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Comment by BFatts | Hacker News Reader

Tariffs don't hurt the producer as much as the consumer. But stupid politicians will tell you otherwise because they think they are smart!

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How do you maintain wage and standard of living differentials with the rest of the world when transportation is as cheap as it currently is without a productivity gap, tariffs, or a carbon tax (increasing transportation cost) to make local manufacturing more attractive?

Besides, there are big strategic reasons to maintain a strong domestic aerospace industry, even if it increases costs in the short run.

Like Adam Smith pointed out, the ideal set-up is to maximize imports and minimize exports. This will make your nation richer over the long run.

If you do that, don’t you have to essentially export money? Which can then be used by your counterparties to buy up your nation’s productive assets, and diminish the effective savings of your populace via asset inflation?

Also, aggregate wealth of a nation isn’t the only thing we should be targeting. You can increase the overall wealth while simultaneously demolishing the wealth of the large portion of your populace involved in domestic manufacturing.

Can you explain this a bit more? If there's a tariff on a component, wouldn't the buyer look for cheaper domestic replacements? So maybe a mix of both -- they pay more in the short term, but it gives domestic suppliers a better chance to win the business over the long term?

It depends on whether there's a local alternative and whether it's desirable.

The key thing is whether the product is fungible.

A Boeing part isn't going to be useful to repair an Airbus owned by a US carrier.

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