensible reason you stubbornly REFUSE to adopt the metric system and use SI units like every other 1st World country does (plus all the 2nd & 3rd World). This is *particularly* pissing me off ATM because there's a man at the local marina (cruiser type) that needs some new fittings made for his mast and they're all in archaic dimensions and threads. I can make them - I can screw-cut any thread known to mankind - but it's a real PITA to do so and more expensive in time as well.

Funnily though I'm rebuilding my made in 1942 Monarch CY lathe ATM because it is a wonderfully well built machine, still capable of decent work after all these years. But you literally don't make stuff like this any more. I sincerely wish you did.

FKT
Uh dude ... Mismoyled Giblet or whatever is about as American as Coon Cheese and Tooheys Extra Dry.

Given that, you have a good point about our industrial machines, but remember these are not our core machines anymore.

If you want world class deposition equipment, nanoscale manufacturing gear, laser shock peening, ion etching, neutron sensing gear for airport security, hardened satellite systems, advanced wave guides and all the other detrius from the 2020 era economy, we still make some of the best stuff and at oddly competitive pricing.

 
Last edited by a moderator:

warbird

Super Anarchist
16,607
1,359
lake michigan
Mismoyled Jiblet. said:
US on chinese aluminumhttps://www.reuters.com/article/us-usa-trade-aluminum/u-s-finds-china-aluminum-foil-imports-dumped-subsidized-idUSKCN1GB2QQ

EU on chinese steelhttps://www.politico.eu/article/opinion-china-steel-trade-no-winners-in-europe-war-against-chinese-steel-market-anti-dumping-imports/

edit below: the evidence is pretty obvious - perhaps not in oz, because you've a vested interest in supplying china with supplies.

that the US doesn't have anyone trained to make shit anymore, much less the supply chain infrastructure, is an inescapable truth. Trumplicans war against academia & immigrants makes the problem for manufacturers even worse
ur kinda a dmg fuk…..

 

Fah Kiew Tu

Curmudgeon, First Rank
10,130
3,276
Tasmania, Australia
Uh dude ... Mismoyled Giblet or whatever is about as American as Coon Cheese and Tooheys Extra Dry.

Given that, you have a good point about our industrial machines, but remember these are not our core machines anymore.

If you want world class deposition equipment, nanoscale manufacturing gear, laser shock peening, ion etching, neutron sensing gear for airport security, hardened satellite systems, advanced wave guides and all the other detrius from the 2020 era economy, we still make some of the best stuff and at oddly competitive pricing.
That's wonderful (and I'm not disputing you).

How well is that sort of stuff going to work if or when China cuts off the source of rare earths?

Frankly if you were serious about protecting defence critical industries you'd be tariffing the fuck out of Chinese rare earths to get your domestic manufacturers off of their arse & make your own. Steel & aluminium are commodities. Rare earths aren't and the Chinese have a lock on the supply. Guess where they got the tech from in the first place?

I think the USA *should* tariff China on a number of items, to be honest. The Chinese are a bunch of mercantilist exploiters with no respect for IP in particular. However you guys gave them all the tools they needed to get there.

I'm well aware the USA can make some first class equipment - a lot of the oceanographic sampling gear I used to be responsible for was made in the USA. It's one of the reasons I'm so pissed off at your abdication from huge areas of the world marketplace.

FKT

 

mikewof

mikewof
45,640
1,212
That's wonderful (and I'm not disputing you).

How well is that sort of stuff going to work if or when China cuts off the source of rare earths?

Frankly if you were serious about protecting defence critical industries you'd be tariffing the fuck out of Chinese rare earths to get your domestic manufacturers off of their arse & make your own. Steel & aluminium are commodities. Rare earths aren't and the Chinese have a lock on the supply. Guess where they got the tech from in the first place?

I think the USA *should* tariff China on a number of items, to be honest. The Chinese are a bunch of mercantilist exploiters with no respect for IP in particular. However you guys gave them all the tools they needed to get there.

I'm well aware the USA can make some first class equipment - a lot of the oceanographic sampling gear I used to be responsible for was made in the USA. It's one of the reasons I'm so pissed off at your abdication from huge areas of the world marketplace.

FKT
First off, we are gradually building REE sourcing, it's happening slowly, but it's happening. It's happening slowly because we're not taking China's approach, which is pretty much the dirtiest possible approach of just stripping ore out of the ground, using batch processing to get what they need and then dumping the rest. Instead, we're taking a low-entropy approach (thank goodness) of combining the REE extraction using forms of in-situ leach with geothermal energy, oil and gas exploration, and possibly even ocean power. But for now, that gear is as dependent on REEs as any other machine that has microprocessors and advanced batteries. They could cut off the flow of components for iPhones, and it would cripple iPhone, but their needs are 1000x of the components as these, and the delivery of advanced engineering stuff isn't as critical time sensitive, they can always source a few hundred microprocessors or batteries.

Why are steel and aluminum commodities and REEs not? And I'm not really worried about steel and aluminum, we can add that capability as needed. I'm more worried about titanium refining, that's an area that we've "abdicated" and left to Eastern Europe. The last time I checked, there was one actual titanium refiner in the USA, and I'm not even sure of the actual capacity in that operation. I think most of what we have here processes the already refined titanium, it's some incredibly difficult stuff to refine, and incredibly common to source, beaches are full of the stuff.

 

Fah Kiew Tu

Curmudgeon, First Rank
10,130
3,276
Tasmania, Australia
Why are steel and aluminum commodities and REEs not? And I'm not really worried about steel and aluminum, we can add that capability as needed. I'm more worried about titanium refining, that's an area that we've "abdicated" and left to Eastern Europe. The last time I checked, there was one actual titanium refiner in the USA, and I'm not even sure of the actual capacity in that operation. I think most of what we have here processes the already refined titanium, it's some incredibly difficult stuff to refine, and incredibly common to source, beaches are full of the stuff.
REE's aren't commodities for the obvious reason - limited volume and limited sources. As you well know.

You guys still do make a lot of steel. Some of the specialty steels come from overseas, that's a function of volume as well. It makes far more sense for Canada to make aluminium, it's basically frozen electricity and vast amounts of hydro power plus bauxite give wonderful synergies.

That was the problem with Trump's tariffs - they actually made no sense for a lot of things on the list. Nobody is going to build steel plants like those in the 1950's - you guys make pretty much the same tonnage now as then with something like 1/20 of the workforce. That isn't going to change.

Got to admit I'm sitting in the cheap seats watching the show. If China has to stop some of its more outrageous practices that'll be good for everyone. OTOH so would consigning the Mickey Mouse copyright issue to the bin, plus the endless attempts by the big pharma companies to 'evergreen' patents by making minor tweaks and attempting to withhold clinical trial data. Not to mention doing their best to get the USA to heavy us & others about bargaining for better prices on drugs for our pharmaceutical benefits system. So basically my attitude is 'a pox on both of you' because neither party has clean hands. At least China isn't as hypocritical - and they buy lots of red & black dirt off of us. Our US-Australia trade imbalance is massively in your favour so by Trump's logic we should tariff all your exports to us.   Bet that'd go down well......

FKT

 
G

Guest

Guest
Regardless. Please.

unless you like being clunky:

Irregardless is a nonstandard synonym for regardless, which means “without concern as to advice, warning, or hardship,” or “heedless.” Its nonstandard status is due to the double negative construction of the prefix ir- with the suffix -less. ... The bottom line is that irregardless is indeed a word, albeit a clunky one.
I deliberately use it because I know it annoys many of you here.  As evadent.  :D

 
Last edited:
G

Guest

Guest
That said...there has to be some sort of happy medium in there somewhere. Have to deliver the bad news with a plan, and emphasis on the plan. Unfortunately there has to be the gentle but firm assertion that some people are ignorant in there somewhere too. That takes time for explanerating. Have to get away from the sound-bite addicted press to do much of that or they will fuck ya every time. 
Totally agree.  And the last part about the press is the tricky one.  But it's not just the sound bite addicted press, it's also the short attention span electorate who would struggle to last much past a 30 sec sound bite.  Chicken or egg?  

 

Steam Flyer

Sophisticated Yet Humble
44,405
9,672
Eastern NC
BillDBastard said:
....     ...     ...

So if you please, do not consider me like the rest of you partisan hacks in here. You all are the problem, both sides of the aisle. And until you all stop pointing at the other side and declaring them the root of all evil, nothing will change....   ...    ...
8q1a06.jpg


-DSK

 

mikewof

mikewof
45,640
1,212
REE's aren't commodities for the obvious reason - limited volume and limited sources. As you well know.

You guys still do make a lot of steel. Some of the specialty steels come from overseas, that's a function of volume as well. It makes far more sense for Canada to make aluminium, it's basically frozen electricity and vast amounts of hydro power plus bauxite give wonderful synergies.

That was the problem with Trump's tariffs - they actually made no sense for a lot of things on the list. Nobody is going to build steel plants like those in the 1950's - you guys make pretty much the same tonnage now as then with something like 1/20 of the workforce. That isn't going to change.

Got to admit I'm sitting in the cheap seats watching the show. If China has to stop some of its more outrageous practices that'll be good for everyone. OTOH so would consigning the Mickey Mouse copyright issue to the bin, plus the endless attempts by the big pharma companies to 'evergreen' patents by making minor tweaks and attempting to withhold clinical trial data. Not to mention doing their best to get the USA to heavy us & others about bargaining for better prices on drugs for our pharmaceutical benefits system. So basically my attitude is 'a pox on both of you' because neither party has clean hands. At least China isn't as hypocritical - and they buy lots of red & black dirt off of us. Our US-Australia trade imbalance is massively in your favour so by Trump's logic we should tariff all your exports to us.   Bet that'd go down well......

FKT
First, I'm not clear on why you don't consider REEs a commodity ... The sources aren't limited, every region in the world that I know has lots of them, because there are so many different kinds. We have plenty of them in the USA, as do you in Oz. The reason so few countries produce them is because China is selling them cheap, and also because it's incredibly difficult to extract them since they don't vein in epithermal vents like gold, copper and silver. It's even more expensive to extract them from all that ore in a clean way, which even China doesn't bother doing.

REEs are a key manufacturing component like steel and polymers, why does the volume even matter? By that logic, I could argue that steel isn't a commodity because the volume used in industry is insignificant compared to the volume of water needed to make the energy to run industrial processes. Do you consider water a commodity?

As for the Australian - US trade imbalance, your population is so tiny there, I'm not sure that any additional tariffs on U.S. products would even register much more than a blip here.

But part of the reason you have a trade imbalance with us is similar to the reason we have a trade imbalance with China, because your population is small compared to our's, just as our population is small compared to China's. We can't justify a lot of industries anymore. For instance with the machines you love, if we committed our engineers to making that kind of product we wouldn't be able to compete with India and China anyway, so we commit to more advanced machines like ellipsometers and neutron etching gear.

Australia can't compete with the USA in every area, so you folks concentrate on a handful of super advanced industries like mining automation and quantum optics. You and I discussed this some time ago regarding CSIRO funding.

As for Trump's tariffs, I agree that they could have been done much better, but this is what happens when someone assembles a team based on politics rather than expertise! Obama got the best people for thy job, Trump doesn't always do that. Sometimes he gets lucky, and -- for instance -- his politically motivated pick for DOE head turned out to be a rockstar. But luck isn't common.

This is roughly the same reason why a Canadian hockey team can't bring home a Stanley Cup for over 25 years ... because it's their national sport, and they tend to slightly favor Canadian players. The USA fans don't care, there is little nationalism for hockey in places like LA, Denver, Detroit, Pittsburgh, Tampa, etc., they fill lines as needed with Finns, Russians, Canadians, Czechs. 

Finally, your comparison between China and the USA is kind of silly. We don't buy as much "red and black dirt" from you because the shipping would suck, our West Coast doesn't tend to need a lot of that, we need it on our East Coast. And we buy the high value stuff from you, with which there is an actual future, like medical technology, computing, media and advertising.

 




Top