It’s actually quite shocking to leave the U.S. and experience the drastic fall in respect.
The U.S. has over a century’s worth of dominance and control built in, so it’s not gonna unravel anytime soon and countries will need to grovel along for a bit.
But the decoupling has begun, is almost certainly irreversible and is gonna hit Americans hard at most a decade from now.
We have no idea the the chain of motion that has already been set in. Trillions of dollars worth of goodwill and respect has been lost in months.
From my Western European perspective: what's specifically striking is how sentiment towards China has improved in turn. Not sure what caused it exactly, but my guess is 1) the U.S. as common rival, and 2) the amalgamation of fears of Chinese manufacturing with newfound fears of U.S. big tech into European nationalism to replace some vague sense of "Western" alliance. The latter may be turning China from the big geopolitical rival to be wary of to just another outside force.
I'm not sure it's all that new. During the Bush Jr. years America was not highly thought of.
I'm an American traveling through Scandinavia and Northern continental Europe for the last three weeks, now in the UK.
I haven't experienced a bit of grief. Their opinion of our politics is generally separate from how they treat me personally, and I do the same for people of other nationalities.
American cultural dominance is everywhere. I can barely find a pub or restaurant not playing American music, for instance.
> I'm not sure it's all that new. During the Bush Jr. years America was not highly thought of.
From my Eastern European perspective, this is something fundamentally different. Sure, many people were critical of Bush Jr., but still, you could, with a bit of effort, construct some semi-reasonable narrative even around Iraq and Afghanistan. But Trump? That feels like an entirely different league.
I grew up in Czechoslovakia, still occupied by Russians at the time. Seeing Trump clap at Putin's landing, seeing US soldiers on their knees rolling red carpet for Putin... this broke something in me. I honestly almost threw up. And that meeting with Zelenskyj in the White House, that will stay with me until I die.
I spent some time in the US when I was at college, and I will always cherish those memories - these were the best seven months of my life. Coincidentally, I was in the US during the Bush Jr. presidency. And despite my dislike for him, I was always defending the US. Somewhat irrationally, I was always trying to justify even the questionable things. But now, that's gone and buried. As far as I am concerned, the US I loved no longer exists. Now it is another Russia-like hostile country that we need to protect ourselves from.
And the personal experience you mention - sure, most people can separate citizens from their state. I can have a civil discussion with a Russian. I was always friendly to my Russian colleagues, immigrants who now live here. But that does not mean I am not hoping with all my heart that their state goes to hell.
Considering how many places are actively going to sh*t in the world right now, I'm not surprised that people have grown weary of keeping track of which are the 'bad' countries we're supposed to dislike, at the same time, thanks to globalized work and social media, people have realized that people are people everywhere, and governments are varying degrees of shitty in every country, with people even in the supposedly more democratic ones feeling powerless in affecting how they are governed.
I know a ton of Russian emigrees, and basically nobody gives them grief (until some of them start talking politics).
> I'm not sure it's all that new. During the Bush Jr. years America was not highly thought of.
Yes, but the decline is precipitous now. It's gone from "eh, we don't like Americans much, but they're a useful ally" to "wow these guys are fucking insane and we need to divest ASAP".
> Their opinion of our politics is generally separate from how they treat me personally, and I do the same for people of other nationalities.
That is such a sane thing to do. I was always astonished and sad how often strangers in foreign countries instantly link my origin to the actions of the people in power. As if this is completely under my control and with no doubt I support and approve whatever they do.
There's no comparison to the W Bush years. He was a buffoon that was mocked, but few if any seriously did things like boycott travel to the USA. Now boycotting travel to the USA is commonplace and travel to the USA has plunged.
People are nice and will continue to be nice to nice American tourists but make no mistake, there has been a severe shift both in the actions of regular people and business.
If anything, it would be nice if a few places were left that didn't have American cultural artifacts everywhere. My experience in the Middle East was often wondering if I were actually in either an American colony or else some place that had dedicated itself to being a kind of museum of American culture, movies, models, advertising, and so forth.
> It’s actually quite shocking to leave the U.S. and experience the drastic fall in respect.
My only vantage point is from inside the U.S., but I find the loss of prestige completely believable.
What amazed me was discovering that my own countrymen would vote in, and continue to support, someone like Trump.
My political views are pretty centrist, and I thought I understood the views of most liberals and conservatives.
But I never thought there would be so little resistance to the lies, corruption, authoritarianism, and the breakdown of the separation of powers. And the simple incompetence w.r.t. running the executive branch.
It's like my mental framework has no way to model whatever is going on here.
Try on the "it's a cult" model. It explains pretty much everything. This has almost nothing to do with politics or policy or even economics.
It's a cult around Trump and then a (quite diverse) set of politically/culturally/economically-motivated opportunists surrounding him and trying to leverage the Donald's cult-building magic into whatever future United States they dream of.
Whoever speaks to him most recently before he steps in front of a microphone gets policy priority for the next media cycle!
Well, we could be amazed although you seem to be jumping past another, more controversial yet still equally possible conclusion which is that our elections aren’t as pure as we’d all like to believe.
Certainly, I’m not here to spread conspiracy and I agree with you here, the results are the only evidence we have of the current situation. Given that, I think many of us were amazed.
> My political views are pretty centrist, and I thought I understood the views of most liberals and conservatives.
I think that effect comes from astroturfing, algorithms, and tribalism.
The only way imo that a person gets any kind of genuine small sample of the varying vibes outside their circle is to speak with randoms in different geographic regions with a sense of humility, curiosity, and friendliness, in real life.
In the 80s and 90s USA was idolized and admired. Yes, even in the 80s when officially Poland was still in a soviet influence sphere with soviet and communist propaganda being everywhere.
The word "Ameryka" was a colloquial used to describe something amazing, rich, high tech. The myth of American freedom, that in America hard work can lead to personal eneichment were told like fairy tales.
When Poland joined NATO it was like dream come true. There was this huge enthusiasm of becoming officially friends and allies of USA.
The number 39 refers to the 39% tariff rate on Switzerland.
Kind of insane that the American President just made up a lie that tariffs are paid by foreign countries and rest of the administration just went along with it. It flies in the face of any common sense.
It's even worse than that. Their argument against corporate income taxes is that any tax imposed on a corporation is just passed on to consumers.
Hard to see why companies would pass on a government imposed tax if it is an income tax but not a tariff.
If anything you'd expect it to be the other way around, because an income tax allows deductions for much of the cost of making that income which generally means the amount of tax is lower in times when the business is not making much money, whereas a tariff is on the cost if the businesses imports which can remain high even in times where the business is not making money.
Both are passed to consumers... the difference is a tariff is a point for international negotiation, there are competing options to a tariffed product, and it's a relativistic approach.
The U.S. has lost so much in terms of even being able to produce anything that it's in a weak position not just in terms of trade, but in domestic security in and of itself. The lesson from COVID should be that ensuring domestic production of at least SOME of everything that CAN be produced domestically in the US should be ensured to exist.
As examples... IMO, all prescription medications/devices should require dual sourcing and at least 50% domestic production. This ensures actual patent licensing as well as being able to ramp up from 50% in case of a need (war/pandemic). It's nearly impossible to ramp up from 0, but easy to ramp up from 50%. This can/should be extended to essential infrastructure, communications and technologies.
Most countries don't have the size/scale/scope to do this... the U.S. and a handful of other countries are and should take advantage of that and ensure it for their own critical security.
I don't say any of this from an isolationist PoV, I think trade is important... I think diplomacy is important... I just feel that a level of domestic security in terms of self-reliance at a certain level is more important.
I guess most voting Americans didn't need much to throw the country's century long superpower streak down the toilet. Or worse yet, just pretend that both sides are equally bad and not use their voice that many died to give them.
So why would the Swiss company care then? Care so much to make a special watch? It’s no skin off their back, they don’t pay the tariff right? Americans are the only ones affected right?
It obviously affects Swiss companies too, because their products become more expensive to American consumers, which makes it more unlikely they will buy them. No one said Americans are the only ones affected. But it’s Americans that pay the tariffs.
I don't know how this tariff stuff works, so for my own understanding, how come countries retaliate to US tariffs by imposing retaliatory tariffs? Are they punishing their own nationals?
In a sense you can think of it that way, as a Canadian we counter-tariff the US and that can be considered punishing us; however the US is only one country and it encouraged more free trade with every other one of our trading partners so in a game theory sense it's affecting Canadian trade negatively with one country and affecting US trade negatively with you know.. every country.
In the same way that Trump is punishing Americans with the import tariffs, yes. However that is just the primary effect, not the goal.
If you eat less you might go hungry, but that doesn't mean the goal was to go hungry. Rather it was to lose weight, and going hungry is just the direct effect.
Part of the goal of retaliatory tariffs is symbolic, part is to indirectly put pressure on Trump by affecting US export industry.
Tariffs are taxes on exports and like every tax tool it has its specific purpose.
Lets say US for example has surplus diary. It can export the surplus to other countries. Without tariff the only barrier is the exchange rate. If the diary prices are cheaper than local produce, US diary takes over the market and the US farmers make bank.
Canadian government might want to protect local diary industry. Or Canadians might have concerns about the chemicals in US diary. They have more stringent requirements from their farmers. Either way they raise tariffs for US diary products so that is on par or costlier than local produce.
Tariffs are normally a precision tool. Countries target specific goods and industries.
Now what Trump has done is taken a blunt hammer to it and said all goods from all countries will have tariffs. But if you look at retaliatory tariffs, imposed by other countries, it is precise and meant to hurt very specific industries.
For example, China has raised tariffs on US soyabean. In way it is targeted at US rust belt farmers. The idea being that farmers are a politically active class and if tariffs cause them pain, maybe Trump will come to the table. But that has happened yet. Maybe US farmers just don't care as they are winning too much.
An import tax works just like any other tax. You decide a law that "import of fresh fruit from Mexico is as of (date) subject to a 10% tax" together with details about exactly what fruit is considered fresh, how to calculate the tax, and where to pay.
Punishing their own nationals is very explicitly how this is sold to the voter base. "Prices are going to go up for you but unfortunately we have to do this to try to stop our neighbor from raising their import tax explicitly on goods from us".
Taxes are not a problem if everyone plays by the same rules. The problem for the economy is that some imports are subject to tax and others aren't, or when domestic goods aren't subject to the same tax. Picking winners and losers in an economy by political has never before in history turned out a winning concept.
I wish there was simple three strike policy on any elected official. Three proven lies and they are remove from office for life. And these can be anything. And not knowing at time does not change it.
Only silence or absolute truth should be accepted.
The consumer paying the tariff is merely an optimization over the exporter paying the tariff such that the tariff money passes through one less hand. Practically they seem pretty similar.
This would be more impactful if we could see the cost to US purchasers was actually 39% more. Sadly some manufacturers spread the cost across all consumers, which actually means non-US customers are actually paying some of the tariff costs too.
I imagine some manufacturers used tariffs as a reason to lower the price of their products that imported into the US while also raising the price outside of the US to balance that change, but that doesn't mean the manufacturer or their customers outside of the USA are paying anything towards tariffs. The entire tariff transaction is between the customer and the US government, and it's all transacted within the USA.
Tariffs are a tax, paid on the value of imported good, by US citizens who are buying things from outside of the USA. That's it. They are not paid by anyone outside of the US.
Let’s say I’m a widget seller in the US, and my widgets cost $100 to import from Switzerland before tariffs. I retail them at $150 USD in the US, but I sell internationally. In the UK for example, I retail them at £113 (simple conversion, obviously it doesn’t really work like this).
Now tariffs are imposed, my import cost per widget is $139. Not only do I have to jack up my US price to $189, I have to jack up my UK price to £142, meaning UK customers are also paying the tariff now.
Even if you’re a bit smarter about your logistics and use an FTZ or drawback against the import duties, imagine you sell two widgets, one where you don’t pay import duties (bound for the UK) and one where you do (remaining in the US). Your total cost to import is $239.
Instead of making your US customers eat all the cost of the tariff, you might instead adjust your retail prices to $170 and £128 respectively. Again, now your British customers are paying an increased price due to the tariffs.
The manufacturer are subsidising the tariffs if they lower their price in the us to counteract part of the tariff. When they charge other markets more to make up for the cost, they are making those markets pay for the subsidy.
Seems to have been the case with PS5 and Xbox consoles. The rest of the world was effectively subsidizing US gamers for a while, until prices there were jacked up even higher.
Aren't most subscriptions significantly cheaper outside the US? I don't know specifically about those, but YouTube's premium is pennies on the dollar in places like Ukraine, Turkey, etc.
The tariff is applied to the import value. For many products you'll get a significant markup on top within the US for distribution, which is not affected by the tariffs.
> Sadly some manufacturers spread the cost across all consumers
Of course not. They charge the highest price they possibly can in each market, regardless of other factors. They're not compensating this here or that there. Every company always charge as much as they can get away with, that is the core function of business.
This was a big worry initially when the tariffs were announced but it doesn’t actually seem to be happening. Most manufacturers are not adjusting their price structure because the effects are super hard to estimate (don’t forget that the US is still just 20% of worldwide demand)
The gaming market is a good example of how they tried to mitigate this. Firstly, Nintendo tried to not surge the price of the Switch 2 by instead increasing the prices of accessories. Then they raised Switch 1 prices. It might still end up needing to raise the Switch 2 price if this keeps up.
Sony and Microsoft did price hikes outside of the US at first as an example of how other countries may be paying for US tarriffs indirectly. But as of a month ago these had to relent and eventually they did both do price hikes on their systems.
This might have been true three months ago, but it isn't any more. Narrow margin business like independently owned coffee shops are already seeing consumables increase in price by up to 3x, which then leads them to have to add "tariff surcharges" that show up on their POS devices.
Tangential. It is fun to note how in ads showing watches the time is usually 9 past 10 as shown in the image. This apparently gives the most pleasing balance of the watch dials for the eye, while not covering the time indicators below.
At first I thought tariffs were just more inflation. Import prices increase, sales prices balance it out and people will buy anyway.
But no, it hurt import businesses in unforseen ways. I saw entire shipment crates get discarded because it was suddenly too expensive to get into the country overnight and too expensive to ship back. Just senseless, pointless waste.
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The U.S. has over a century’s worth of dominance and control built in, so it’s not gonna unravel anytime soon and countries will need to grovel along for a bit.
But the decoupling has begun, is almost certainly irreversible and is gonna hit Americans hard at most a decade from now.
We have no idea the the chain of motion that has already been set in. Trillions of dollars worth of goodwill and respect has been lost in months.
I'm an American traveling through Scandinavia and Northern continental Europe for the last three weeks, now in the UK.
I haven't experienced a bit of grief. Their opinion of our politics is generally separate from how they treat me personally, and I do the same for people of other nationalities.
American cultural dominance is everywhere. I can barely find a pub or restaurant not playing American music, for instance.
From my Eastern European perspective, this is something fundamentally different. Sure, many people were critical of Bush Jr., but still, you could, with a bit of effort, construct some semi-reasonable narrative even around Iraq and Afghanistan. But Trump? That feels like an entirely different league.
I grew up in Czechoslovakia, still occupied by Russians at the time. Seeing Trump clap at Putin's landing, seeing US soldiers on their knees rolling red carpet for Putin... this broke something in me. I honestly almost threw up. And that meeting with Zelenskyj in the White House, that will stay with me until I die.
I spent some time in the US when I was at college, and I will always cherish those memories - these were the best seven months of my life. Coincidentally, I was in the US during the Bush Jr. presidency. And despite my dislike for him, I was always defending the US. Somewhat irrationally, I was always trying to justify even the questionable things. But now, that's gone and buried. As far as I am concerned, the US I loved no longer exists. Now it is another Russia-like hostile country that we need to protect ourselves from.
And the personal experience you mention - sure, most people can separate citizens from their state. I can have a civil discussion with a Russian. I was always friendly to my Russian colleagues, immigrants who now live here. But that does not mean I am not hoping with all my heart that their state goes to hell.
I know a ton of Russian emigrees, and basically nobody gives them grief (until some of them start talking politics).
Yes, but the decline is precipitous now. It's gone from "eh, we don't like Americans much, but they're a useful ally" to "wow these guys are fucking insane and we need to divest ASAP".
That is such a sane thing to do. I was always astonished and sad how often strangers in foreign countries instantly link my origin to the actions of the people in power. As if this is completely under my control and with no doubt I support and approve whatever they do.
People are nice and will continue to be nice to nice American tourists but make no mistake, there has been a severe shift both in the actions of regular people and business.
And for nothing. Normally you can at least get a good price for selling your reputation.
My only vantage point is from inside the U.S., but I find the loss of prestige completely believable.
What amazed me was discovering that my own countrymen would vote in, and continue to support, someone like Trump.
My political views are pretty centrist, and I thought I understood the views of most liberals and conservatives.
But I never thought there would be so little resistance to the lies, corruption, authoritarianism, and the breakdown of the separation of powers. And the simple incompetence w.r.t. running the executive branch.
It's like my mental framework has no way to model whatever is going on here.
If you don't like one party what other option do you have but to vote for the other party?
So as a result it's enormously easy for radicals to take over a big tent party and still achieve remarkable support.
It's a cult around Trump and then a (quite diverse) set of politically/culturally/economically-motivated opportunists surrounding him and trying to leverage the Donald's cult-building magic into whatever future United States they dream of.
Whoever speaks to him most recently before he steps in front of a microphone gets policy priority for the next media cycle!
It is historically in line with the U.S.A. The last few decades were the exception.
Certainly, I’m not here to spread conspiracy and I agree with you here, the results are the only evidence we have of the current situation. Given that, I think many of us were amazed.
I think that effect comes from astroturfing, algorithms, and tribalism.
The only way imo that a person gets any kind of genuine small sample of the varying vibes outside their circle is to speak with randoms in different geographic regions with a sense of humility, curiosity, and friendliness, in real life.
What you mistook for respect was fear.
In the 80s and 90s USA was idolized and admired. Yes, even in the 80s when officially Poland was still in a soviet influence sphere with soviet and communist propaganda being everywhere.
The word "Ameryka" was a colloquial used to describe something amazing, rich, high tech. The myth of American freedom, that in America hard work can lead to personal eneichment were told like fairy tales.
When Poland joined NATO it was like dream come true. There was this huge enthusiasm of becoming officially friends and allies of USA.
We looked up so much to the USA.
It's really sad to see that completely disappear.
Kind of insane that the American President just made up a lie that tariffs are paid by foreign countries and rest of the administration just went along with it. It flies in the face of any common sense.
Hard to see why companies would pass on a government imposed tax if it is an income tax but not a tariff.
If anything you'd expect it to be the other way around, because an income tax allows deductions for much of the cost of making that income which generally means the amount of tax is lower in times when the business is not making much money, whereas a tariff is on the cost if the businesses imports which can remain high even in times where the business is not making money.
The U.S. has lost so much in terms of even being able to produce anything that it's in a weak position not just in terms of trade, but in domestic security in and of itself. The lesson from COVID should be that ensuring domestic production of at least SOME of everything that CAN be produced domestically in the US should be ensured to exist.
As examples... IMO, all prescription medications/devices should require dual sourcing and at least 50% domestic production. This ensures actual patent licensing as well as being able to ramp up from 50% in case of a need (war/pandemic). It's nearly impossible to ramp up from 0, but easy to ramp up from 50%. This can/should be extended to essential infrastructure, communications and technologies.
Most countries don't have the size/scale/scope to do this... the U.S. and a handful of other countries are and should take advantage of that and ensure it for their own critical security.
I don't say any of this from an isolationist PoV, I think trade is important... I think diplomacy is important... I just feel that a level of domestic security in terms of self-reliance at a certain level is more important.
What is insane, though, is that people voted for him. Elect a clown, expect a circus.
I guess most voting Americans didn't need much to throw the country's century long superpower streak down the toilet. Or worse yet, just pretend that both sides are equally bad and not use their voice that many died to give them.
Deleted Comment
In the same way that Trump is punishing Americans with the import tariffs, yes. However that is just the primary effect, not the goal.
If you eat less you might go hungry, but that doesn't mean the goal was to go hungry. Rather it was to lose weight, and going hungry is just the direct effect.
Part of the goal of retaliatory tariffs is symbolic, part is to indirectly put pressure on Trump by affecting US export industry.
That is a very simplistic way of looking at it.
Tariffs are taxes on exports and like every tax tool it has its specific purpose.
Lets say US for example has surplus diary. It can export the surplus to other countries. Without tariff the only barrier is the exchange rate. If the diary prices are cheaper than local produce, US diary takes over the market and the US farmers make bank.
Canadian government might want to protect local diary industry. Or Canadians might have concerns about the chemicals in US diary. They have more stringent requirements from their farmers. Either way they raise tariffs for US diary products so that is on par or costlier than local produce.
Tariffs are normally a precision tool. Countries target specific goods and industries.
Now what Trump has done is taken a blunt hammer to it and said all goods from all countries will have tariffs. But if you look at retaliatory tariffs, imposed by other countries, it is precise and meant to hurt very specific industries.
For example, China has raised tariffs on US soyabean. In way it is targeted at US rust belt farmers. The idea being that farmers are a politically active class and if tariffs cause them pain, maybe Trump will come to the table. But that has happened yet. Maybe US farmers just don't care as they are winning too much.
Punishing their own nationals is very explicitly how this is sold to the voter base. "Prices are going to go up for you but unfortunately we have to do this to try to stop our neighbor from raising their import tax explicitly on goods from us".
Taxes are not a problem if everyone plays by the same rules. The problem for the economy is that some imports are subject to tax and others aren't, or when domestic goods aren't subject to the same tax. Picking winners and losers in an economy by political has never before in history turned out a winning concept.
Only silence or absolute truth should be accepted.
Dead Comment
Microeconomics 101: https://www.khanacademy.org/economics-finance-domain/microec...
The consumer paying the tariff is merely an optimization over the exporter paying the tariff such that the tariff money passes through one less hand. Practically they seem pretty similar.
Tariffs are a tax, paid on the value of imported good, by US citizens who are buying things from outside of the USA. That's it. They are not paid by anyone outside of the US.
Now tariffs are imposed, my import cost per widget is $139. Not only do I have to jack up my US price to $189, I have to jack up my UK price to £142, meaning UK customers are also paying the tariff now.
Even if you’re a bit smarter about your logistics and use an FTZ or drawback against the import duties, imagine you sell two widgets, one where you don’t pay import duties (bound for the UK) and one where you do (remaining in the US). Your total cost to import is $239.
Instead of making your US customers eat all the cost of the tariff, you might instead adjust your retail prices to $170 and £128 respectively. Again, now your British customers are paying an increased price due to the tariffs.
Of course not. They charge the highest price they possibly can in each market, regardless of other factors. They're not compensating this here or that there. Every company always charge as much as they can get away with, that is the core function of business.
Did they lower the US import price before the tariff is applied in the US?
Sony and Microsoft did price hikes outside of the US at first as an example of how other countries may be paying for US tarriffs indirectly. But as of a month ago these had to relent and eventually they did both do price hikes on their systems.
https://www.bbc.com/news/world-latin-america-28013157
https://en.wikipedia.org/wiki/Am%C3%A9rica_Invertida
But no, it hurt import businesses in unforseen ways. I saw entire shipment crates get discarded because it was suddenly too expensive to get into the country overnight and too expensive to ship back. Just senseless, pointless waste.
Deleted Comment
The whole idea of Swatch is based on simplicity, reduction of parts count and automated manufacturability.