DO YOU KNOW?

DID YOU KNOW?

I did some research this morning to educate myself on the tariffs [taxes, import duties] an importer pays to the US government when a shipment arrives of what was ordered.

The tariff [taxes, import duties] I found is 2% to 20% worldwide with China being 20% prior to the announcement of the new tariffs [taxes. Import duties] today.

I singled out mentioning the tariff [taxes, import duties] we are charged when we buy from China because the US government and the Chinese government have agreed that the tariff [taxes, import duties] for the US should be 30% and the Chinese should be 10%.

Keep in mind these percentages are what the US government charges the importer and what the Chinese government charges their companies. I am not concerned with the tariff charge for the Chinese companies because they probably aren’t charged as the US government charges our businesses.

Keep in mind that the agreement between the US government and the Chinese government if you want to call it an agreement is that we will not charge but 30% on the value of what our American based companies buy from Chinese based companies. This is a deal that will last for 90 days. What will happen 90 days from now? Let’s see.

During the next 90 days product purchased from Chinese companies will be marginally more expensive because they will only be 10% higher than before. Remember we have gone from a tariff [tax, import duty] of 20 % to now 30%.

The buying public will be so happy to be able to buy what they want because the shelves will not be empty, and you will be able to buy 30 dolls.

I remember when we had the gas shortage in the 70’s. My father did not care that the price went from 30 cents a gallon to 75 cents a gallon, so long as he could get it.

The same will hold true in the “tariff” discussion. People will ultimately ignore the new prices because they will be marginally higher, they will be happy to be able to buy whatever.

The winner in the “tariff” discussion will be the US government because it will be receiving 30% taxes on all merchandise American companies buy from Chinese companies. That extra 10% tax on top of the old 20% tax is more money than my mind can deal with.    

All the monies collected by the US government have come from US importers not from the Chinese. The benefit to the Chinese is that we the US government will make it easier for the suppliers in China to the American companies because they know what the taxes are 30%. They will work with their customers [American companies] to probably produce a lower quality product than before, this is something I have seen before.

The result is simple; the American consumer spends more and get less. The Chinese factory owner as well as the American buyer calculate their profit before production starts. These two people look at all aspects of what is being made and jointly agree on the components. A match made in heaven. It may look the same as what was previously made but it probably isn’t.

Several years ago, I made a video titled “WIGGY’S QUALITY”. I showed a north face sleeping bag. For 30 years north face used continuous filament fiber [polar guard and Climashield]. To save money they went to another fiberfill calling it continuous filament fiberfill. I bought the bag for $180.00 at rei. It was supposed to be the same as what was made prior. Go to the web site and scroll to wiggy videos and click on this video to see the example of what looks the same but isn’t.  

The way I look at it we have been sold a bill of goods that is costing us more. I wonder what the US government is intending on doing with this windfall of money.

I hope you now understand what a tariff is [by any other name a tax or import duty]. NOW YOU KNOW!!!!