if it would give domestic manufacturers such great pricing power, then wouldn’t it also encourage foreign manufacturers to manufacture in the US to take advantage of that pricing power? Wouldn’t that be a good thing for the US? and as more manufacturers move to the US, wouldn’t that competition then tend to lower prices?
rcxdude|7 months ago
Moving manufacturing into the US takes a lot of up-front investment and would take a long time to pay off. It could happen if the manufacturers believe that the pricing pressure is going to remain present for the time that it takes to pay off. This is what's meant by 'business wants to see stability'. The current administration has shown the opposite of that, with a chaotic series of rules which don't appear to be well thought through, or likely to stick, so it's mostly achieving the worst of both worlds.
(A similar thing is true of defense spending: if the government is commissioning some manufacturing for which it is the only buyer, and it has demonstrated that the amount that it actually buys is liable to fluctuate wildly in the name of 'cost savings', then the price it pays per unit is going to reflect the risk that the business which is setting up that manufacturing doesn't actually sell as many as promised)