U.S. footwear production dates as far back as 1750, but today 98 percent of shoes are manufactured abroad. Historically, footwear tariffs have been out of step with the United States’ general approach to free trade. High tariffs on products like shoes hit low-income families the hardest – particularly those with children – as these families spend the highest share of their incomes on home goods that tend to be imported.
Manufacturers of labor-intensive products like apparel have already been looking elsewhere in Asia as labor costs continue to rise in China. China has not substantially increased market access for foreign investors in many sectors, causing foreign investment to slow or flatline in recent years. With lingering doubts about the worsening investment climate in China, the trade war is hastening decision-making that had already been underway.
Chinese investments in the United States plunged while U.S. investments in China flatlined. See what’s driving these trends on the US-China FDI Project website.
Well-known razor makers like Boston-based Gillette already face strong headwinds from changing consumer habits: fewer men are shaving as regularly now that beards are more in fashion. Online subscription services like Dollar Shave Club or Harry’s are also putting pressure on prices and profit margins. Now, razor makers are dealing with the problem of tariffs on the specialized steel they import.
The biggest chunk of tariffs in the Great Tariff War of 2018 is between the United States and China, beginning with two rounds of tit-for-tat tariffs worth around $50 billion against one another. The United States just raised on the ante by another $200 billion. China will not fold; they will go “all in” in this poker game, but we don’t know what that means yet as they hold their cards close.
Driving with the Top Down If you’re a movie buff like I am, you’re familiar with recurring scenes in old Hollywood films of a footloose American driving the California coastline in a bright-colored convertible with the top down, hair blowing in the wind. Driving a convertible on the open road is a quintessential American experience. But as China takes center stage in the global auto market, accounting for one quarter of all sales last year, automakers are increasingly focused on meeting Chinese consumer preferences. Between air quality and a penchant for the more practical, a lack of affinity for convertible cars in China might just kill off the future of the beloved ragtop. Air Pollution is Choking Convertible Sales Convertibles […]
Despite the diffusion of drug production globally, a full three-quarters of spending on medicines in the United States is on products that are manufactured domestically, by both American and foreign companies.
The few domestic companies that may (or may not) benefit from special treatment shouldn’t outweigh the costs for the rest of the economy.
The problem steels tariffs are supposed to address isn’t receiving much attention – a number of countries are undeniably engaging in unfair and even predatory trade practices in the steel and aluminum sectors which are damaging to their trade partners.
When it comes to steel tariffs, we could be in a trade war — with ourselves.