this post was submitted on 27 Nov 2024
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Explain Like I'm Five
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A caveat. In your scenario, there is apparently only one widget maker in each country and they have a monopoly?
If widgets could be made in the US for $7 and sustainably priced at $9 to be a viable business, then they wouldn't be selling them for $16.99, because ten other US businesses would start up selling widgets for less.
Tariffs don't work for everything, but how many jobs in the US are in making something? What would you have of them? Because in the US you need like $25 an hour to make a living and we have health and safety implementations and labor laws. China pays their employees $2 an hour. They can undercut anything we could make in the US.
A small widget manufacturer attempting that would get bought out by a larger widget manufacturer because anti-trust laws are unenforced. A mid-size or large widget manufacturer would make more money by not doing that and instead forming a widget cartel with the other larger manufacturers because anti-cartel laws are unenforced.