Donald Trump the Megathread part II - mod warnings in OP, Updated 18/03/25

Keep up, sock.rocker*! The latest latest message is that electronics don't need to be made in America. Trump has just exempted computers, mobile phones, semiconductors, solar cells and memory cards from tariffs.

This has the bizarre outcome that:

• Import a battery from China - attracts a tariff of 145%
• Importa a battery from (say) Vietnam - attracts a tarrif of 10%
• Import the same battery installed in computer - zero tariffs.

And the same goes for all the other components that go into a computer, or a mobile phone.

So we have higher tariffs on intermediate goods used in manufacturing than on final goods. If you manufacture computers in the US, you will be subject to tariffs on the components you require. But if you offshore your manufacturing, no tariffs.

This pretty much explodes the never-very-credible claim that Trump's intention in imposing his absurd tariffs was to restore US manufacturing. A regime like this makes manufacturing in the US even less attractive than it already was. Even a man who is solid bone from ear to ear, like Trump, must be able to understand this when it is pointed out to him.

So, why has he done it? Reportedly, it's the result of, um, representations made by Big Tech — the likes of Apple, Microsoft, Nvidia.

Paul Krugman puts it well:

The stench of corruption around these policies keeps getting stronger. There's a lot of circumstantial evidence for massive insider trading around last week's tariff announcement; the big beneficiaries from the latest move are companies that made big donations to Trump. Investing in plant and equipment looks like a bad idea given the uncertainty, but investing in bribes for the ruling family clearly yields excellent returns.

Creating confusion and uncertainty like this is a strategy — intended or otherwise — for eliciting more bribes. You make, and then reverse, dramatic announcements; you trail yet more announcements; you have differet people in your administration say different things. You give people the impression that things are not yet settled, and therefore that there is still an opportunity to influence the decisions that will be made.

Of course, the resulting confusion and uncertainty discourages investment and paralyses business decisions, but that is a price that must be paid if the office of president is to be effectively monetized for the ruling family.

I'm not sure that Trump would particularly feel the need to hide payments. It's being widely reported that you can arrange a private dinner with the President at Mar-a-Lago for up to $5 million. Obviously people who pay that kind of money for a meeting with Trump expect to secure some influence and/or goodwill by it.

The money doesn't necessarily take the form of unmarked bills in a brown envelope that Trump slips into his back pocket. It could be a donation to a foundation operated by Trump, or to his political campaign, or it could be business placed with one of his companies, or one of his children's companies, or . . . almost anything. Trump would see nothing wrong with any of this and so would see no need to conceal it. The concept of "corruption" is entirely beyond him. He would regard this as nothing more than smart business, and he very much wants to be seen as a smart businessman.

What might he use the money for? Well, I dare say he could find a use; his style of life is fairly lavish and his salary as President of the United States is $400,000. He has many other commercial and financial interests which, in contrast to all previous presidents in modern times, he has neither disclosed nor divested himself of, so we don't really know what his aggregate income is. But, in truth, I don't think Trump would be seeking this money because he needs it for any particular purpose. Acquiring more money is something he would see as good in and of itself. Too much is never enough; there are always more bathroom fixtures that can be gold-plated.

On edit: where corruption is systemic, there isn't always a one-to-one correspondence between this payment made and that favour done. Rather, we have a fundamentally corrupt relationship, in which I regularly provide you with flattery and funds for no obvious reason other than my admiration for your sterling character. In return, if and when a public issue arises that affects my private interests, I am confident that you will favourably consider my private interests, so that the flow of flattery and funds will continue unabated. But at no point might it ever be possible to say that I made this particular payment in order to secure that particular decision, or that particular contract, or whatever.

https://www.theguardian.com/us-news/2025/apr/14/trump-warns-exemptions-on-smartphones-electronics-will-be-short-lived-promises-future-tariffs-president-china

In the post on his Truth Social platform, Trump promised to launch a national security trade investigation into the semiconductor sector and the “whole electronics supply chain”.

A flippant prediction but I think Taiwan will be told that TSMC must produce the latest chips in America or there won't be any security guarantees against a Chinese invasion. I think he'll treat Taiwan like he's treating Ukraine.

State censorship. Just another step on the road to fascism.

My wife is from Pittsburgh and uses that word all the time. We go “grocery shopping” every Sunday.

I've no doubt that people close to him are making money off his constant tariffs changes, but I think he doesn't have a general plan other than "tariffs good", which he then tweaks as big political donors ask for exemptions.

But even they doubt that what they explained to him yesterday will be remembered today, and so yesterday's waiver gets tweaked again etc...

Yes. The point being made is that this belief on Trump's part is probably genuine, and it illustrates how disconnected he is from the lives and experiences and concerns of the great bulk of Americans.

(That, or it illustrates he is developing aphasia — the inability to remember or recognise words — which can be indicative of dementia or of several other conditions.)

That's the point.

Back in the day, when Irish governments sought to use tariffs to protect/promote employment in Ireland, we had a tariff on vehicles but no tariffs on vehicle components. The thinking was that this would encourage the development of a car assembly industry in Ireland and, to some extent, it worked — a number of manufacturers imported "car kits" (chassis, engine, transmission, etc — the whole caboodle) to be assembled either in Irish plants that they owned and operated, or by Irish companies with whom they contracted. (Of course it did mean that the cars concerned were more expensive in Ireland than they otherwise would have been.) The policy was progressively abandoned in the years leading up to EU membership, and by the early 1980s the motor assembly industry was gone.

Trump is doing the exact opposite here — allowing the finished product to be imported tax-free, but taxing the components if imported separately. If this policy is maintained it will have the exact opposite effect to the Irish policy — anyone still engaged in the domestic manufacturing/assembly of the products concerned will move their operations offshore PDQ to avoid the component tariffs.

Don't know about pharma but there's been a good few estimates about iPhones ranging twice to triple what they cost now if made in the USA.

That would involve smarts.

Who needs that when you have Jesus and Trump?

Bit of a stretch to claim Viagra, Botox et al as essential to national security!

There's a list of essential medicines somewhere from the WHO, I'd be surprised if the US isn't producing any of those it needs already.

Bit of a stretch to claim Viagra, Botox et al as essential to national security!

Both of these are required for MAGA to breed offspring...

There is no "plan" whatsoever. Trump hasn't got a clue what he is doing, hence the constant flip flops and U-turns. That would be fine if he was playing it very safe, but someone who is clueless trying to turn the entire global economy on its head is clown show territory.

His crypto coin launch the Friday before his Monday inauguration