Of course he considered making chips and other components in the US, but he was few billions short to start the fab.
Well, there's always the next administration…
(But seriously I do not know how good US Customs is but in my country every day millions of packages from Asia arrive and they are checking not even a percent).
if that happened, the business already had seriously bad margins, bad cash flow, over-leverage, or maybe he was just doing it out of love getting paid maybe back for his time or not.
tariffs might’ve hurt, but they don’t collapse a healthy niche hardware company where buyers are presumably also into the niche.
seems weird i dont get it. can you explain further?
I thought that with time Brazil would modernize and get closer to the US in that regard. It's really sad to see the opposite happening.
What was so special about 1997?
But, tariffs on used cameras or vintage electronics does not help bring manufacturing back. Let's just bring back the de minimis exemption for things like this. More industry targeted tariffs, fewer blanket tariffs.
Targeted tariffs on specific goods leads to the development of local production of that good. Lots and lots of countries have these in place.
Blanket tariffs are, of course, useless. The US doesn't have the climate to grown coffee, so tarifing Brazil serves no purpose other than taxing coffee consumption.
A surgeon uses a scalpel, not an axe. Used well, tariffs are a very powerful tool. Used badly they create more harm, and don't achieve the goal of promoting local production.
Tariffs which are here today, but gone tomorrow, don't created the stable environment which long-term investment in local production requires.
Overall there is a lot of manufacturing in the US. What the US doesn't have are manufacturing jobs because labor is more expensive than automation.
Maybe you meant the US should make sure to have some certain types of manufacturing like chips. In that case, targeted programs are a better approach than any sort of tariffs. See the CHIPS act for example.
The reason services are such a big part of your economy is because you can sit in an air conditioned office, send some emails, push some numbers around on a spreadsheet, and call it work.
maybe even s-100 bus cards.
First, overall, the US has increased manufacturing output over the last couple decades. 2019 was the highest year ever, covid interupted a bit, but levels are back there again.
However the number of people involved has dropped a lot. US manufacturing prefers automation and prefers to manufacture things which are high-volume, low labor.
A good parallel is agriculture. Foods produced in the US (and the US produces a lot of food) tend towards low-labor. Think fields of wheat or corn, not vegetables. Most fresh produce comes from cheap-labor regions like Mexico (or is grown locally with foreign labor.)
So really your point is not about American manufacturing, but rather American labor.
Secondly, this free market you refer to is the American consumer. They are very price sensitive, and deeply favor cheap over good. This contrasts to a lot of the rest of the developed world which strikes more of a balance in this regard.
Since labor is cheaper elsewhere, it follows that cheap imports are favored (by the consumer) over the locally produced items. Unfortunately the imported good is often of a higher quality now (because foreign manufacturers can afford quality and still be cheap.)
So, the politicians you speak of (regardless of party) are reluctant to medel, partly because of unintended consequences, and mostly because the only real lever they have is to increase the cost of imported goods (ie tarrif them) which in turn gets consumers upset. (Witness the fury of the voter in 2020 because of more expensive goods.)
Thus while it's helpful to blame politicians, politicians are elected by consumers. Consumers who could by local, but choose not to. Consumers who vote against politicians that cause price hikes. (Even when those same politicians incentivise local production with things like CHIPS act.)
You can blame politicians, and indeed corporations all day long, but the consumers are voting with their wallets, and "cheap" is the only metric they care about.
Ship something through DHL or a similar service, and they follow the letter of the law so you'll both end up paying the official duty (at least there, it's almost guaranteed to follow the declared value) plus their processing fee, storage fee, and whatever else they include. I've easily paid double the price of a product for all of those fees together.
And worst, it's all unpredictable. At least if there's a 10% sales tax you can calculate that into if you want to buy an item. But once you get hit enough times, you start just not feeling like it's worth the mental load, time, and random financial hit to order stuff.
America had no idea how good they had it, in the before times.
The downside is the insane consumption associated with that. Americans are responsible for an insane amount of pollution, far more per capita than any other people in the history of the world, much of which is tied to how easy/cheap it is to order shit we don't need. So, good if ya wanna buy cheap pollution, pretty bad if ya care about the next generation.
For example, we where ranked 16th in terms of CO2 per capita in 2023. https://en.wikipedia.org/wiki/List_of_countries_by_carbon_di... We are just #3 by population and far richer per capita than the other 2.
So does Canada.
> far more per capita than any other people in the history of the world
Not even remotely close to true. Aside from that it's down 20% from it's peak 40 (!) years ago.
> much of which is tied to how easy/cheap it is to order shit we don't need.
The data does not support this conclusion.
> pretty bad if ya care about the next generation.
Speaking of trends.. care to guess which country has doubled it's pollution in the last 10 years?
The de minimis exception was absolutely insane. It was a full-blown loophole that caused tens of billions of dollars in goods to come through the border almost completely unregulated, ranging from the stuff that should have had tariffs on it, to knockoffs, to drugs and chemicals that shouldn't be in the United States at all.
Even if you are a free trade enthusiast, having 100 million individually wrapped packages not checked by anyone rather than organized container shipping and warehousing is still insane and wasteful and makes a mockery of the concept of even having an international border.
Closing that loophole is literally the only sane path forward. Yes, also, it is a rule that government regulations should be easy to follow and well-administered to avoid the confusing and difficult process of trying to send a package to your friend or order some computer parts.
But, way we had it in the "before times" was absolutely unworkable. It was being exploited to the detriment of American businesses.
The only was you can stop that sort of loophole exploitation is by massive enforcement (i.e. large numbers of random package investigations to establish the actual value of the shipment and comparing it with the declared value).
The cost of such enforcement is very high - possibly not as high as the value of the goods imported by lying about their value, but there's actually no way to know that (since we don't know the actual value of goods that entered under the de minimis exception).
If significant parts (either in numbers or purchasing power) of your population are willing to lie to break the law, you've got problems larger and more widespread than the de minimis exception.
And people in US drive much more. I spend 50€ per month on gasoline for 1.5L SUV for example.
Mine was for a watch I got serviced. My own watch that I shipped out being returned to me… not a new import. If I end up having to pay what FedEx is saying I owe, it would have been cheaper for me to buy a new watch than to get it serviced, which is very upsetting. The whole process has been a horrible experience from the very start and I regret the entire thing. I should have just risked getting it serviced locally… or not done it at all.
[1] https://www.cbp.gov/trade/programs-administration/entry-summ...
Sounds like tariffs working as intended?
There isn't another niche guitar pedal hardware manufacturer that does the same thing as on in Belgium.
I'd rather take a financial hit than act so weak and passive.
I swear between chat control, selling out EU's privacy to US tech companies (you can check how many times Palantir & others met commission members, it's public), the insanity of the ICE ban and this tariffs passivity I'm very unhappy.
Also, it's too convenient to only focus on material goods when the biggest US exports are gazillions in financial and IT services.
Firstly, they're unnecessary. Just do what Canadians are doing. Stop buying US goods. Stop going to the US on holiday. Shop keepers get the hint real quick.
Secondly, they just make goods more expensive for you. They gave no impact on American producers.
So it may feel like the EU is doing nothing. But really, there's nothing they need to do. Tarifs are a tax levied by the US govt on US citizens. Sure demand might drop a bit in the short term, but that just drives producers to find other markets. Which in the long run is a good thing.
If only there was a way to make US goods more expensive to discourage their purchase :P
You have completely missed my point: I don't care about them being helpful or not. It's not about the financial but political aspect.
If your neighbor makes demands and threatens to shoot themselves in the foot if you don't accept, responding by shooting yourself in the face does not seem like a good tactic.
US tariff policy gifts European manufacturers with a competitive advantage.
A small example from a hobby of mine: electronic music, synthesis, audio gadgets, etc. The last decade or two has seen an explosion of innovation in this space driven by small boutique outfits on both sides of the Atlantic. This has only been made possible because of access to Chinese expertise in manufacturing.
The effect of US tariffs is to hurt everyone - but hurt US based companies more. If based in the EU, you pay 0% duty on your low-value-add Chinese inputs and sell finished products to customers - duty free to 450m inhabitants of the EU and with 15% tariff to the US. The same operation based in the US - pays 100% or more on inputs - making it uncompetitive in both markets (for any reasonable range of margin). This is just one small niche/corner of the economy where US-based companies are seeing profits being squeezed.
The other reason to avoid emulating US policy regarding tariffs, is the impact of the flip-flopping and uncertainty on industrial and manufacturing investment. How can anyone intelligently make a long-term (decades) investment decision to build a manufacturing facility in the US when at any moment, your input costs could increase 100%? Or the tariffs you were relying on to allow you to compete with foreign operations could suddenly be lowered as part of a "deal". Or they could go up and down within the space of months or even weeks? Or that in 3 years, the policy will be complete reversed?
Introducing uncertainty and volatility into trade policy might seem like a winning move if you view the world in game theoretic terms - that the global economy is a zero-sum game. I feel that the current US executive sees the world this way - if any other country is doing well, then it must be at the expense of the USA and vice-versa. And this basic misunderstanding of trade and economics is driving these self-harming policies.
As a fellow European, given we have no influence over US policy, I suggest standing back as the US re-learns the painful lesson of history regarding trying to stimulate your economy by making industrial and manufacturing inputs more expensive and adding volatility and uncertainty to the business environment. It sucks for everyone globally because the world isn't zero-sum, the USA suffering doesn't benefit others, so the best policy for Europe is to just refuse to play the game and sit it out.
What's passive about what Europeans are doing?
They marked products as USA-origin and sales of those products are way down (or they just pulled the USA products from the shelf). It's basically an infinite tariff.
"Someone is trying to shoot me so I'll shoot myself in the foot in retaliation"
Sometimes, doing nothing is the best move. Doing something self destructive to make yourself feel better makes no sense at all.
Yet arguably, perhaps the most European move of all
"Shipping carriers or US Customs usually charge $5–$30 in processing fees. Add the item price, import fees, and processing fees to estimate your final cost."
https://pages.ebay.com/tariffs/
Not something I'm doing for a $5 item... I'll sit back and wait until the Supreme Court finds the tariffs are illegal, and the Fed has to pay every cent back to the businesses, suddenly sending the US spiraling into the biggest budget deficit in history.
I verified everything and it wasn't a scam; the government was legitimately about to take me to court or start garnishing my wages or something like that. They said that UPS or FedEx had told them I imported the equipment but never paid import duties.
I got ahold of the case worker for my case and told them it must be some error. After a week or two of back and forth, we finally figured out that it was for a laptop that a user in Canada had shipped back to me when they left the company, and it had been mis-categorized and valued on the import documents. Since we had purchased the laptop in the US in the first place and shipped it to the user, the case was dismissed and I didn't have to pay anything, but it's always a mini heart attack when you get a letter from Uncle Sam saying you owe thousands.
The other option is to prepay tarrifs during the purchase of an item. Fedex and DHL usually offer this service which includes epedited customs clearance.
Is it really? It sounds like you're implying it's some kind of woeful ignorance, but I say it's perfectly reasonable:
1. Each US state is already in a open-borders zero-tariff framework with all other states, which covers a very large portion of what people purchase.
2. Until recently, most individual consumers didn't need to think about tariffs on international goods, since most purchases were <$800 and covered by the de minimis rule. (Which AFAICT was in place for ~80 years.)
I used an online tariff calculator and it said it should be 15%.
Lesson learned: don't trust tariff calcs and assume the worst case. Even if you order something when tariffs have been dropped you're still at risks for broad sweeping tariffs to come into effect by the time your item arrives at a US port.
Moving forward: big companies are far better able to deal with this tin pot dictator chaos, let them handle importation if you can. DigiKey (ugh), Mouser, and Newark all show the tariff as a line item. I'm quite sure at least one of them is fudging COO and all three have some remaining US inventory of some items so there's still some entirely legal tariff avoidance.
Likewise AliExpress choice involves shipping to what I suspect is AliExpress' bonded warehouse and they handle the applicable tariffs. I've recently decided to learn how to solder and there's still plenty of 99 cent crap available from AE if you're willing to (ab)use the new customer discount.
I've had a UPS business account for over 35 years. In the past year or so they've become just terrible. Any call you make to them will have a hold time of at least half an hour. Many of my calls have gone over an hour. Usually you'll get transferred at least once. Also, earlier this year they outsourced their billing services to a third party, requiring additional consent on their website, and billing calls are now answered by an overseas call center.
I had to call them several times a few months back. What triggered everything was a fraudulent shipment made using my UPS account. I thought that I got that straightened out after two calls lasting about 2.5 hours total.
I got another bill the next month for the same fraudulent shipment where even though my shipping costs had been refunded, UPS was charging me a "missing PLD fee" because the criminals who shipped using my account number did not create the shipment using my online account. So after another 1.5 hours or so, that got resolved too. (They don't seem to offer an option to prevent shipments from being initiated from anywhere other than the online account.)
While waiting on hold (both times), their pre-recorded on-hold content would urge me to user their webiste to resolve my issue, which I had already tried, and discovered that it was impossible.
I had to call them one more time the following month because they began charging me $20 per month for no apparent reason. Without first notifying me, they decided that all direct bill accounts would now be charged this monthly fee. I was able to update my account with a credit card on file to get them to stop doing this.
I would switch to FedEx, but their customer service is even worse. I closed my FedEx account 20 years ago, but I continued to receive spam from them for over 15 years with no way to opt out (because of the existing customer relationship that no longer existed).
> What triggered everything was a fraudulent shipment made using my UPS account
If your business allows for it, set your account to "Deny Inbound Charges" at https://www.ups.com/vip/view
UPS is still probably the best domestically for ground shipping, FedEx is the best domestically for express parcels, and DHL is the best for inbound or outbound international without question.
edit: as a biz you (we) should use a legit import broker instead of UPS. But individuals like OP are stuck with no option.
The amended one sounds strange. Why did they claim that the duty for the actual HTS code is $0, and attribute the entirety of the tariff to the special EU-origin code?
https://talkingpointsmemo.com/edblog/lutnick-family-angling-...
¹ annoyingly enough this doesn't even work with DHL, which is a separate thing from DHL Express in Germany.
While they can have an effect of encouraging domestic production, mostly they're a way to extract more money from the population.
You could theoretically get charged over 100% the price of the product if you buy something really cheap and shipping is more expensive than the product because shipping is taxed too.
I ordered a specialty lock and some keys valued at about $400, and paid an extra $400 in duties because of this. It's insane.
Plot twist: I'm in Canada and was ordering a made-in-USA product from a US vendor. The duties were due to matching countertartiffs at the time. Sorry, but that's the last lock I buy from the US (and maybe the last thing with metal in it if I can help it) until this mess is resolved.
You might still get hit with tariffs but you won’t get hit with insane brokerage fees.
When the trade deals and tariff conditions get sufficiently complex(it gets more complex every day as the president accommodates specific companies and personal favors), the bureaucracy also increases so at some point it becomes too much of a nuisance to bother with individual imports.
[0] https://www.theglobalist.com/the-turkification-of-america-tr...
For Turkey it only got worse from there.
they make everything as hard as possible, then create loopholes for their buddies.
this is what they've been claiming has been happening under democrats(projection), but in reality it's teh system they long for. Now that they're in power they can make it happen.
https://budgetlab.yale.edu/research/state-us-tariffs-april-1...
and now trump is easing tariffs on foods because they're too expensive. he's also thinking of shipping out STIMULUS CHECKS because people are struggling to buy tariffed goods.
it's mind boggling what they must be thinking to justify this stuff.
Retroactive taxes are clearly bs.
I've long since opted to pay more to use DHL whenever I can, but a lot of Chinese suppliers simply won't deal with anyone except UPS. Drives me nuts.
Moreover, the money have not been returned yet, that could take a long time and for many people losing access to such an amount would be very inconvenient, even if they knew that the money would be returned, eventually.
The whole thing is unbelievably infuriating and insane and I will warn anyone in the States to never again use UPS for shipping abroad.
https://finance.yahoo.com/news/wall-street-tariff-trades-sho...
Might be hard to issue refunds.
1. https://reason.com/2025/09/02/the-white-house-says-trumps-ta...