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PaperclipPerfector  28d ago (text post)   32439 thread views

Culture War Roundup for the week of April 7, 2025

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Trump exempts smartphones and computers from new tariffs

US President Donald Trump's administration has exempted smartphones and computers from reciprocal tariffs, including the 125% levies imposed on Chinese imports. The move comes after concerns from US tech companies that the price of gadgets could skyrocket, as many of them are made in China. The exemptions also include other electronic devices and components, including semiconductors, solar cells and memory cards.

Some estimates suggested iPhone prices and other electronic goods in the US would have gone up three times if the costs of the tariffs had been passed on to consumers. Trump's move takes off "a huge black cloud overhang for now over the tech sector and the pressure facing U.S. Big Tech", said Wedbush analyst Dan Ives in a research note, according to the Associated Press.

The US is a major market for iPhones, while Apple accounted for more than half of its smartphones sales last year, according to Counterpoint Research. It says as much as 80% of Apple's iPhones intended for US sale are made in China, with the remaining 20% made in India. Along with fellow smartphone giants such as Samsung, Apple has been trying to diversify its supply chains to avoid over-reliance on China in recent years. India and Vietnam emerged as frontrunners for additional manufacturing hubs. As tariffs took effect, Apple reportedly looked to speed up and increase its production of India-produced devices in recent days.

Lot of sound and fury, but it seems at the end of the day nothing will happen. Over/under on how many more 'exemptions' we'll end up with?

What an awful sign for our civilization --- Trump's reversal reflects our lack to accept short term pain to achieve long term objectives. For my purposes here, it doesn't matter whether the tariffs on phones would have actually helped: what matters is that Trump believed they would, that he was the duly elected head of state, that imposing tariffs was within his legitimate authority, and that he had a majority in the legislature as well.

He still couldn't do it. If he couldn't, nobody can. And if our societal time preference really is this high, we are fucked.

What makes you think Trump thinks the tariffs on phones would have helped? Just by imposing and exempting he promotes the desired diversification from China without having the country take the short-term pain. Win-win.

It doesn't matter whether they would have helped at the object level. What matters is Trump believed they would and had the mandate of the people to exercise his judgement in making policy. We just can't get stuff done. Yes, I'd have been hungry without breakfast yesterday although I had it.

I don't follow this line of thinking – are you implying that Trump wanted to continue the tariffs on phones regardless of the impact but was prevented from doing so?

I believe Trump believed and still believes that tariffs are effective for causing import substitution and bootstrapping new domestic industry. He also wanted and probably still wants the US to be able to make phones. There are good reasons for a country to be self sufficient in strategic technologies.

Trump was forced to undo this policy, either through political pressure or his own assessment of the impact of the policy on his political capital. I don't think his mind was changed about the merits of the policy. I do think this reversal is evidence that the US is incapable of doing hard things.

Things are different, though, when everyone who knows anything about the thing you're trying to do knows it's a bad idea and explains to you why it's a bad idea. It's not like Trump had a bevy of economists in his ear and out in the media saying that the tariff policy was necessary and that the short-term pain would be worth it. The only people saying that were him and politicians whose constituents require supplication to him. The criticism he was receiving probably wasn't simply that this was a bad move politically, but a stupid move economically that wouldn't bring about the desired result even if we'd stuck to it for a hundred years. It may be an act of courage to do something necessary but politically unpopular, but it's pure stupidity to do something disastrous and politically unpopular.

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