> but many on this very site would need to give up a little bit of their privilege to reduce the pain felt by many of their fellow citizens.

Agreed. However, by imposing tariffs it is not the privileged who are going to be affected the most. The pain is felt most by the low-skill workers you mentioned earlier.

If the solution was instead along the lines of changing tax-brackets to tax the 'privileged' more, that might have better addressed the problem you mention in the beginning.

Yes! "Trade Wars are Class Wars" by Klein & Pettis is the book to read if you want to hear actual economists with actual data talk about this.

> the upside of this system is felt by the entrepreneurs, investors and high-skill employees in tech and finance, while the downside is concentrated with low-skill workers whose jobs are offshored to lower wage countries.

This is true only if we impose barriers to geographic mobility, which we do via artificial scarcity of housing in our major cities.

If we produced housing like we did cars, all the "low-skill" people would be able to move to the city and find a job in the many other services that require human labor.

> the government to lower the cost of high-quality education, build out social systems, and invest into onshoring select strategic industries by raising taxes at the high end.

We don't need more high-quality education nor do we need to onshore. We need to deregulate the housing market, we make it easier to migrate to the US (funny enough, yes that would help with inequality). And I do agree we need better social systems.

There is no way to frame this admin's policies that makes it look reasonable. It's a Crony Clown Club show.

> The obvious solution is not to hurt the economy as a whole, but rather for the government to lower the cost of high-quality education, build out social systems, and invest into onshoring select strategic industries by raising taxes at the high end.

Like... Scandinavia?

> The obvious solution is not to hurt the economy as a whole, but rather for the government to lower the cost of high-quality education, build out social systems, and invest into onshoring select strategic industries by raising taxes at the high end.

You are assuming that this administration has the same goals as you, just different ("foolish") methods of arriving there. I'd posit that they have very different goals that these methods are solving for.

This is a regressive tax that hurts low skill and low wage workers proportionately more since basic necessities of life are going to increase in price - it will be a much larger share of wallet than rich. This will not materially change purchasing behavior of very rich (save maybe waiting to buy a car due to increased pricecs)

It would be beneficial to increase taxes on the massive service economy and use the proceeds to subsidize lower wage industries.

In trumps first term after tariffs affected farmers, they had to subisidize them to keep them afloat. It didn't quite work the way it was intended. The trade war relief program in the first term spent $30bn keeping farmers afloat.

> It's true that free trade is hugely beneficial to the US economy as a whole, particularly with the USD being the reserve currency.

It's true that free trade is hugely beneficial to large cap U.S. companies and their shareholders.

If you are U.S. worker without a lot of equity in the market all you notice is that your job gets outsourced.

As a highly skilled and comparatively highly paid worker, I feel it is outrageous to suggest that I am within the class that needs to give up any reputed "wealth" when I am nowhere near the 1% who hold more than 50% of it. Such a claim just contributes to the wealth making of the 1% misers even more. Class warfare! I have already had to give up significant amounts of college and retirement savings from these tariffs.

Thanks for your comment, it explains why there seems to be a high degree of support for these measures in some quarters (was looking at the youtube comments to the liberation day speech) vs the consensus here at HN.

Let's suppose these policies are to the benefit of some Americans over other the benefit of other Americans. The open question now is: does it matter? does it really have an influence on the gross profit numbers? Will an isolationist foreign policy destroy the international order and how could this effect the US in return?

So basically: the solution is "do more of the same".

I suppose that's the point, people were tired of hearing the same old crap by leftists who fancy themselves as smarter, as their quality of life continued to drop, so they figured "screw it let's try the opposite".

Guess we'll see where it lands.

> The obvious solution is... for the government to lower the cost of high-quality education

Not everyone is smart enough to land in the professional class. The US does its young population an enormous disservice by pushing low academic performers to go to college. There needs to be, somehow, a way for people to make a living with their hands, because for some people, that is genuinely all they are capable of.

> ... build out social systems...

The way you build out the social system is by enabling people in the working class to find genuine work that produces value, not some ditch-digging make-work government program. You don't take those jobs away by offshoring them.

I'm not saying I'm against offshoring in general or that I support Trump's tariffs - I don't. But it's not exactly controversial to point out that, since the end of the Cold War, the US prioritized the recommendations of economists over social cohesion and socially harmonious policy. A lot of people were thrown out of work and were left to fend for themselves. Many of them ended up as victims of the opioid epidemic. I'm not convinced that the prior system was completely peaches as cream.

> The obvious solution is not to hurt the economy as a whole, but rather for the government to lower the cost of high-quality education

I'm always skeptical of the idea that we can just educate ourselves out of problems.

As I see it, that would only raise people's wage expectations which would make us even less competitive on a global market?

The need for blue collar workers doesn't just evaporate, and there's frankly only a finite demand for white collar workers. You give everyone expectations of a white collar job, and they end up working blue collar because there's no job for them, you're just setting society up for mass disappointment and resentment.

You give your average blue collar worker today a degree, are they actually more valuable to their current position? Probably not.

Yes! I've been consistently frustrated at both sides of the issue. It became salient for me when I read about how China had sanctioned three American drone manufacturers that were supplying Ukraine last year, and how it disrupted their supply chains and ultimately the war effort.

It is unacceptable for any other country to be able to do this to any part of the western-aligned military supply chain.

We needed a targeted policy -- I don't care about American cars except to the extent that those factories can be converted to aircraft and tank factories.

But the conversation has been frustratingly reduced to 'reshore low skill work' vs 'save my infinite trough of cheap plastic slop'.

I don't want to hear about tariffs bad, I want to hear about how subsidies are better or about how it doesn't matter anyway because of the structure of the Chinese economy (I saw it claimed without evidence that they depend on imports from places aligned with the west which is reassuring if substantiated).

There's an underlying issue everyone is dancing around.

Your problem statement is missing "national security" angle. As I understand the current administration sees US de-industrialization as a threat to it and tariffs as a soution.

> As such, this administration's policies are foolish, but many on this very site would need to give up a little bit of their privilege to reduce the pain felt by many of their fellow citizens.

Very few people who work as full-time devs are so wealthy that they are totally insulated from general social decline.

You're arguing from a steady state. In point of fact the pain of the at-this-point-seemingly-inevitable recession is absolutely going to be concentrated on the working class. Those of us with savings and work flexibility will do just fine.

Even someone making a first principles argument for a revision of US trade policy should agree that this is insane.

> The obvious solution is not to hurt the economy as a whole, but rather for the government to lower the cost of high-quality education, build out social systems, and invest into onshoring select strategic industries by raising taxes at the high end.

You're proposing to tax an international supply chain. To tax something it has to be in your jurisdiction to begin with, and then you have several problems.

The most obvious of these is, what happens when the stuff just isn't there anymore? Suppose the US isn't competitive with China for manufacturing certain goods, e.g. because the US has a higher cost of living as a result of a purposeful housing shortage and then has higher labor costs, or for any other reason. So manufacturing moves to China, not just to sell to the US but also to sell to the domestic market in China and to Europe and India and the rest of the world. No part of those other transactions is in the US, so the US can't tax them and use the money to help the people in the US who used to be doing that manufacturing and selling those products to the rest of the world. Whereas if you sustain domestic manufacturing through some means then it exists and can make products to sell to the rest of the world because the fixed costs of establishing a manufacturing base can be covered by the domestic market and then it only has to compete in the international market on the basis of variable costs.

Next consider the industries where the US still makes stuff. You could tax those things because they're still in the US. But that makes the US less competitive in the global market for investment capital, which is highly mobile. If higher US taxes cause returns to be lower in the US than they are in other countries then investors go invest in the other countries instead, and then the thing stops being in the US. So that doesn't really work. You can see this in the case of e.g. Europe, which has even worse problems with the loss of manufacturing than the US.

Which leaves the activity where it's the other half of the transaction happening in the US, i.e. China is manufacturing something but the customer is in the US. That you could tax without a huge risk of capital flight, because companies can rarely change the location of their customers, but that still leaves you with two problems.

First, either of the countries participating in the transaction could levy the tax. In the case of China, then they can levy a tax (or some tax-equivalent) to only such an extent that it consumes the surplus in the transaction attributable to the competitive advantage of their country. China can do this because they have a lower cost of living etc., which doesn't work for the US. But because they do that, the US can't tax that portion of the surplus, which was the gain from moving manufacturing to China.

And second, a tax on imports is called a tariff. Which the US can impose to tax that portion of the transaction surplus that isn't attributable to the foreign country's cost advantage, i.e. the preexisting transaction surplus where it costs $8 to make something someone is willing to pay $10 for regardless of where it was made. But tariffs are the thing you don't like.

You can’t make everyone above average.

> for the government to lower the cost of high-quality education

Devils advocate point, and one nobody wants to talk about: what if everyone can't be a high-skill employee?

Imagine if the highest earning jobs required immense physical endurance and strength. Nobody would argue that everyone can do that. It would be obvious that only a subset of people are capable of doing those jobs. For some reason, with intellectual labor, we are able to pretend that there is no threshold and everyone can do it. It's an idea that makes people feel good but what if it's just not true? Can everyone be made above average in something with enough education?

If we're creating an economy where decent jobs only exist for people in the top ~20% of the ability curve, how do we handle that? How do we maintain a democracy? Sometimes people float the idea of UBI, but that could turn out extremely dystopian with a huge underclass of UBI-collecting people in a state of hopelessness and boredom. That doesn't work much better for democracy than a huge underclass of under-employed and unemployed people.

To make matters worse: the fact that our past strategy works so well for increasing GDP means it it tends to inflate assets, including things like housing prices. The end result is a country that looks, to more than half its inhabitants, like a vacation town where outside capital inflates the cost of everything way above what local wages can support. It might not be a coincidence that San Francisco, New York, and other capitals of high margin high skill industries have real estate prices that lock ordinary people out of even "starter homes."

I absolutely do not support Trump's execution here -- it's ham-fisted, reckless, and badly thought out. If we are exiting this neoliberal model, Trump's exit from it is a little bit like Biden's exit from Afghanistan. Still it is obvious to me that the current system is not working for more than half of Americans. It's fantastic for the top ~20% or so and leaves everyone else behind.

We can't keep doing that if we want a democracy. If we exclude 50-80% of the population from anything meaningful or any economic stability, we will get one of two things. Either we'll get the kind of totalitarian state that is required to maintain that kind of inequality in perpetuity, or we will get a string of revolutions or a failed state. People will not just sit around in hopelessness forever. Eventually they will be recruited by demagogues. Ironically Trump has been one of the most effective at this. I'm sure more will eventually show up though. There's a big market for them.

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> lower the cost of high-quality education

And how do you propose we do that? By giving schools even more money at taxpayer's expense?

> raising taxes at the high end

40.1% of US taxpayers on the low end of income distribution pay no income tax, 16.5% pay neither income nor payroll taxes. Top 1% pays 40.4% of all income tax (while holding about 30.8% of net worth, 13.8% of the total is held by top 0.1%). Top 1% (with the possible exception of a few billionaires) already pays through their nose.

this glib analysis neglects the part where decades of plans and budgets have been addressing " build out social systems" while simultaneously building crony networks of political appointees, guarding the hen house. Short term pain is loudly announced for the purpose of defeating the political opponent, not addressing the long standing inefficiencies in a swollen and obese wealth exchange centered in the USA.

tons of cynical one-liners from partisans drown out efforts to really examine the impacts over medium and long term. A horrible problem with this move is that it is not entirely wrong from a fundamentals point of view? It certainly creates winners and losers, no question about it.

Nope. It's true that free trade WAS hugely beneficial to the US economy as a whole. Now free trade is hurting USA economy and that's why USA play against the rules they were promoting for so long.

The deficit is 2 trillion.

Income taxes on individuals are 2.4 trillion.

How much do you expect to raise taxes to cover that gap? You double my taxes and I’m in the welfare line.

Further, and this is not referenced enough - the US must rollover ~9 trillion in treasuries this year. The lower the interest rate to do that, the better. Otherwise it increase the deficit even more.

The only way this ends is one of two paths - a path similar to what we are on; default.

We may not like this one, but default is world destroying because of the broad use of the Dollar around the globe.