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Culture War Roundup for the week of April 28, 2025

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Assuming for a moment that the purpose of tariffs is to shift consumer spending away from foreign imports and towards domesticly manufactured products,

Shouldn't you want retailers to break-out the tariff cost into a seperate legible line item?

A story broke this morning that Amazon was going to start labeling products with the tariff charged on each item to make the price changes legible to the consumer. From the perspective of a protectionist economic policy, this is a good thing. It makes it unignorably clear which items are made in China and which items are made in America. It also shows the direct monetary incentive for you the consumer to but the Made in America item over the Made in China item.

From the perspective of whatever the hell the Trump administration is trying to do, this is a disaster. I understand that governments would prefer the populace not be particularly mindful of how much money they pay in taxes, but it is another thing alltogether to hear this articulated by the press secretary as something that they think makes the administration look good to the public. The official line from the MAGA infuencer types on Twitter is that retailers are doing this as a distraction from the fact that they sell cheap slop from Asian sweatshops, but this is actually highlighting the fact that they sell cheap slop from Asian sweatshops.

Of all sad words of tongue or pen, the saddest are these, Hanania was right again.

It is kind of a funny idea to show tariff costs because you are then revealing to savvy customers what the margins are across different products and brands!

Depends on how they do it. I've read so many tariff stories from industry insiders, and they all go "We used to import this for $80, shipping, handling and fees brings it to $100, and to account for our overhead we sell it for $300 plus tax. But now, we import it for $80, tariffs brings that to $110, shipping and handling brings that to $130, and to maintain our margins, we have to sell it for $390 plus tax."

They ignore that because of tariffs, they now make $260 of profit instead of $200, and half-heatedly claim that this is because of "margin" and because of "overhead". This insistence to preserve the gross margin percentage (instead of preserving the dollar amount margin per product) makes absolutely no sense to me, but they literally all do it. Margin is a percentage, end of story.

So, you probably can't learn much from looking at what Amazon claims are tariff costs.

But even with this I can infer relative gross margins on Nike vs Reebok.

The total preservation of gross margin percentage, I agree, does not make total sense, but neither does only preserving absolute gross margin. At minimum, covering the tariffs requires more working capital, which adds some cost.