In this episode, Scott Becker explores the role of tariffs in balancing trade, protecting American jobs, and encouraging domestic manufacturing.
Chapter 1: What are the good aspects of tariffs?
This is Scott Becker with the Becker Private Equity and Business Podcast. Today's discussion is TIROS, the good and the bad. So here's the issue with TIROS. And we'll talk about the bad second because there's plenty of bad in TIROS. But the good or the purpose in tariffs shouldn't be lost on us. The reason for tariffs is as follows. One, the U.S.
Chapter 2: How does trade imbalance affect our economy?
has a horrendous trade imbalance with the rest of the world where we import a lot more goods than we export. That's good in that we ultimately end up getting goods for cheaper prices overseas. It's like a net whoosh of dollars out of our country to other places.
It's also bad in a lot of places because when we have imports that are much better than exports, much bigger than exports, it often means that we're buying from countries where the minimum wage is a fraction of what our minimum wage is, and we want our workers to make a good wage. Second is we're also buying from countries that don't enforce environmental protections like we do.
Chapter 3: What are the negative impacts of importing goods?
So we're indirectly, by importing a ton of goods, supporting much lower wage labor and also supporting a lot more pollution and less environmental protections than we have. So why don't we talk about those things? Trade imbalance and buying from countries so much where the workers are getting paid very little and where essentially the environment is being beaten up horribly.
That's sort of the purpose of tariffs, if done in a thoughtful, intelligent way, is to try and protect American workers' salaries and wages, even though it has an inflationary impact. and to try to implement other policies that we're working on.
Chapter 4: How do tariffs protect American workers?
Chapter 5: What role do tariffs play in environmental protection?
That's sort of the purpose of tariffs, if done in a thoughtful, intelligent way, is to try and protect American workers' salaries and wages, even though it has an inflationary impact. and to try to implement other policies that we're working on.
For example, if China uses child labor, which I haven't seen recent articles about China using child labor, and we're importing from China at very low cost, that would be a good reason for tariffs to increase the cost of buying goods from China so more goods are bought here. The final thing with tariffs that's on the good side is that when you employ tariffs
Chapter 6: How do tariffs contribute to domestic manufacturing?
You make it more attractive to manufacture here, and then that leads to more better-paying middle-class and lower-skilled jobs than we've had, and that provides a bolster to the middle class. So that's sort of the reason why you like tariffs is our import imbalance is huge. Our deficit's huge.
Chapter 7: What are the overall implications of imposing tariffs?
A lot of places that we're importing from are using wage workers much, much lower than our wages, which means our workers are losing jobs to them overseas. And third, by engaging in tariffs, we end up hopefully helping and spurring on some of the manufacturing here. So that's good. Now, here's the bad.
I'm quite frankly not against reasonable tariffs, particularly when our lunch is getting eaten by overseas countries. What I'm against is what feels like a whipsaw policy or a policy by sort of the seat of the peons.
If we want to work on, and there's multiple reasons that are wrong with this, if we want to work on a coherent trade policy that speaks about tariffs, fine with that, quite frankly, at reasonable levels. The challenge that you have now is, Every day comes a different tariff and a different exception in a different situation. This is a problem because U.S.
manufacturers, if we want to move back manufacturing here, if it's done by the seat of the pants, even if it's done without political consensus, then any investor here or manufacturer here knows that this might not last throughout this administration or throughout the week, because it's very hard to really bring back manufacturing here.
So we have to have some clarity in this trade policy, some ongoing clarity about what is planned, what the intention is, so those here can plan around it. That's absolutely critical. The other thing that's happening with TIRAS – and I saw this today – If you criticize the Democrats for constant special interest politics, you know, I saw a lot the last few days.
I know so many NGOs for political causes that Democrats supported were supported by the federal government. That to me is abusive and horrible. But if I hate it on the Democrat side, I got to hate it just as much on the Republican side when the last person that goes to President Trump's office, in this case yesterday or today, the big three, get some exemptions from tariffs.
If we're going to have a coherent trade policy and a thoughtful trade policy, let's have a coherent trade policy and a thoughtful trade policy that's not so based on special interest and who talked to the White House last. So that's our thoughts on tariffs. So Good, they might serve a real purpose.
Bad, if they're done without part of a coherent trade policy, they're just a ridiculous mess and stupid and ultimately counterproductive. I mean, the other negative on terrorists is if we believe that trade with other countries leads to peace with other countries, sort of ramping up a trade war without a coherent, thoughtful framework is a horrendous thing to do.
Thank you for listening to the Becker Private Equity and Business Podcast. And thank you to our wonderful producer, Chanel Bunger. Thank you very much.
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