Re:China’s Economy to Reap Benefits That Once Flowed to U.S
by ineedasername on Monday December 24, 2018 @01:52PM
(#18753613)
To answer your question, at least in part: Tariffs are negative sum, draining money out of the active economy and into less productive government pockets. From a game theoretic point of view they represent a "defection", where the initial defector promotes self interested short term gain but after multiple iterations promoting tit fir tat reprisals more and more is taken out of the active economy.
It's no coincidence that long term economic growth these past two centuries has occurred as countries gradually, slowly used tarrifs less and less. (yes, of course there was more to it than just that)
Tarrifs hurt all classes except the very wealthy who can purchase goods regardless of cost. For everyone else they raise the cost of living, reduce purchasing power, and thereby reduce the velocity of capital throughout the whole system.
It's no coincidence that long term economic growth these past two centuries has occurred as countries gradually, slowly used tarrifs less and less. (yes, of course there was more to it than just that)
Tarrifs hurt all classes except the very wealthy who can purchase goods regardless of cost. For everyone else they raise the cost of living, reduce purchasing power, and thereby reduce the velocity of capital throughout the whole system.