TARIFFS & Tool Prices! (What is a Border Tax & How could it increase prices!?)
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- Опубликовано: 28 янв 2017
- There is a lot of talk in the news these days about Tariffs --- specifically how it "could" raise the prices of things in the USA if/when they are implemented.
This video is to explain how a Tariff works, why it is sometimes needed, and who is actually affected by them.
What are your thoughts on a Trade Tariff? Are they a good or bad thing?
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LOL Ok without going off the deep end this is my take. As a Canadian I say I have seen enough proof that trade with countries with super low wages and no regulatory standards do nothing but destroy the domestic manufacturing of your country. So the domestic companies go to where the cheap labour is . In a nutshell i say no trade with countries with super low wadges and im willing to pay more to keep the jobs in America. This is a great topic buddy.
STEVE ROB my brother a green with you a hundred percent I don't care if I have to pay $10 more I always buy American if I can I try to keep away for more Chinese Mexican Indonesia all those type of countries that exploit the worker that means cheap labor I can't stand it
STEVE ROB i agree*
John Wires Trade throughout the world is a good thing but trade that is distorted and wreaks havoc on a country's manufacturing base is not good for a country or the person without a job. How can we compete with under $2 and hours - we can't. If you want everything made in 3rd world countries that's your choice but for me i've seen enough of this and saying if you can't compete go away is exactly what's been going on. LOL Great topic and thanks for the exchange of ideas. Cheers
John Wires John i agree that offshore countries can and do build world class products. There's free trade and fair trade, either way its corporations that will go to a low cost country and build their products and sell them in america at market price not a reduced price. A car built in Mexico is priced the same as a car built in Michigan but the mexican vehicle costs less to produce. Its a complicated subject but i think i wouldn't mind a couple of years with the tables being turned and lets see the jobs come back and the entire outcome. Im willing to say its time for a change, HAHA Ya ever heard that phrase before. Cheers John
STEVE ROB Amen brother
iirc the bionic wrench inventor sued over patent infringement and won after a nasty battle.
Same thing happened in the 80s when everyone started buying Japanese cars, because of the poor reliability of American cars at the time, the politicians put huge tariffs on foreign cars. So what most of the Japanese companies did is build plants within the USA, mostly in the South where non-union labor was more common. The tariffs didn't work because people still were buying Japanese cars at an even higher rate than before the tariffs.
Overall it's a good thing though. Nissan is HQ'd in Japan but Smyrna plant has over 8,000 employees. They have 4 US plants total, that's alot of americans making alot of money and spending it here at home. Still it comes down to if you sell overpriced garbage people will go somewhere else. That's easier to do when all options are in the US
You just refuted your own argument buddy. The foreign manufacturers moved production to the USA. Creating jobs and increasing the prosperity of American people. Ergo the US did benefit from the policy you mentioned. If the only goal was to aide US carmakers and specifically Union jobs, them you are correct the policy failed. I think it is very important to note though that the tariffs you are mentioning had a completely different goal and target than the tariffs of the last three years. The tariffs from the 80's were anti-free trade and were meant to pander to Union voters and the tariffs targeted Japan. Japan during the 80's, and today, is a much fairer trading partner than China. China has been engaging in outright theft from the US for decades to the tune of hundreds of billions of dollars a year. Our trading relationship with China is NOT sustainable. We should all support the idea of forcing China to commit to free and fair trade. The critical difference between the tariffs you reference and Trump's tariffs is that the 80's tariffs were meant to advantage US companies, whereas Trump's tariffs are meant to disadvantage China. The truth of tariffs, as you point out, is that they hurt both sides to some extent. However, for many reasons, including the great trade imbalance between the US and China, today's tariffs are hurting China more than the US. Short term and minor economic pain today is worth long term sustainability and free trade between the US and China.
Excellent explanation. As a steelworker, I have witnessed first hand the detriment of foreign steel being dumped into the US. The quality, specifically coming from China and Russia, is horrible. Every chance I can, I buy US made product or at least from countries with a reputable trade agreement with us.
Very true. Unfortunately my employer buys Chinese sourced pipe fittings that fail sometimes within days of install. The stainless is absolutely horrible.
I ran into the exact same thing with Chinese "stainless" pipe. The stuff was rotting off in weeks on a brand new $13 million machine. It was also all weird sizes on flanges and threads and spare parts were essentially impossible to buy.
On that machine in particular, I had to beg the plant to finally switch it over to treated water, and install EXTRA filtration, instead of just straight ground water like every other machine in the entire facility. Then we started getting about 9 months out of stuff instead of 90 days. When I left the company they were in the midst of replacing about 1/3 of the machine with first world made components at the cost of about $4 million.
it's going to get interesting at harbor freight real soon.
One just opened nearby, I wonder how long it lasts. When I was buying tools in college the parts stores had a really hard time producing options of Made In America tools that I was asking for. Really makes me sick.
Even at 20% more money, HF is still a steal on some items. Their impact sets are easily worth $50 as opposed to the $35 they charge now. I don't see HF going anywhere.
grainger still carry large option made in usa tool. i find myself, when i start use garmany tool ,i can't go back.
I don't think they'll go anywhere either but it will be different. It really depends on the quality your getting for the price difference. I have some of their impacts too, yup they work. Overall however their quality isn't very consistent when compared to another "house brand" line like Kobalt. So if they have to compete more with the likes of Rigid and Kobalt how is that going to impact their product lineup? Do they just eat it to sell the tools to the retail stores at the same price they do today? If they do, that's money they can't use to improve their offerings. It could actually be enough of a change for the quality to drop on "go to" tools like their impact sockets.
Peter Petrakis I was just thinking that as I was in there today
Agree 100%,
It's not just the jobs lost overseas, but the skills that we lose when those trades are not needed in the USA/Canada. How many generations have to go by before we can no longer make anything ourselves? When China manipulates their currency, and ignores worker and environmental safety, just to dump manufactured goods on our shores until entire industries are lost, all the tariffs in the world won't help because we will have lost the skill sets and experience to rebuild. I hate the loss of jobs, but the loss of skills scares the hell out of me.. Bring on the tariffs, and watch Wall Street squeal. We could always import lower-cost CEO s from China if we need to lower the labor costs......
I only hope that when these jobs come back to the United States the American worker(s) appreciates what was done for him or her. I have 30 years in manufacturing and have seen my share of workers who come in drunk, stoned, hungover, and just plain tired from partying the night before. I wish I had a dollar for how many times I've heard things like. -- I don't care! It ain't mine. --- Who cares? Someone else will fix it! --- This place sucks man! etc. It used to be said "Never buy a car that was made on a Friday or a Monday!" 21 years of building heavy trucks tells me that's true! I only hope that the US Auto worker(s) realizes what's been done for them and not revert back to their old ways a leaving Coca-Cola cans rattling around and things they've helped to assemble!
I would foresee this creating more USA made tool companies and even prices dropping on certain tools.
Real Tool Reviews this would also possibly make incentives for companies that manufacture overseas to open up shops over here and creat American jobs.
Create
Maybe we could see some US made power tools again.
Azathoth43 That's why I choose to support DeWALT. I understand that they are still using gloabl materials, but they have made a strong manufacturing effort here in the states. They are paying American wages and American taxes and STILL remain cost competitive. What other power tool company is manufacturing here in the United States? At the very minimum quality control is going to be much higher. Not to mention the employees our putting money back into OUR school systems, Our emergency services etc..
Justin D don't be fooled my marketing giant DeWalt. They can throw one screw in a tool here and claim it was made in the USA. As far as other companies go I've seen a Milwaukee rep in just about every home depot I've been to, seen a DeWalt rep once. My point is just because they aren't factory jobs doesn't mean they arent hiring Americans. Another fun fact is every single sawzall & hole saw is made in Mississippi, USA.
I always do my best to buy "made in the USA" when possible. Not only do I feel it's better for our economy, in most cases although the purchase price may be higher I find the tools to be better quality and last much longer. So overall the cost is LOWER! If it takes tariffs to keep some of those extracted dollars here in the USA, and those corporations want to continue to produce their products overseas, so be it! To improve our economy we should be interested in ways to keep manufacturing here!
Great analysis on trade and global economics. This is one of the best explanations on the science of trade and tariffs that I have ever seen. Thank you!
hey man thanks for the video. I'm 15 and so prices on tools is important, I prefer made in USA but its all about Quality for me.
I believe in tariff reciprocity with other countries on a equal basis. Dollar for dollar equality. If other countries put tariffs on American products, we should match the amounts.
I love the matchbox and battery demonstration. Made me feel young when there's trouble out there haha.
Great video! Thanks.
great job on explaining the tariffs
One item people are not thinking about is that if any new factory comes back into the USA, it will be mainly full of robots with just a handful of humans in it. And many of them will opt for non-Union states due to cheaper labor.
Looks like we should start making robot factories now.... ;)
Yes robots making robot factories - remember judgement day is coming just watch the terminator movies for more information
Just carry around some WD-40.....a robot will take you on as it's pet, so you can keep it rust-free.
You're assuming that the exchange rate won't be affected, and you're also assuming that the domestic producer won't alter his price in reaction to the higher after-tariff price of the imported product. Both those assumptions are untenable.
Awesome video like always 👍
Good video, thank you.
so knock off snap on stuff is going to cost what real Snap-on stuff costs
Thanks for some great insight. Great video. More Podcasts please.
Another excellent video!
+LA CAJA DE HERRAMIENTAS WALTER ALVAREZ thanks Walter! 👍
great video couldn't agree more
I'm not convinced the company would eat the cost TBH. Let's say Milwaukee decides to pass cost on the consumer increasing their price. If I were an executive at Rigid I'd just raise my price to match and start lining my wallet, who doesn't like extra profit? These companies are always scoping out their competition's pricing, manufacturing strategies, marketing, etc.
Cheaper price tags don't always win. Harbor Freight hasn't put Snap On out of business for example. It would be easy to mark up the made in USA tool to match a tariffed Chinese tool and claim it as a premium product. But that's just my thoughts and opinion it's just as good as the next guy or gal's. Thanks for the video!
Fair enough. I don't really agree here but time will tell. Branding, notoriety and marketing play a roll in this too. The closest thing to this I can think of is the Chicken Tax and that had some strange consequences too. Interesting times to be around.
very well done...
Great video!
While on this topic... Anyone has any idea where I can buy some nice USA manufactured industrial scissors/shears? The closest I've been able to find is a German brand and they're like $120. I'm not a professional and don't need that level of quality, but I need something better than junk.
For the most part, free markets make for better products for a competitive price. When it comes to tools I learned my lesson. My father in law gave me a cheap china made pipe wrench. I just about broke my hand when the entire wrench broke. I only buy ridged and Snap-on hand tools that are made in the US for quality reason. I think I am in the minority of most Americans as they buy what is the cheapest item they can buy. I wish companies that make stuff here in the USA should market it as a quality piece. Great video! Cheers to all of you that buy American.
buy American and support industry here. I feel this is our last chance to bring back a solid foundation to the country. We need people working and producing again and taking pride in what they do.
Nice job of explaining this. in Canada we have duty on most items from the US. This makes things very expensive with our weaker dollar. Often Canadian made products will be more economical in the long run when shipping, duty, and Exchange rate are involved, that is, if the item is available in Canada. in many cases items are only available in the US. Seems items from China must be exempt from our import duty, as there is no obvious duty on those items and often free shipping if you are willing to wait 4 to 6 weeks (eBay and Amazon anyway).
It is frustrating, to have to pay duty on items that have no Canadian made alternatives, I see that as a potential flaw in the system as you have described.
Never mind the insane shipping costs between CA and the US. If I want to send something 250 miles from my house into southern Ontario it's like $30, but I can order a $0.40 USB cable right from China with free shipping.
It's the same story with basically every free nation on Earth. Buying stuff from the UK? Forget about it...
@realtoolreviews i know this is off topic but it be awesome if you did a review on the milwaukee pipe wrenches
Thank you good sir!! It is very important that is tradesmen inform each other about political matters, especially ones that could greatly affect our industries. The liberal narrative is that tariffs only and/primarily affect the end consumer. This narrative is intended to hurt Trump and his agenda. However, more importantly, the media's narrative on tariffs greatly aides China and other unfair trading partners affected by Trump's tariffs. We need to support tariffs and Trump's economic policy, even if we do see some elevated prices, as the long term effect of his policy will be more jobs and more prosperity IN America. Thanks again for making this video. Too many of us tradesmen are afraid to venture into political matters for fear of alienating friends/ follower's. Absent the extreme polarization we see in our country today, using some forms of protectionism to affect fair & free trade in the long term shouldn't even be a political issue at all.
I stay non-political.....this video was simply to explain where (most of) the money for tariffs comes from.....and it typically isn’t the end user.
We keep hearing "These manufacturing jobs aren't coming back" but that doesn't have to be true. If the countries where the products were made had to comply with labor and environmental laws, then the costs would be equivalent, and a lot more when shipping them half way around the world is factored into the total cost. Companies are exploiting foreign workers, damaging the environment (no such thing as local pollution, its global), and that cheap product or cheaper product has hidden costs associated with those things and many other externalities.
great video, but working management in a big box store has showed me that your educated guessing on the costs are off by quite a bit. I see the mark up on USA hand tools tend to be around 50% for the stores, while foreign made can be much more. in fact, I've seen $20 tools cost around $3-$5. also, those $10 batteries are sold at a huge loss
Corey Fromille great points
I can tell you for a fact that all of the batteries sold for Kobalt besides the 4 amp is sold for a loss. I've checked the cost multiple times.
He's correct on the batteries being a loss leader in the discount tool brands. I can't even buy generic cells straight from China to rebuild my Ryobi packs myself for less money than a whole new pack costs at Home Depot. The closest I can get comes out to a dead wash.
In the premium brands I'd agree that batteries are super-high markup items.
Say what you want I still know the exact cost to my store and it is more than what we sell them for. This is fact, not an opinion.
That $10 pack is literally 1/3 the cost of what I can buy the cells inside it for. Volume discount do add up, but they don't make things free.
As I said, you're dead correct when you're talking about $130 batteries being a huge profit center, but when you get down to the bottom of the market at the $10-$40 batteries there just isn't that much meat left on the bone. In many cases you can't even buy used surplus cells that cheap.
American Workers need jobs ... that is the important thing. Look at the cities where jobs have left ... not good. My question is the quality of the pipe wrenches?
John Grady As a plumber/fitter I wouldn't dream of ever using anything but a ridgid pipe wrench. Those orange steel ridgid pipe wrenches are indestructible. Will easily hold up a 200 lb man with a 6ft cheater hanging off the end of it without even bending. Still haven't seen one break. When working high up I don't think I'd want to risk my life by using a Chinese pipe wrench. If the wrench were to slip or break and throw off you balance you could get injured... I guess your family could use that extra penny you saved to pay your medical bills/funeral. Also why not help your fellow American/Canadian? At least when you pay an bit extra for North American goods it keeps jobs here. I say all non north American goods should have tariffs and the only way around it would be to have a manufacturing plant in NA. If you want to sell stuff here without a tariff you have to produce it here. These coments saying tariffs are bad and that we need more Cnc and automated assembly lines to be able to compete? Really does that sound like more or less jobs for North Americans? Who gets the profit from it, definitely not the person who used to assemble the stuff and is now un employed.
fourtysix4646 would be nice if they made more of the power tool stuff here too...
Moral of the story, bypass the retailer and order directly from China, I keep the savings.
Not that long ago you could buy tires for almost nothing if they were imported (mainly from china). A tariff imposed on said tires caused the prices of those tires to go up drastically. In theory the companies could have taken the increase in tariff as a loss of profit, but that's not what happened. The imported tire prices were raised, and they were soon close to the price of American tires. In theory this would mean more sales of American tires since the price difference is so little. Again that's not what happened, the American tires were raised in price. Some of it is consumer thought process, there are certain legacy brands (good year, bf Goodrich, firestone, etc) that people view as being better than imported brands, and consumers expect to pay more for them. If a crap no name tire is 50$ and a well known name brand is 50$, the well known tire will obviously sell better. Better sales equals prices being raised. And lets be honest here, major tire companies wont sell a "premium tire" for the same price as a no name tire even though they could afford it. That's why I don't see how a tariff will actually lower consumer prices on anything. If due to a tariff, all china made hammers cost the same as a estwing, do you really think estwing will continue to sell hammers at the same price? It gives them the ability to increase price and thus increase profits per hammer since they don't have to be as competitive. Competition keeps prices low, and anything that reduces competition will increase prices. With the china hammer theory, if the china hammer costs 50$, and estwing went from 50 to 100$ for a hammer, what choices do consumers have at that point? They can't buy a new hammer for less than 50$, and if they want something better than the low end they have to pay more. Not to get off topic, but one of the biggest goals our government should be working on is getting as many living wage jobs available to the average American as possible. Ultimately most Americans are not going to be doctors, lawyers, etc, and if the average American only has 8-10$ a hour jobs available to them unless they go 40K into debt for education, there is a serious problem. What's killing our country is the fact everyone seems ok with the fact mega corporations make enough profit to pay workers living wages but refuse to do so. Tariffs will surely increase profits for American companies, that's great in theory but very few companies will turn those profits over to the workers in the form of better wages/benefits.
Lake School Restoration Channel . I agree with your statement completely. American companies make more than enough profit to pay workers a livable wage but refuse to do so. Why is it that American CEOs need to make $100 million but refuse to pay workers more than minimum wage? The right-to-work states in the south are an abomination.
Boy... I can't wait to see how much a set of sockets cost that were made in Mexico from Snap On. That's gonna be wild.
those 28 dislikes were from import companies in Mexico, China, and Japan.
I'm no economics whiz. In my 60 years of life I've seen many tariff type plans go into effect, in theory it sounds logical but in the real world seldom works as planned. When tariffs go into place those companies benefiting from them instead of accepting the same profit margins with the promise of increased sales almost always raise their prices to extend per unit profit at the expense of possible lost sales. If companies and the humans running them would stop being so greedy tariffs would work but they almost never do, they just help raise the overall cost of everything, and there's often a backlash from the offshore countries being affected, where as they then raise tariffs on any of our products reaching their shores. I say let the free market do it's thing, I just wish the American consumer would become a little more savvy in their buying practices, which programs such as this helps do so.
Titus Tucker What is your opinion of the new tariffs Trump is implementing? How do you think this will play out?
As much as I love Milwaukee I would never buy anything other than a ridgid pipe wrench. Spend the extra money and keep the profits in USA/Canada.
I'm curious about the wrenches. I'd like to compare the grab of each just a little more than where they are made. I DO care where they are made but if i'm working blind under something with one hand trying to get a bite on something I want the best wrench, the one that slips and bites better. Even unfair competition can boost inovation. Complicated.
I would love to see a video comparing 1/2" ratchets. I have had some experience with some different manufacturers of ratchets like Craftsman, Armstrong, Proto, etc. but I would love to see what you think.
A_Bean thorsen sk and proto were dam good tools also craftsmans especially from the 50s best tools ever made hands down
i think its good but being a back yard jack of all trades i tend to buy the tools that suit my need in a price range i can afford with in reason
Companies bringing in goods from China and other sources purchase based on a purchase price-point so they can hit a desired product sell-cost. If you add a tariff to those goods, there are basically two entangled outcomes: the buyer demands a lower unit cost to compensate for the tariff so the maker has to do something to reduce costs, which usually means skimping on the quality of the product. The price we consumers pay remains the same, the quality decreases and we end up paying a tariff, as consumers, for a lower quality product. Not all tariffs are bad or work this way, but they need to be reasonably thought through rather than punitively enacted.
Can you do a review on the new ryobi 1/2" impact wrench
Im curious to see how many of these companies will sacrifice quality to compensate for the loss of profit margins...
They probably won't.....they will cut advertising & personnel costs (i.e. -- no more sponsoring Nascar, such as Lowes cutting it after 2018). The problem is that they will have to compete with a lot of competitors for a limited amount of customers.....if they cut quality & keep prices the same, they will lose. Back-end costs are what will go first....
Comparing Dewalt to Milwaukee especially when looking at prices is like comparing Boons sparkling wine to a nice merlot. Especially when looming at a fuel brushless.
So any thoughts on what happens when one of these manufacturers sell those same tools to other markets? What's it like to sell those to Europe or Latin America or Asia from China vs from the USA?
All of this makes great sense if the USA is the only market that these companies sell pipe wrenches to.
Lib Smiter seems legit
Practically speaking, the US is the only market for these tools. Asian and European countries engage in a great deal more protectionism and have way higher tariffs than those being put forth by Trump. Also, the other markets you speak of are dwarfed by the US. China exports close to a trillion dollars a year to the US and they are not going to be able to find any other market to replace that revenue. Additionally, the high labor costs of the US already make it nearly impossible to sell US manufactured tools to emerging markets in the third world. To conclude, the US stands to gain way more through eventual free/fair trade than it is losing through the current tariffs/ trade disputes, and China cannot afford to continue losing its market share in the US. Especially when you consider that China's debt vs GDP is three times worse than America's and has only been able to sustain such high levels of debt through its trade imbalance with the US.
Where did you get the Maine license plate I live in Maine
Interesting however I feel you have taken a very simplistic approach to it and used a lot of estimates or guesses as to the costs and profits involved. Once the tool manufacturing has moved overseas the setup costs for an american company to start manufacturing are substantial and extremely risky. You are also assuming that made in USA is a substantial increase in quality over imported. That is not always the case as we are seeing with US made cars. Lots of defects failures and quality issues.
Yeah trade wars always end well for the consumer.
I'm not an economist and I'm not going to pretend to be one. Everything you said sounds good but the one thing that would worry me is these companies colluding with one another. If dewalt decides to sale gas for $3 a gallon (in you example) what's to stop the other three from raising their prices?
I thought you were going to test the strength of those two tools!
wish ridgid wrenches were $43 in the uk...lucky to get banged out second hand for that price but theyre the only brand worth buying! better still i wish i live in the USA. i appreciate your national pride and patriotism
Hopefully Brexit will let you negotiate your own trade deal with the US and we can resume REAL free trade again very soon.
Adrian Templeman, you are experiencing tariffs first hand.
One thing that you didn't discuss is that when we impose a tariff on a particular country, their natural reaction is to impose a reciprocal tariff. That ends up making our products less competitive in their country, which could result in job losses here. Also, I'm not going to switch from Dewalt batteries to Milwaukee batteries if they raise the price as they won't fit in my Dewalt tools (but I might use Chinese knockoff batteries that I can buy on Amazon.
Compare the two pipe wrenches to each other, which is better. I always choose anything other than China made products, prefer items made in the USA. There is something wrong with Chinese steel, it's just different.
well that's all assuming that none of the extra profit margin is transferred to the store. stores like Walmart, Kmart, target, probably even home depot are already struggling to survive. home depot has an edge due to it dealing with contractors who may not care about prices. but ultimately stores are already losing money a trade tarrifs would just make it happen quicker resulting in more stores closing. which is people losing jobs. to avoid that they can raise prices for their products (more likely than not, including the American made stuff) which would result in us, the consumers, paying for the tarrifs. tarrifs are just a way to make competition unequal. Americans have the capability to automate their production processes and make their products more affordable. but most of them rather charge the most they can while not optimizing production. I believe tarrifs will have an overall negative impact on most businesses. also I'll give one example of a small scale manufacturer. the guy who makes the j-head (hotends.com) charges 60 dollars for something that probably costs him 20 dollars to make and a week to engineer. he complains that he can't compete with China and that a tarrif would benefit him. I asked him if he has ever thought about lowering prices and he said nope. I asked him if he thought about optimizing production he said nope. he wanted people to buy his product just because it's American made. he doesn't want to compete. which is why tarrifs is a popular theme. people don't want competition at all. which is just them being lazy. also you have to take into consideration that some companies layoff employees strictly because it's cheaper to not have them. by law CEOs have to maximize profits. so unless we put a tarrif on every country we deal with manufacturing jobs would still be lost. and they have always been in decline. prior to NAFTA we were already losing American manufacturing jobs and after NAFTA it just made it more obvious. imo as I stated before the appropriate solution would be to invest in education so that the individuals in our country can design something worth exporting that no one else has the skill to manufacture. which would create jobs and give us high value products to sell. for example our military goods. (although I don't think military goods should be our leading export) And finally many companies depends on their sales in foreign countries. the last we would want is a trade war. China/Mexico is a big market for US goods.
What are you talking about? Walmart and Home Depot are the number one and two retailers in the US. They aren't struggling at all.
Maxwelhse yes they are. Walmart is slowing down opening stores and if I recall correctly they might be planning to close a couple. Amazon, eBay, and other online stores are hurting the profits of stores like Walmart. And those businesses employ much less individuals for each area they serve. And as they automate their warehouses their number of employees will just continue to drop. We can do whatever we can to get manufacturing jobs but I would predict that we would lose much more jobs than we gain.
Maxwelhse especially if you take dollar and corner stores into consideration
There is such a thing as market saturation too. Walmart has 5,300 US stores. You don't need to be able to throw a rock at one Walmart store from another Walmart. Simply hitting the limit of what the entire population of the country needs is not a sign of doom, it's a sign of success.
Any organization that size will always be closing under performing stores. I worked at a Home Depot that was closed about 10 years ago, that was in business for 10 years, and that store never made a profit. The store 10 miles away was one of the busiest in the country. Another HD closed at the same time and it was the highest theft store in the world for HD. So, some of those closures are just "no brainers" at the end of the day.
I don't deny that competitors like Amazon apply pressure to brick and mortar stores, but Walmart is keeping pace with them too. The company is in no danger of going under, which is what your original comment implied.
K-Mart, Target, etc are all different stories.
Maxwelhse so let's say Walmart is not losing profits and closing stores (which they are) every other business would be. IMO it would still be an issue
milwaukee is own by company from HK(basicly is china) and most the tool made in china, when my co-worker say they are american company. i keep my mouth surt. because they may spent $1000+ already on milwaukee just support company name, and do nothing for local labor and economic for state. that why i use power tool for makita much as possible. i just want best value what i pay for.
Great video! I can't wait to read the upcoming comments from this one! Hopefully the conversation doesn't get political, and stays focused on economics. Either way, I agree. Competition will save the consumers wallets.
best channel !!!!
Since the 90's I've been told that we are becoming a service economy. Near as I can figure is that's like saying my best subject in school is recess. No wonder we got NAFTA in the first place.
you aint good at figurin' don. stick to what you know
I try to by usa maid tools even if they are more.
Interesting debate.
Another great video with great content. I still source my parts locally and ship worldwide there are tariffs duties etc to be paid to most places I ship out to. On the flip side I have bought some tools and other things from overseas and have not yet been required to pay any import tariff. So are American companies the only ones paying to export now? While we give a free ride and a bunch of jobs to all overseas importers? Also consider if free trade (no tariff) with Mexico, Canada and USA only wouldn't wages go up quickly till it was no longer viable to move a company to Mexico and because they have job wont be trying to immigrate on mass. No longer a need for a wall. However China out ways all of America so much in population that we would run out of manufacturing companies long before they are all employed and long before they get any significant wage increase.
he did not account for one thing with the gas station example.
the brand loyal jackoffs will pay more just because they are stuck on one thing..
At its base its a tax, weather the company (and employees), or the consumer pays, things will cost more to someone. The only one with control is the companys, which I believe will like most lead to monopolies in order to control the variables, and insure the cost is placed on the consumer, as to not interfere with profit margins. If we buy less of one company or another, its like sharks praying on the weak, forcing buyouts. With all the known examples of this, its the ones playing chess not checkers that come out on top. Ultimately it ends up being the consumer getting taxed.
Noticed last few videos that the outro is gone, what's up?
Streamlining vids....I am working on a new intro also.
Do a video about hilti tools.
You left out shipping and other costs of manufacturing overseas, which can be signicant. The economics are much more complicated than this which, unfortunately, means your conclusion is not correct.
...and literally no tariffs. I think the highest tax on Mexican goods, for instance, is like 2%. In comparison, the average import tax rate in Brazil is 23% and can be as high as 55%.
Tariffs are perfectly appropriate for some countries but really not appropriate for others....for instance ,when I was in the Philippines ,I was totally surprised by how much USA made products were even though pricey. In the malls I would occasionly find a gunstore carrying smith and Wesson, Ruger, Colts and others.And they were being sold. I therefore had no misgivings whatsoever about buying a Philippine made Buckmaster Scope here in the USA. The USA is NOT the only country that has been harmed by Chinese trade practices. We ,as a country should focus entirely on countries that repeatedly have a massive trade deficit with us...(not Canada, Not the Philippines) The culprits, in a big way are China, Japan and Taiwan.
Fair trade please
To assume that foreign labor is comparable even by the standards you proposed is considerably generous to the real truth. Pennies on the dollar on labor in comparison to the USA labor cost. Communist nations force (impose) 14 hour work days, 6 days a week for a wage that is heavily taxed, yielding a net income that is 1/10th that of a comparable USA factory workers wage. Having said that, the profit margin to the corporation that has contracted the "slave labor" manufacturing facilities in China (for example) is where the money goes. To the 3%ers.
Having said that, your estimates are skewed in favor of the employees, which is incorrect. The Government retains a minimum of 60% of the LABOR forces income, then the US based Corporations top brass retain as much as 75% of the profit for their lavish life styles. It's been an on going problem. Greed driven business decisions vs. pride in your USA made product and appreciation (profit sharing) that is passed on to the employees. The latter has gone by the way side. The US employee gets a forced wage reduction to "compete" with foreign markets while the top brass are making more than ever before.
With all this taken into consideration, the tariff would level the playing field, but I'm afraid it would also cause a decline in US employee wages. Think about it this way. The same product, for example, your two pipe wrenches. Currently Rigid is paying a fair wage. Imposing the tariff will cause the Milwaukee Corporation to figure out a way to retain their top brass lavish lifestyle in lieu of the tariff increase and wanting the profits to stay in the 75th percentile, they would possibly bring manufacturing back, providing jobs, but maintaining their profit margins means their employees would be the ones who suffer with sub standard wages. The problem is at the top and where the issues must be addressed. Impose a profit cap TO the Top Brass, enforce a "Fair Wage" and a Total Profit cap all the way down to the distributor and you MIGHT be able to maintain the quality of the product, provide a fair wage and keep the top brass in check. Greed has taken place of pride in the product you offer. It's changing that mentality, which anyone can tell you, is a near impossible task to undertake. It's going to take much more than just an import tariff to remedy the problem that's plagued American Corporations for the past couple of Decades.
It used to be, we made a product, we stood by it, we made it to last, and not engineered to fail, we appreciated our workers and rewarded them with a fair wage and the top brass still enjoyed a "good" wage. Greed is the Devil here, and it's not going to be easy to force Corporations Top Brass to forego profits over moral justice. But one can hope that we can get back the Industrial power house that the United States once monopolized.
Excellent topic to bring up!! I have similar videos on my channel, where standing up for what's right against the tyrannic top brass of today's Corporations by ALL is the only way to force them into submission and do what's right for all, not just what's right for their wallets.
Cheers!! Zip~
ZippoVarga Hey Zip, what are the videos you have on this subject? I may want to subscribe to your channel.
ridgid way better pipe wrench. but ya i can forsee it costing more for tool for a few years but price will start to drop as more stuff is made in the usa and price competition starts to complete with each other
great idea, boost domestic manufacturing :)
This video is dated. Looking at the DOW for the last few days it declined app 200+ points with the fear of new tariffs. As soon as it was declared that additional tariffs would not go into effect till December rather than September the DOW went up 400+ points. This has a effect on many items we purchase!
How did you calculate labor, parts etc. as an economist you could theoretically add in social benefits/costs such as environmental damage etc.
+non yobussiness I kept this as simple as possible, so everyone can understand how it works.
Real Tool Reviews okay you should do more videos like this!
yes sometimes i think this is shear robbery if i see the price differences
The Loggerhead example isn't necessarily the best. The only reason Sears was able to knock it off was that Loggerhead didn't hold a patent on the design. Loggerhead engaged Sears in litigation, but it was based upon claims that Sears infringed upon trade dress. Loggerhead lost as the trade dress claim was tenuous at best.
I won't buy Sears tools. Loggerhead signed an exclusive 1 year distribution agreement with Sears. After one year Sears found a way to manufacture the tool without Loggerhead. As I recall, the patent pre-dated Loggerhead's production of the tool by 40 years.
Companies are not in the business of losing money. They are answerable to share holders. I think they will pass the cost on to the consumer in some form wether it is marking tools as "pro" grade or skimping on quality of materials. They will make up the cost.
I am not a fan of these types of "reviews" - hope you continue the tool reviews and leave the geopolitics to the talking heads.
That's fair. I know you are being helpful. Your reviews are some of the best and I hope you continue for a long time to come.
The adjustable pipe wrench, that is a swedish invention! And so is the adjustable spanner....
you are naive to think that the companies will eat the costs. and who does the tariff go to? the everyday person sees no benefit to it. all it does is cost us more in the wallet.
Real Tool Reviews most people pushing for a tariff also want to cut most social or welfare programs. also if we don't put a tariff on all import items it further skews the market than to let it find its own median. it's the land of the free, not the land of forcing your hand on what to buy. if you don't want or like import goods, then fine. you did have to buy them. An extra tax on the end user won't stop unfair trade.
Real Tool Reviews I never said anything about state to state. what about quality tools made overseas? what if the production costs are the same? why should we crutch equal or possibly inferior domestic products? we need to leave the market alone or we and no better than the under paid competition. it can damage trade and could lead to overall lower sales and less total tax revenue. politics are much more complicated than this video entails. I enjoy your reviews and can agree to disagree.
Lib Smiter then ban the sales completely for those companies, don't tax all products from the country. it's punishing all based on some.
The tariffs will only affect those countries they are applied to. Not every good imported to the usa. Most products that come out of china are junk! Im all for tariffing goods coming from china.
Even economics 101 tells you that a company will have trouble fully passing on the costs to the consumer unless we're talking about a monopoly. Go read up on some basic economics.
I agree, people are in panic mode especially with autos. I work in the auto industry and all this means is that manufactorers are just gonna be bringing jobs back here to avoid those fees. manufactorers moved jobs out for low wages so the ceos and corporations made a ton and didn't care about the workers. I buy American made as much as possible and as you showed its usually the same price but I garauntee the American made one is of better quality. I search through home depot a lot for American made over china made and a lot of the time the American made is cheaper and better. LOWES is filled with nothing but china made junk. kobalt used to be an awesome tool, now its just china made trash, quality is way down but they still want top dollar. it used to be made by snap on and very good. GOOD JOB ON THE VIDEO.
in the case of Harley Davidson they refuse to innovate and change with demand yet they asked for an import tariff to be imposed on the Japanese bikes back in the 80's. I'm all for helping American companies but sometimes they need to be allowed to fail as well. Harley hasn't changed the product that they make fundamentally at all but while people are buying big expensive adventure bikes, sport/performance bikes, economically inexpensive bikes, dirt/off road bikes, and so on; Harley remains a premium higher priced brand only making one type of product but had the balls to ask for bailout money in the recent recession! at what point does the market dictate what companies survive? Harley had a side brand "Buell" that actually was innovate and starting to make various types of product besides the typical cruiser but they shut the doors in the 2008 recession. so rather than expanding what Harley had to offer the customer or follow what the customer wants they did the opposite! just remember your voting with your dollars people.
love your videos keep them coming should I always buy American because I've always done that I try never to buy made in China tools even if I pay $0.10 more I always buy American is that a good thing
Wouldn't this mean that USA tools would eventually be the only tool on the market? Because it wouldn't be cost effective for foreign tools to sell in the US? And then when they are the only tool on the market they could raise the price to whatever they want and or whatever we the consumers are willing to pay...right or am I wrong? I can see where this can get expensive.
In simple terms, you're wrong. China and the US aren't the only countries in the world. We'll still have global competition from countries that don't artificially manipulate their currency like China does. Plus, you're still going to see plenty of cheap Chinese stuff. Just instead of a socket set at Harbor Freight being $8, it will be $10.
Maxwelhse but I thought tariffs are going to affect any non US item so any other country's importing tools would eventually no longer import into to the us because it wouldn't be cost effective, so again wouldn't that mean US tools would increase in price? Maybe until a second US tool comes out at a cheaper price. Right?
So far, Trump has only been specifically talking about tariffs on Chinese and Mexican goods, which is legitimately where the bulk of our trade problems lie. Right at this moment the Japanese, Germans, etc are already able to compete in the global market for premium tools and I don't think Trump is likely to chase after them since we already have fairly honest relationships with those nations.
So, my made in Germany Bosch 1/2" Jacobs to SDS chuck is still going to cost $40, but the Chinese one will be 20% (or whatever) more expensive.
Buy USA. That China made pipe wrench will not hold up. I use Ridge pipe wrench that were my grandfather when he was a tradesman and they are at last 40 plus years old and still work like new. And I can still buy replacement jaws for them. I personally bought two 36in Ridges to fit some 3in pipe and I had to use a 5ft cheater pipe on them the China's wrench would have just snapped.
Justin Stroup ha i used a 8 ft cheater bar those rigids man tough as a coffin nail
Ridgid has that iconic reputation with pipe wrenches but Milwaukee's have an unbeatable overbite all my Milwaukee tools are foreign made and hold up better than my USA tools
You forgot international shipping costs, which add quite a bit and offset some labor. Either way, buy USA.
Tariffs are an incredible bad thing. How about we lower regulations and taxes to increase competition?
shitty thing about tariffs it still cost you.
while I see creating American jobs is great, when there are major changes to taxes (standard or trade) there are going to be winners and losers. A tariff will help promote American Manufacturing it will also hurt American retail. let's take a company Like Home Depot if their profits went down buy something as small as 2% Home Depot will have to start cutting retail jobs and or hours to account for that loss. most large companies operate on small margins as it is. a trade tariffs will most definitely raise the cost of tools overall with higher costs typically will result in lower sales
What if the companies conspire and raise prices to all match and fake competition.....
Then new competitors will emerge and correct the market. No one is just going to sit out a cash cow operation like that.
Makes me nervous I at this time can't afford a saw made anywhere but say Taiwan. But I do like more work here though I always look for the made in the USA and will pay the extra penny lol.
I think "made in usa" is almost like a marketing premium now like putting a Nike swoosh on something, if there were more American manufacturers there would be more competition on the low end but the big wigs realize the low end customers don't have the luxury to worry where's it made and they can make more by having it made in China.
We don't need new changes!! New changes aren't going to make it any better! i just want to keep buy my tools as we are today! !
We need to worry about our own country first. When it comes to tools, everybody prefers USA made, but the imports like HF do provide a cheaper initial investment to new techs. Those options will still remain cheaper, even if the cost does go up a few bucks. However, with more good paying jobs in the USA, the American people will be able to afford to pay a little more too. You put somebody in a manufacturing job making $15 or more an hour, they can afford a lot more than if they could only get a job at Walmart or similar low paid non-skilled job. We've become obsessed with "stuff". Look at tablets for example.... Everybody wants a tablet, but their income working at Walmart might not support that $700 iPad. However, then can buy that Chinese version for $50. No, it's not a good tablet at all, but hey, it's stuff and now they have stuff. Quantity over quality is what we've become. That same person could get a job in manufacturing if the jobs came back and theoretically make double what they were at Walmart. Meaning, they can then afford the iPad. So perhaps in the long run there will be less demand for cheap Chinese made products.
in the case of Harley Davidson they refuse to innovate and change with demand yet they asked for an import tariff to be imposed on the Japanese bikes. I'm all for helping American companies but sometimes they need to be allowed to fail as well. Harley hasn't changed the product that they make fundamentally at all but while people are buying adventure bikes, sport/performance bikes, economically inexpensive bikes, dirt/off road bikes, and so on; Harley remains a premium higher priced brand only making one type of product but has the balls to ask for bailout money! at what point does the market dictate what companies survive?
that's all good explanation of tariffs. but it's only one side of it. as it was written earlier, it doesn't really matter where product coming from. if people who making it incompetent and don't want to optimize their production costs, their logistics and make right atmosphere at work place all USA products not gonna be high quality. simply because in USA history it happened already right after WW2. who wanted to buy USA made TV'S? nobody, but there was no competition. and when Japanese got USA marked opened up for them sales of USA made TV'S was so low, they had to close factories because product was made poorly and could not hold up for over than 2 years of use. doesn't seem as a good idea to go but new TV every other year. so they had to figure out how to make product that can stand competion. and because reputation of USA made product was at the bottom they have to drop prices also. all it said, that every country that have high taxes on import made them incompetent over a course of 5 years.
same with sports. if you would only take player in your professional team from one school or for that matter from 5 certain schools , do you think your pro team could ever win championship title?
Were oh were will the tariff funds go ????????????
+Richard O'connor the US treasury....the same place your income taxes go.
I recently was in the market for a tig welder and had a hard time finding a quality unit at a decent price. on one end you have a good quality miller that is claimed to be made in America but cost $4000 and comes with nothing extra. on the other end you have tons of China made machines that are a quarter of the price and questionable quality. I ended up getting one that came with everything you could possibly want for little over $3000 but made in Italy! now it makes me wonder why miller can't be competitive with a unit made in Italy? like the autoworkers unions, if your making $30 an hour and huge benefits to put a simple part in a car than you might be making more than your actually worth! $15 an hour to work in fast food? think again, you'll be ordering your burger from a kiosk. it IS possible to negotiate yourself right out of a job. maybe tariffs are a good start but it can't allow us Americans to just be lazy! sure Chinese labor rates are unfair but it's also true that American workers have been greedy in some industries and that helps to cause problems like we're seeing right now.
The Moto fixery what tig welder did u get? everlast seems to be pretty good
Mean Machine
I decided to go with the HTP Invertig 221. almost went with the everlast.