this post was submitted on 24 Jan 2025
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Summary

In a virtual speech at the World Economic Forum, Trump suggested Canada could become a U.S. state to avoid his proposed tariffs on imports.

The remark elicited gasps from the audience.

Trump claimed the U.S. does not need Canadian lumber, energy, or vehicles, vastly overstating the trade deficit between the two nations.

He reiterated his intention to impose tariffs, potentially as high as 25%, on imports from Canada and Mexico starting February 1.

Economists warn such tariffs would raise prices for U.S. consumers.

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[–] victorz 4 points 11 hours ago (3 children)

Isn't the point to make the domestic customers choose products from other nations? Why wouldn't that be a threat to the nation that is selling?

[–] [email protected] 1 points 1 hour ago

Yeah but it only really works if it's targeted. Threatening blanket tariffs on countries that represent 60% of all imports (EU, China, Mexico, Canada) takes a bit of the impact away, it's unlikely domestic production could handle all that. Even if it could, why wouldn't American companies raise their prices as much as they felt they now could?

[–] [email protected] 3 points 6 hours ago

I think it's a "threat" but not a very good one.

There might be 3 brands of toothbrush available to buy in the US but maybe all of them are manufactured in China. If you just tariff everything from China then US consumers will just pay more because there's no incentive for manufacturers to absorb the tariff.

It's a threat to Chinese toothbrush manufacturers because it creates an incentive for other manufacturers to pop up elsewhere, maybe someone will start manufacturing toothbrushes in the US. These toothbrushes would be cheaper than the tariffed ones for consumers to buy, but obviously more expensive than toothbrushes used to be before the tariffs.

In summary, because consumers are unlikely to buy less toothbrushes, they just end up paying more.

[–] finitebanjo 1 points 11 hours ago (1 children)

Idk but Trump just tried to threaten Canada with them so clearly some Americans don't know.

[–] victorz 2 points 6 hours ago

Sorry, you lost me there.