Over the years, many American manufacturers have moved their operations to other countries to increase their profits. Two things made it necessary for them to do this. The American people began buying foreign merchandise, because it was slightly less expensive than our own goods, and our government not only allowed this to happen but caused it to happen with various trade agreements.
Our people and our government were warned, particularly by union leadership, of the long-term consequences of such folly but would not accept these warnings. I remember the arguments as far back as the mid-1950s.
President Trump has instituted tariffs, particularly against China, to get American companies to move their operations out of China and back to the United States. The media is now harping on the fact that the new round of tariffs will cause consumer prices to increase. Prices will increase, at least in the short term, until manufacturing is brought back to America and we develop our own competition again.
Companies will not return their operations to the United States on their own, because they can make larger profits by manufacturing in foreign countries because of lower labor and material costs. They do not care that the Chinese are forcing them to divulge trade secrets to help China become the factory of the world; they only care about their short-term profits. They do not care about the effect on our country.
Now, people are demanding a minimum wage of $15 dollars per hour. I wonder why people will accept the higher prices brought on by higher wages but don't want the higher prices brought about by the tariffs that will, hopefully, bring manufacturing and money back to the United States and provide the jobs that are worth higher wages. Higher wages for the same output bring about higher prices; and that combination is called inflation.
In the 19th century, when manufacturing in the United States was just getting started, our government instituted tariffs on foreign goods so that our companies could compete with Europe. These tariffs did indeed cause higher consumer prices initially. but they also resulted in creating the greatest economy on earth.
In the past 70 years, our manufacturing has regressed to where it was 150 years ago; and, once again, it is going to take some pain to regain our past status. But this is nowhere near the pain that our progeny will be subjected to if we do not correct the situation.
LAWRENCE D. WEBER