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Why tarrifs work: the "chicken tax" and pick up trucks.
| irradiated bonkers resort roommate | 09/26/16 |
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Date: September 26th, 2016 3:09 AM Author: irradiated bonkers resort roommate The US passed the so-called "chicken tax" in 1963.
https://en.m.wikipedia.org/wiki/Chicken_tax
It imposes a 25% tariff on light trucks -- basically anything that is not a passenger vehicle.
As a result, even foreign manufacturers build their trucks in the US (or, now, Mexico because of NAFTA).
By way of example:
Toyota builds the Tacoma in Mexico and San Antonio, the tundra in San Antonio.
https://en.m.wikipedia.org/wiki/Toyota_Motor_Manufacturing_Texas
Nissan builds the frontier, titan and NV passenger van all in Mississippi.
Honda builds the ridgeline in Alabama:
Even Mercedes builds its sprinter vans in South Carolina:
For the domestic manufacturers, other than the Ford Transit Connect which is made in turkey (and imported with windows and a back seat in an attempt to skirt the tax) all light trucks are built in North America.
So GC, explain to me how tariffs don't protect American jobs?
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Date: September 26th, 2016 3:20 AM Author: Jet-lagged sanctuary Of course tariffs will benefit domestic manufacturers and their employees. No one argues otherwise. The argument is that consumers are hurt by paying higher prices, and this welfare loss is larger and more important than the benefits producers gain. (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31491930) |
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Date: November 22nd, 2016 1:49 PM Author: judgmental histrionic brunch corn cake (((guy who "believes" gains in economic efficiency and cost savings are passed on to consumers))) (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31969577) |
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Date: November 22nd, 2016 2:12 PM Author: Lake lay (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31969802) |
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Date: November 22nd, 2016 2:23 PM Author: Grizzly mental disorder (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31969866) |
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Date: November 22nd, 2016 2:24 PM Author: Stirring filthpig parlour (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31969874) |
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Date: November 22nd, 2016 2:29 PM Author: boyish apoplectic office (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31969902) |
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Date: November 22nd, 2016 2:35 PM Author: Galvanic honey-headed stag film killshot (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31969949) |
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Date: November 22nd, 2016 11:55 PM Author: lilac stock car gay wizard (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31974127) |
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Date: November 23rd, 2016 12:10 AM Author: infuriating drab national security agency famous landscape painting (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31974216) |
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Date: November 22nd, 2016 2:20 PM Author: Self-centered Hospital Almost all cars are made in relatively wealthy nations: Japan, Germany, England, United States, Canada, South Korea. Some are built in Mexico, but they aren't really much cheaper. So it's not really a question of making the car more cheaply, but whether Dieter should get the job or Joe.
Cars made in China or India are way cheaper, but they're also SPS quality and can't meet our safety standards. I'm glad we're "missing out" on the "welfare gain" of driving a totally unsafe truck built with low-grade steel from pirated 1970s design plans. |
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Date: November 22nd, 2016 2:36 PM Author: silver tank library Maybe this explains Range Rover reliability. (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31969954) |
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Date: November 22nd, 2016 2:39 PM Author: Self-centered Hospital I don't think RR is built in India, yet. Jag and Volvo quality actually got pretty good under Ford. Not sure how they fucked up Range Rover so badly. (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31969984) |
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Date: November 23rd, 2016 1:23 AM Author: crawly talented home (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31974598) |
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Date: November 23rd, 2016 1:07 AM Author: Nighttime elite heaven Except if we're faced with a choice in how to redistribute - many people would rather pay a higher price as a consumer as a transfer to American labor instead of a transfer from the producer to the unemployed (which won't happen) in the form of welfare.
So think of it as a redistribution from consumers to labor in the form of jobs rather than from taxpayers (consumers) to unemployed labor as welfare payments.... |
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Date: April 3rd, 2025 12:38 PM Author: He flexed his right muscle. US exports high margin services and imports low cost goods. We don’t want to manufacture shit here. Sorry Trumpmos. (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#48811360) |
Date: September 26th, 2016 3:19 AM Author: dashing awkward house you could make it a capital offense to send email. as a result, mail volumes would increase, which would most definitely quantifiable protect USPS/UPS/FEDEX jobs, almost certainly increase them. but there would be obviously be a cost to that, right? even though it would be difficult to quantify or articulate in a quick paragraph.
protecting jobs has a cost, especially in a trade context where there is almost guaranteed to be a retaliatory tariff that ends up gutting some totally unrelated domestic industry. in fact, your example is about that very thing. the object of the policy wasn't to protect truck making jobs. it was to arbitrarily punish foreign auto firms because their governments were trying to protect european poultry farmers.
that sort of shit is a fucking joke, and if you buy into some trumpian dream where we're going to be able to use tariffs to protect whatever we want, and somehow keep all of our export markets intact, you are precisely as dumb as liberals think you are |
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Date: September 26th, 2016 3:29 AM Author: irradiated bonkers resort roommate The primary liberal response is that it is too expensive to manufacture in the United States so it will punish consumers with much higher prices. This argument is not limited to tariffs but all aspects of any non-GC policy -- e.g. deport all the illegals and pay $5 for a tomato. The chicken tax shows this is nonsense. The light truck market is the one shining star of the US automotive industry and any marginal increase in cost is happily absorbed by the US consumer.
On the trade war point, we are already in undeclared trade wars. Every other nation has policies in place which favor their goods over other countries. China's subsidies for its exports and restrictions on foreign investment being the most egregious. But there are many others. More importantly, the US has a huge trade deficit so any net loss in trade benefits the US by reducing that imbalance. Most significantly, the US has by far the most economic leverage of any country in the world. Put simply, the US will win any trade war. |
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Date: November 22nd, 2016 2:14 PM Author: Hairraiser Location Death Wish Are trade deficits necessarily bad? (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31969819) |
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Date: November 22nd, 2016 2:25 PM Author: Stirring filthpig parlour Yes (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31969881) |
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Date: November 22nd, 2016 2:36 PM Author: Galvanic honey-headed stag film yes (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31969950) |
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Date: November 22nd, 2016 10:08 PM Author: cordovan bateful station depressive (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31973272) |
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Date: November 23rd, 2016 12:23 AM Author: charismatic marketing idea well, we didn't have retaliatory tariffs against all countries who had them against us, right? i think japan is an example i was for open trade, but i am not against closing it up some and just seeing what happens. it's not the type of mistake that figures to be devastating or anything like that. it may end up not being a mistake. |
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Date: November 22nd, 2016 1:46 PM Author: irradiated bonkers resort roommate (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31969549) |
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Date: November 22nd, 2016 1:55 PM Author: ruddy house-broken shrine a blog post by Harvard professor Robert Lawrence, who specializes in international trade, proposes that the "chicken tax" is actually what killed Detroit, by insulating it from real competition in light-duty trucks for 40 years.
Profits from hundreds of thousands of Ford F-150 and Chevrolet Silverado pickups, he argues, stayed disproportionately high because any truck built outside North America had a 25-percent tariff slapped onto its price (versus just 2.5 percent on cars).
Addicted to that easy money, Detroit stopped paying attention to passenger cars. Which is easy to believe if you've driven a 2009 Dodge Caliber or 2009 Chevrolet Cobalt, neither of them remotely competitive with the best compacts from Honda or Toyota. |
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Date: November 22nd, 2016 2:20 PM Author: Lake lay there is nothing inherent in the Japanese that makes them make better cars. The Toyota method was in fact invented by an American, Deming iirc. Point is Japa knew they could make a killing selling cars here if they were just a little better and a little cheaper. If there had been a tariff to adjust for the more expensive American labor at the time wrt to Japanese labor, Detroit may have fought back instead of giving up on cars.
Anti-trust laws are there to create competition within the country, tariffs + antitrust actually applied would do a good job of keeping competitiveness in market |
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Date: November 22nd, 2016 2:34 PM Author: Self-centered Hospital They aren't better anymore. Cars are becoming commoditized. Everyone buys from the same big suppliers.
In 1994 a Honda Civic was astonishingly better than a Ford Escort in every aspect: reliability, comfort, ergonomics, performance, handling, panel gaps, material quality, paint, you name it. Now it's mostly a matter of personal preference.
Even a Hyundai, the butt of jokes on late-night talk shows, isn't a total POS anymore. |
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Date: November 22nd, 2016 2:35 PM Author: flushed frum rehab indirect expression "there is nothing inherent in the Japanese that makes them make better cars."
competition makes products better |
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Date: November 22nd, 2016 2:38 PM Author: Self-centered Hospital FWIW: Japanese labor was VERY expensive at the time. Remember, this was during the asset bubble. Their cars were actually much more expensive to export into the US which led to them building factories here. I remember my parents buying one of those Toyota Previa minivans for $35k in 1993 dollars. (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31969973) |
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Date: November 22nd, 2016 2:22 PM Author: Thriller green cruise ship Hondas and Toyotas made in Kentucky (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31969865) |
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Date: November 22nd, 2016 2:30 PM Author: Self-centered Hospital Pickup trucks are top volume sellers for the Big 3 with solid margins. You think Ford, Chevy and Dodge aren't fierce competitors trying to win that market? Japanese brands have been in our market with US factories for decades and their trucks aren't impressive at all. If anything, the US makes have a broader product line, more powertrain choices, and more innovation.
Domestics failed because they never gave a damn about compact FWD cars. They were always shit cars for poors and weirdos to the guys calling the shots. A "real car" was a big V8 cruiser, which the domestic brands were very good at building. They're still great at building them. They're just called pickups and SUVs now. Japanese and European makes had way more experience building compacts that didn't suck and dominated from the 80s-early 2000s.
Now the domestic brands have finally caught up and may even be better than brands like Honda/Toyota that have rested on their reputations. I rented a Fusion recently and it was really nice. Smooth, powerful engine. Solid "European" ride quality. Good ergonomics and quality materials inside. Much nicer than a plastic-fantastic Camry. |
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Date: November 23rd, 2016 1:24 AM Author: crawly talented home (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31974607) |
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Date: November 22nd, 2016 2:35 PM Author: flushed frum rehab indirect expression interesting ty (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31969945) |
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Date: November 22nd, 2016 3:13 PM Author: irradiated bonkers resort roommate Unions and regulations killed Detroit.
The chicken tax saved what is left of the US auto industry. There is no reason we could not have a fuck load of cars built here in right to work states. |
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Date: November 22nd, 2016 11:53 PM Author: Self-centered Hospital (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31974119) |
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Date: November 22nd, 2016 9:37 PM Author: Self-centered Hospital Hmmm libs? (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31973078) |
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Date: November 23rd, 2016 12:08 AM Author: Lascivious cuckold degenerate no, you see we're better off going into debt giving joe shmoe rust belt welfare instead of a job. the entire nation benefits when they can buy throw away plastic bullshit at a marginally lower price (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31974208) |
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Date: November 23rd, 2016 12:14 AM Author: infuriating drab national security agency famous landscape painting (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31974240) |
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Date: November 23rd, 2016 12:16 AM Author: Self-centered Hospital Devastating (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31974258) |
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Date: November 23rd, 2016 1:10 AM Author: Nighttime elite heaven (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31974553) |
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Date: November 23rd, 2016 12:20 AM Author: obsidian headpube mother As an unintended consequence several importers of light trucks have circumvented the tariff via loopholes—including Ford (ostensibly a company that the tax was designed to protect), which imports the Transit Connect light trucks as "passenger vehicles" to the U.S. from Turkey and immediately strips and shreds portions of their interiors, such as installed rear seats, in a warehouse outside Baltimore. (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31974277) |
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Date: November 23rd, 2016 12:21 AM Author: Self-centered Hospital Yep. Or they build the entire thing in Germany and break it back down into a "kit" to be assembled in 5 easy steps here in the US. (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31974285) |
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Date: November 23rd, 2016 1:28 AM Author: irradiated bonkers resort roommate You mean like I mentioned in the original post in this thread? I put seats in the back of my mog so it was a passenger vehicle upon import.
Toyota used to ship pick ups without a bed and had a US made bed installed once at port. Of course, those beds all rusted away .... |
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Date: November 23rd, 2016 3:03 AM Author: Self-centered Hospital Calling bullshit on you owning a Unimog. Pics or STFU. (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#31974896) |
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Date: April 3rd, 2025 11:58 AM (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#48811175) |
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Date: April 3rd, 2025 12:26 PM Author: saibaman Yes, a country can use tariffs to effectively protect a specific domestic industry (like the U.S. does with light trucks, bizarrely). The foreign investment in U.S. factories to produce light trucks can imply a U.S. trade deficit, though, so the jump from "tariffs can protect an industry" to "tariffs can protect all industries and eliminate trade deficits" is a big one. (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#48811288) |
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Date: April 3rd, 2025 12:33 PM Author: Faggottini This gay tariff is why you can't buy a hilux for $10k (http://www.autoadmit.com/thread.php?thread_id=3363945&forum_id=2#48811333) |