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Someone help me out with the freak out over the steel/aluminum deal?

If you look into the auto industry, Ford and GM will,each be looking at a billion dollar a year materials price increase. How do you think that increase passes along? I will tell you that the tire industry buys zero US steel, because no one in the US makes the product. That is a 100 million dollar material increase and the product still comes from out the country. It would be great to have US sourced product, but the US typically is from recycled ore and is not of the quality of mined ore.

The thing is that steel is not on a tariff if it is in a manufactured product so vehicles, and tires and other products coming into the country with steel in them now have built in materials cost advantage over US product. Multinational companies have an incentive to produce outside the US and ship in to save tariff cost. There were tariffs set for truck tires from China last year but Trump had them killed. So for Chinese tires, they get no tariff at all even while selling product below material cost because they have Chinese government assistance and now on top, the US made products have to pay 20% more in materials cost than the Chinese. Lose - lose for US production

As soon as the proposal of tariffs were announced, suppliers immedidialy started to raise the prices of materials. Aluminum companies have already raised there prices 10% even before the announcement to match the tariff priced product.

All and all, the cost of a ton of products go up immediately and that is passed on to the consumer. Mean time, the tariff is a nice little tax for the government to have.

All of this and on time, the other countries are pissed you are putting stress on their products and start a trade war. US products get tariffs going into their countries and other industries suffer.
 
I believe China is the 11th ranked importer of steel into the US. The majority of the top 10 are allied countries, with Canada #1.

State Department arguments aside, the two main objections are the employment and fiscal impact to the American public (workers in metal-consuming industries outnumber steel/alum workers by 40:1) and the looming trade war which will cause American goods to be taxed higher (and thus priced higher) abroad.
 
If you look into the auto industry, Ford and GM will,each be looking at a billion dollar a year materials price increase. How do you think that increase passes along? I will tell you that the tire industry buys zero US steel, because no one in the US makes the product. That is a 100 million dollar material increase and the product still comes from out the country. It would be great to have US sourced product, but the US typically is from recycled ore and is not of the quality of mined ore.

The thing is that steel is not on a tariff if it is in a manufactured product so vehicles, and tires and other products coming into the country with steel in them now have built in materials cost advantage over US product. Multinational companies have an incentive to produce outside the US and ship in to save tariff cost. There were tariffs set for truck tires from China last year but Trump had them killed. So for Chinese tires, they get no tariff at all even while selling product below material cost because they have Chinese government assistance and now on top, the US made products have to pay 20% more in materials cost than the Chinese. Lose - lose for US production

As soon as the proposal of tariffs were announced, suppliers immedidialy started to raise the prices of materials. Aluminum companies have already raised there prices 10% even before the announcement to match the tariff priced product.

All and all, the cost of a ton of products go up immediately and that is passed on to the consumer. Mean time, the tariff is a nice little tax for the government to have.

All of this and on time, the other countries are pissed you are putting stress on their products and start a trade war. US products get tariffs going into their countries and other industries suffer.

What do you do for a living?
 
Trump stated he was going to put America first and stop letting other countries, especially China be the beneficiary of these outrageous trade deals.

He may be just flexing his businessman muscle here and using this as a bigger play somewhere else. I, for one, hope he goes through with it.
A tariff is a tax, and higher taxes are not the answer. Reagan said if one person shoots a hole in the boat I’m not going to respond by shooting another hole in the boat. I’m slightly paraphrasing, but the point is don’t exacerbate the problem. The EU’s proposal could amount to $3.52 billion in retaliatory tariffs. And with some historical perspective, the last time the US imposed steel tariffs it actually ended up being a negative for US steel producers.

Basically, Trump’s wife said I’m not going to have sex with you and so the Don is saying well I’m not going to have sex with you more. Nobody wins at that game. Instead we should all be having sex, but Trump apparently doesn’t want Americans to have sex.
 
I'll explain it like you're 5.

We lose $5 on the trade of steel, but make $10 on the back end when the companies pay their taxes via increased revenue.
 
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Wow. What kind of steel does he use?
You are not going to like this answer.

Hot roll carbon. The reason being the steel mills are going to make out like bandits. They know the foreign mills will no longer be able to provide a competitively priced product to the US consumer base, and so the US mills are going to drive prices up.

Edit: ask and blame @Redbull7 his company is one of the big mills that will drive the prices up.
 
When 40 jobs depend on buying a core material at a price that makes the products they produce and sell competitive, and 1 job depends on manufacturing that core material, you tell me who wins and loses the most jobs when the price of that material goes up? It's basic economics that a 5th grader should be able to comprehend. That's why Gary Cohn, Trump's Chief Economic advisor, just resigned.

Add in the fact that other goods we export, not just the ones with steel and aluminum, will receive retaliatory tariffs from other countries and the impacts are massive comparitaviely. The US represents about 5% of the world's population. That means 95% of the world's customers are going to pay more for many American goods than they were before. Food exports, vehicles, technology, etc. How is that good for American businesses who export and how is that good for their workers? There is this thing called supply and demand. When price goes up, demand falls. When demand falls, workers lose jobs and our economy slows.

And I haven't even talked about the fact that this tax effectively is passed on to every American in the price increases you will see on the goods you purchase.

The sad part is that the above is just a fraction of the reason in the most basic terms that this is insanity. It's not rocket science. This is all about Trump appealing to a base that doesn't understand even the most basic economics.
 
Yeah.. the fact that china puts a 25% tariff on autos from the US and our tariff is 5% seems completely sane to me...Europe has tons of tariffs on US products. Trump did it to get some attention to "real trade practices."

Oh, and the people that are saying it will be a 50% increase to steel need to do the math along with the guys spouting off about autos.

Maybe we should just let them make cheap cars with cheap steel and aluminum in China and then we can tax it 5%.
 
A tariff is a tax, and higher taxes are not the answer. Reagan said if one person shoots a hole in the boat I’m not going to respond by shooting another hole in the boat. I’m slightly paraphrasing, but the point is don’t exacerbate the problem. The EU’s proposal could amount to $3.52 billion in retaliatory tariffs. And with some historical perspective, the last time the US imposed steel tariffs it actually ended up being a negative for US steel producers.

Basically, Trump’s wife said I’m not going to have sex with you and so the Don is saying well I’m not going to have sex with you more. Nobody wins at that game. Instead we should all be having sex, but Trump apparently doesn’t want Americans to have sex.
His wife definitely wins in that scenario
 
When 40 jobs depend on buying a core material at a price that makes the products they produce and sell competitive, and 1 job depends on manufacturing that core material, you tell me who wins and loses the most jobs when the price of that material goes up? It's basic economics that a 5th grader should be able to comprehend. That's why Gary Cohn, Trump's Chief Economic advisor, just resigned.

Add in the fact that other goods we export, not just the ones with steel and aluminum, will receive retaliatory tariffs from other countries and the impacts are massive comparitaviely. The US represents about 5% of the world's population. That means 95% of the world's customers are going to pay more more many American goods than they were before. Food exports, vehicles, technology, etc. How is that good for American businesses who export and how is that good for their workers? There is this thing called supply and demand. When price goes up, demand falls. When demand falls, workers lose jobs and our economy slows.

And I haven't even talked about the fact that this tax effectively is passed on to every American in the price increases you will see on the goods you purchase.

It's not rocket science. This is all about Trump appealing to a base that doesn't understand even the most basic economics.

Hahaha. Wow
 
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When 40 jobs depend on buying a core material at a price that makes the products they produce and sell competitive, and 1 job depends on manufacturing that core material, you tell me who wins and loses the most jobs when the price of that material goes up? It's basic economics that a 5th grader should be able to comprehend. That's why Gary Cohn, Trump's Chief Economic advisor, just resigned.

Add in the fact that other goods we export, not just the ones with steel and aluminum, will receive retaliatory tariffs from other countries and the impacts are massive comparitaviely. The US represents about 5% of the world's population. That means 95% of the world's customers are going to pay more more many American goods than they were before. Food exports, vehicles, technology, etc. How is that good for American businesses who export and how is that good for their workers? There is this thing called supply and demand. When price goes up, demand falls. When demand falls, workers lose jobs and our economy slows.

And I haven't even talked about the fact that this tax effectively is passed on to every American in the price increases you will see on the goods you purchase.

It's not rocket science. This is all about Trump appealing to a base that doesn't understand even the most basic economics.

Why would other countries import us steel if it’s more expensive than foreign competitors (I’m talking pre-tariff)?
 
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The media has everyone thinking that Trump is stupid. This is his “game” this is what he does. I personaly think that he knows exactly what he’s doing and I trust him in these matters. Our low life pathetic politicians have Royally screwed this country (for personal gain) when making all of these trade deals and I am thrilled to death that Trump is doing something about it.
 
Why would other countries import us steel if it’s more expensive than foreign competitors (I’m talking pre-tariff)?
They won't, unless the quality is just that superior. But these tarriffs don't change that. Tariffs only impact the price of goods coming into our country, purchased by American companies. It doesn't lessen the price of the steel we export (which isn't a big export) or raise the price other countries pay for their steel. Trump doesn't have the power to place tariffs on goods going into other countries.
 
The media has everyone thinking that Trump is stupid. This is his “game” this is what he does. I personaly think that he knows exactly what he’s doing and I trust him in these matters. Our low life pathetic politicians have Royally screwed this country (for personal gain) when making all of these trade deals and I am thrilled to death that Trump is doing something about it.
Why do you think Trump is doing anything different? His company has made money hand over fist since being elected at a rate that should make life long politicians blush.
I really don't understand the good will confidence he inspires in people. It baffles me. I could point to all his failures, but him winning the election, a popularity contest, somehow washes him of any faults. Outside of that people just say at least its not Hillary.
 
This will be interesting since the company I work for imports steel from Korea and Turkey. We do get some from California but it’s way more expensive from what I’ve been told by our purchasing group.
 
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Yeah.. the fact that china puts a 25% tariff on autos from the US and our tariff is 5% seems completely sane to me...Europe has tons of tariffs on US products. Trump did it to get some attention to "real trade practices."

Oh, and the people that are saying it will be a 50% increase to steel need to do the math along with the guys spouting off about autos.

Maybe we should just let them make cheap cars with cheap steel and aluminum in China and then we can tax it 5%.

I was "the people" saying steel will increase by 50%, how can I help. I also said "predicted" forecasts, since you apparently have difficulty with reading comprehension. My prediction comes from a purchasing agent that works for a steel fabrication company. He has been in the metals industry his whole career and never seen hot roll steel raw materials approach $1.00/lb before. Current prices are at $.47/lb, predicted prices are to exceed $1.00, so I guess I was wrong, over 50%.
 
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Why would other countries import us steel if it’s more expensive than foreign competitors (I’m talking pre-tariff)?

It isn't exported steel it is retaliatory tariffs on other products.

For instance EU has talked about increasing their tariffs on bourbon, Levi, Harley-Davidson, etc. If the price of those products go up by the amount of the tariff in the EU then the US producers of the products will sell less of them and thus negatively affect the those businesses and the employees that work with them in the US.

China is already investigating a tariff on sorghum, which the import $6 Billion worth from the US in response to the tariff on Chinese solar panels, so this tick-for-tack retaliation benefits nobody. Solor panels now cost more in the US, US could lose our on a valuable market for a profitable crop in sorghum.

The best case is you just have a 25% tariff on steel with no retaliation from other countries and what is the upside there? The companies that manufacturer steel win at the expense of everybody in the US that buys steel. Basically US consumers dollars are paying to prop up the steel industry.
 
A tariff is a tax, and higher taxes are not the answer. Reagan said if one person shoots a hole in the boat I’m not going to respond by shooting another hole in the boat. I’m slightly paraphrasing, but the point is don’t exacerbate the problem. The EU’s proposal could amount to $3.52 billion in retaliatory tariffs. And with some historical perspective, the last time the US imposed steel tariffs it actually ended up being a negative for US steel producers.

Basically, Trump’s wife said I’m not going to have sex with you and so the Don is saying well I’m not going to have sex with you more. Nobody wins at that game. Instead we should all be having sex, but Trump apparently doesn’t want Americans to have sex.
She wins
 
They won't, unless the quality is just that superior. But these tarriffs don't change that. Tariffs only impact the price of goods coming into our country, purchased by American companies. It doesn't lessen the price of the steel we export (which isn't a big export) or raise the price other countries pay for their steel. Trump doesn't have the power to place tariffs on goods going into other countries.

Right. So if it’s only going to indirectly impact exports it should improve the trade deficit?

The global economy needs America to consume. We have the leverage, not the communists.
 
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The media has everyone thinking that Trump is stupid. This is his “game” this is what he does. I personaly think that he knows exactly what he’s doing and I trust him in these matters. Our low life pathetic politicians have Royally screwed this country (for personal gain) when making all of these trade deals and I am thrilled to death that Trump is doing something about it.

The bluster that the media decries is all about setting a negotiating position. It is always better to negotiate from a position of strength. Has anyone noticed that North Korea is now talking about giving up their nuclear weapons? When threatened by Kim, Trump said "I have a button too & mine is bigger". What would their response have been if he had said "Oh please Sir don't use those big bad weapons on us"?
 
I have to admit at first I was for it without knowing enough to have an opinion. My problem is do we just except we will always be on the losing end of fair trade????
 
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