The U.S. has over a century’s worth of dominance and control built in, so it’s not gonna unravel anytime soon and countries will need to grovel along for a bit.
But the decoupling has begun, is almost certainly irreversible and is gonna hit Americans hard at most a decade from now.
We have no idea the the chain of motion that has already been set in. Trillions of dollars worth of goodwill and respect has been lost in months.
And that’s also a good illustration of sentiment toward the US today.
I'm an American traveling through Scandinavia and Northern continental Europe for the last three weeks, now in the UK.
I haven't experienced a bit of grief. Their opinion of our politics is generally separate from how they treat me personally, and I do the same for people of other nationalities.
American cultural dominance is everywhere. I can barely find a pub or restaurant not playing American music, for instance.
From my Eastern European perspective, this is something fundamentally different. Sure, many people were critical of Bush Jr., but still, you could, with a bit of effort, construct some semi-reasonable narrative even around Iraq and Afghanistan. But Trump? That feels like an entirely different league.
I grew up in Czechoslovakia, still occupied by Russians at the time. Seeing Trump clap at Putin's landing, seeing US soldiers on their knees rolling red carpet for Putin... this broke something in me. I honestly almost threw up. And that meeting with Zelenskyj in the White House, that will stay with me until I die.
I spent some time in the US when I was at college, and I will always cherish those memories - these were the best seven months of my life. Coincidentally, I was in the US during the Bush Jr. presidency. And despite my dislike for him, I was always defending the US. Somewhat irrationally, I was always trying to justify even the questionable things. But now, that's gone and buried. As far as I am concerned, the US I loved no longer exists. Now it is another Russia-like hostile country that we need to protect ourselves from.
And the personal experience you mention - sure, most people can separate citizens from their state. I can have a civil discussion with a Russian. I was always friendly to my Russian colleagues, immigrants who now live here. But that does not mean I am not hoping with all my heart that their state goes to hell.
I know a ton of Russian emigrees, and basically nobody gives them grief (until some of them start talking politics).
Yes, but the decline is precipitous now. It's gone from "eh, we don't like Americans much, but they're a useful ally" to "wow these guys are fucking insane and we need to divest ASAP".
That is such a sane thing to do. I was always astonished and sad how often strangers in foreign countries instantly link my origin to the actions of the people in power. As if this is completely under my control and with no doubt I support and approve whatever they do.
I've never witnessed this happen. People (in person) are usually not aggressive and would not tell what's on their mind. Maybe if a Ukrainian and a Russian are to meet in a bar, things can get heated.
Mind to share the countries where you saw this happen?
People are nice and will continue to be nice to nice American tourists but make no mistake, there has been a severe shift both in the actions of regular people and business.
Hell, here in the UK I'm happy to hear Sheeran even though he's not really my style typically.
I don't mention that because I like American cultural dominance, merely because it is so ubiquitous.
I was in the middle of South Africa in the oughts and there were bootleg Britney Spears albums... Kind of shocking and I honestly don't exactly understand the appeal of American pop, but it's widespread...
And for nothing. Normally you can at least get a good price for selling your reputation.
My only vantage point is from inside the U.S., but I find the loss of prestige completely believable.
What amazed me was discovering that my own countrymen would vote in, and continue to support, someone like Trump.
My political views are pretty centrist, and I thought I understood the views of most liberals and conservatives.
But I never thought there would be so little resistance to the lies, corruption, authoritarianism, and the breakdown of the separation of powers. And the simple incompetence w.r.t. running the executive branch.
It's like my mental framework has no way to model whatever is going on here.
If you don't like one party what other option do you have but to vote for the other party?
So as a result it's enormously easy for radicals to take over a big tent party and still achieve remarkable support.
It's a cult around Trump and then a (quite diverse) set of politically/culturally/economically-motivated opportunists surrounding him and trying to leverage the Donald's cult-building magic into whatever future United States they dream of.
Whoever speaks to him most recently before he steps in front of a microphone gets policy priority for the next media cycle!
It is historically in line with the U.S.A. The last few decades were the exception.
Certainly, I’m not here to spread conspiracy and I agree with you here, the results are the only evidence we have of the current situation. Given that, I think many of us were amazed.
If you aren't, then what exactly are you saying?
I think that effect comes from astroturfing, algorithms, and tribalism.
The only way imo that a person gets any kind of genuine small sample of the varying vibes outside their circle is to speak with randoms in different geographic regions with a sense of humility, curiosity, and friendliness, in real life.
What you mistook for respect was fear.
In the 80s and 90s USA was idolized and admired. Yes, even in the 80s when officially Poland was still in a soviet influence sphere with soviet and communist propaganda being everywhere.
The word "Ameryka" was a colloquial used to describe something amazing, rich, high tech. The myth of American freedom, that in America hard work can lead to personal eneichment were told like fairy tales.
When Poland joined NATO it was like dream come true. There was this huge enthusiasm of becoming officially friends and allies of USA.
We looked up so much to the USA.
It's really sad to see that completely disappear.
Kind of insane that the American President just made up a lie that tariffs are paid by foreign countries and rest of the administration just went along with it. It flies in the face of any common sense.
Hard to see why companies would pass on a government imposed tax if it is an income tax but not a tariff.
If anything you'd expect it to be the other way around, because an income tax allows deductions for much of the cost of making that income which generally means the amount of tax is lower in times when the business is not making much money, whereas a tariff is on the cost if the businesses imports which can remain high even in times where the business is not making money.
The U.S. has lost so much in terms of even being able to produce anything that it's in a weak position not just in terms of trade, but in domestic security in and of itself. The lesson from COVID should be that ensuring domestic production of at least SOME of everything that CAN be produced domestically in the US should be ensured to exist.
As examples... IMO, all prescription medications/devices should require dual sourcing and at least 50% domestic production. This ensures actual patent licensing as well as being able to ramp up from 50% in case of a need (war/pandemic). It's nearly impossible to ramp up from 0, but easy to ramp up from 50%. This can/should be extended to essential infrastructure, communications and technologies.
Most countries don't have the size/scale/scope to do this... the U.S. and a handful of other countries are and should take advantage of that and ensure it for their own critical security.
I don't say any of this from an isolationist PoV, I think trade is important... I think diplomacy is important... I just feel that a level of domestic security in terms of self-reliance at a certain level is more important.
What is insane, though, is that people voted for him. Elect a clown, expect a circus.
I guess most voting Americans didn't need much to throw the country's century long superpower streak down the toilet. Or worse yet, just pretend that both sides are equally bad and not use their voice that many died to give them.
So, people will just buy more american watches in your example, no?
In the same way that Trump is punishing Americans with the import tariffs, yes. However that is just the primary effect, not the goal.
If you eat less you might go hungry, but that doesn't mean the goal was to go hungry. Rather it was to lose weight, and going hungry is just the direct effect.
Part of the goal of retaliatory tariffs is symbolic, part is to indirectly put pressure on Trump by affecting US export industry.
That is a very simplistic way of looking at it.
Tariffs are taxes on exports and like every tax tool it has its specific purpose.
Lets say US for example has surplus diary. It can export the surplus to other countries. Without tariff the only barrier is the exchange rate. If the diary prices are cheaper than local produce, US diary takes over the market and the US farmers make bank.
Canadian government might want to protect local diary industry. Or Canadians might have concerns about the chemicals in US diary. They have more stringent requirements from their farmers. Either way they raise tariffs for US diary products so that is on par or costlier than local produce.
Tariffs are normally a precision tool. Countries target specific goods and industries.
Now what Trump has done is taken a blunt hammer to it and said all goods from all countries will have tariffs. But if you look at retaliatory tariffs, imposed by other countries, it is precise and meant to hurt very specific industries.
For example, China has raised tariffs on US soyabean. In way it is targeted at US rust belt farmers. The idea being that farmers are a politically active class and if tariffs cause them pain, maybe Trump will come to the table. But that has happened yet. Maybe US farmers just don't care as they are winning too much.
Punishing their own nationals is very explicitly how this is sold to the voter base. "Prices are going to go up for you but unfortunately we have to do this to try to stop our neighbor from raising their import tax explicitly on goods from us".
Taxes are not a problem if everyone plays by the same rules. The problem for the economy is that some imports are subject to tax and others aren't, or when domestic goods aren't subject to the same tax. Picking winners and losers in an economy by political has never before in history turned out a winning concept.
Only silence or absolute truth should be accepted.
Sounds like a foolproof plan.
Did we not read 1984?
Microeconomics 101: https://www.khanacademy.org/economics-finance-domain/microec...
The consumer paying the tariff is merely an optimization over the exporter paying the tariff such that the tariff money passes through one less hand. Practically they seem pretty similar.
Before a tariff is imposed, the seller sells the good for $10 and keeps $10 in revenue.
If a tariff of $1 is imposed under these hypothetical circumstances, does the buyer pay more? Does the exporter get paid the same as before?
Clearly, it's neither guaranteed that the buyer will "pay more" nor that the export will "get paid the same as before". In reality because demand is neither 100% elastic nor 100% inelastic, what tends to happen is that the cost of the tariff is split in some ratio between the buyer and seller.
I find it mildly amusing that there are so many people claiming that it's 100% on one side or other, when it's trivially easy to see why that can't be GUARANTEED TO BE the case.
If the demand curve is very price sensitive - like people might stop buying wool blankets if the price went up 50%, and buy cotton blankets instead - then the tariff will be paid by the suppliers, because they must lower their prices to make the final price the same.
And similarly, if the buyers are inelastic, they will pay the tariff. Like for baby formula, maybe parents are willing to stomach significant price hikes without changing how much they buy.
Exporter pays: Consumer ends up paying price + tariff, then seller pays the tariff to the shipping company, which pays it to the government.
Importer pays: Consumer pays price, then later pays the tariff to the shipping company, which pays it to the government.
In both cases the consumer is paying price + tariff. A small difference is that some consumers could be psychologically tricked by the lower price tag in the importer pays model. Note that what I'm saying doesn't concern itself with changes in pricing due to this.
Promote the consumption products provided by a different vendor. Namely ones that tariffs don’t apply to.
It’s not a hard concept to understand, and talking about who pays is a distraction. Namely because it will be case by case involving 3 or more parties who won’t all chose the same choices they have every time.
Tariffs are a tax, paid on the value of imported good, by US citizens who are buying things from outside of the USA. That's it. They are not paid by anyone outside of the US.
Now tariffs are imposed, my import cost per widget is $139. Not only do I have to jack up my US price to $189, I have to jack up my UK price to £142, meaning UK customers are also paying the tariff now.
Even if you’re a bit smarter about your logistics and use an FTZ or drawback against the import duties, imagine you sell two widgets, one where you don’t pay import duties (bound for the UK) and one where you do (remaining in the US). Your total cost to import is $239.
Instead of making your US customers eat all the cost of the tariff, you might instead adjust your retail prices to $170 and £128 respectively. Again, now your British customers are paying an increased price due to the tariffs.
Edit: for that matter, if you could raise your prices without losing any customers, why did you wait for the tarrifs? You should have already done it.
Thus, the change may simply be that profit margin for sales into the US drops (or rather than it skews that way).
But there are still many commodities where you're not pricing the product based on branding.
These commodities will likely still have the same price on the international market. And thus, consumers in the US will see the effects of tariffs in the price.
Such commodities could be finished goods, but also parts, machines or feedstock for industry in the US.
I'd also guess that if you look at what middle class people buy, these commodities make up a larger percentage of the expenditure -- than it does for wealthy people. Making tariffs a very regressive tax.
Most people won't care about the price of luxury watch. But most people will buy aluminum cans, etc.
Of course not. They charge the highest price they possibly can in each market, regardless of other factors. They're not compensating this here or that there. Every company always charge as much as they can get away with, that is the core function of business.
Did they lower the US import price before the tariff is applied in the US?
Sony and Microsoft did price hikes outside of the US at first as an example of how other countries may be paying for US tarriffs indirectly. But as of a month ago these had to relent and eventually they did both do price hikes on their systems.
Operating costs for coffee shops mainly come from other things than the beans, such as rent, utilities, wages.
But no, it hurt import businesses in unforseen ways. I saw entire shipment crates get discarded because it was suddenly too expensive to get into the country overnight and too expensive to ship back. Just senseless, pointless waste.
Here’s a link to the Swiss store which has more details, like price: https://www.swatch.com/en-ch/what-if-tariffs-so34z106/SO34Z1...
Tariffs never make domestic goods cheaper. In fact if the supply chain has anything imported then domestic goods become more expensive.
The best argument is that it makes domestic good relatively cheaper, thus supporting US manufacturing and so keeping jobs and profit in the country.
However... that would require domestic goods to be an actual option. I don't see many US manufactured watches available, and the ones that are still don't really compete.
When one turned away, the message would instantly become different, like changing "Down with the heat" to "Down with the cops" - https://sztukapubliczna.pl/pl/precz-z-u-palami-pomaranczowa-...
https://en.wikipedia.org/wiki/Orange_Alternative
the whole world is a work of art, so even a single policeman standing in the street is a work of art
Greatest feature, you can glance at it sideways! And the built-in reminders of 39%.
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Some watches still use Roman numerals (XII, III, VI, IX), Swatch specify here that those are Arabic (12, 3, 6, 9).
Ok, I can give you a Skin Irony, but then you would be paying +200 for a Quartz, why not buy an Orient Bambino or a Hamilton Khaki? much better bang for the buck.
Not to mention the clicking noise of a Swatch quartz. In silence, it drives me nuts.
The most understated watch they make is the Swatch Pay!. Super useful, never fails.
I’ll stick with my Patek Philippe Nautilus 5811 [1], thanks ;)
Also Swiss btw.
[1] https://www.patek.com/en/collection/nautilus/5811-1g-001
I lean to the minimal style, so I recently got one from Obaku. The one I got is technically in their women's line; women's watches tend to be simpler, and I have small wrists so women's watches tend to fit me better. Skagen also makes nice minimal stuff.
I also sometimes dig around used watch forums like WatchUSeek. You can find dozens of cool watches from the 60s-80s, many mechanical, for like $50-200.
