How do tariffs work and who really pays for them? Yahoo Finance explains

Yahoo Finance's Brian Cheung explains what tariffs are, how they affect goods coming into the United States and who ends up paying them.
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[@galerivs]

and 10% of import of material does not produce 10% of product final price, because material price of goods is small, probably 20% and 10 % on 20 % of material is 2% increase, so final products price for 10% of increase of raw material will produce 2% increase of final price

[@steevehudon8941]

You could also made your shoes in USA

[@razorintube]

technically, if TARIFFS works for USA at 10%....why not to increase it to 100% then perhaps USA will see better results

[@kathyjones274]

So Trump knew he wouldn't get another term.

[@ern133]

You are being dishonest in your explanation, You should have used an analogy where you make shoes in the US and you compete with shoes made in China.

[@galerivs]

buy material and make shoes in us... and you will be good with tariffs..

[@ryanabernathy4144]

Except the cost to pay US workers is MUCH higher than overseas. Bringing companies back to the US will push corporations to increase prices to cover the increase in cost.

[@galerivs]

@@ryanabernathy4144 productivity per worker is much higher in US than anywhere else. so what if price is increased, at least the amount increased will pay wages to your neighbor

[@ryanabernathy4144]

@@galerivs Historically speaking, consumers want cheap products. If you have two identical phones (one made in China and one in US) with the EXACT same specs, if the China built phone is hundreds cheaper or even $50 cheaper it will sell more. Basic economics shows this to be true. Ideally Americans should stick with American products, but they do not. Look at Walmart. Biggest asset holding corporation in America and most products imported from Taiwan and China. Your theory is nice but ultimately fruitless.

[@galerivs]

@@ryanabernathy4144 tarrifs on ci=hina are not tarrifs on whole world... and there is BIG difference between Taiwan and china... taiwan is separate country, it is actually real china... you can not put them is same basket at all.. and btw, walmart can buy from somewhere else, not from china, and they will... there is a lot of places where walmart and other companies can buy, not only in china....

[@ryanabernathy4144]

@@galerivs Your argument has fallen apart. Let me get you back on track. You originally stated that companies should make products in the US. The products originally moved the US due to profit margins being higher using lower wages for international employees. People stop buying products when the cost is too high. I never said Taiwan and China were the same. I never said that tariffs on China were whole world. You are not even debating logically. My point was that putting tariffs on China (where a majority of our products are made) will increase prices on the consumers. Even with the tariffs it is still cheaper than having US workers make the products so your concept of "buy material and make shoes in us" has been historically proven less feasible. Consumers will typically buy the cheaper good which is usually made in China, Taiwan, Haiti, etc. So back to the ORIGINAL point, your mindset is economically unsound and contradictory to the reality of the situation. Your original argument was never about moving from China to another place outside the US.