I mean that just goes against the very basics of economics.. Adam Smith, comparative advantage - and goes against the failed history of protectionist policies. You're basically advocating a version of mercantilist theory in the 21st century.. it's incredible anachronistic. But it's hard to argue when you're dismissive of all models
But I'm glad you see that chips are not really the top priority if this was really an issue of national safety. So one then has to wonder what are the real drivers of these jingoistic policies
I may have dove down to many rabbit holes there, sorry if I did.
To wind it back a bit, are you disagreeing that with the idea that subsidies are meant to reduce consumer prices and tariffs are meant to increase prices on imported goods?
Or are you disagreeing with my argument that economics isn't that simply and pulling one lever can have multiple impacts that together may move prices in an unexpected way?
the first point is semantic, but sure. In effect a tariff functions as a subsidy for domestic companies. If it's a net income or expense is kind of irrelevant and matter of taxation or putting the expense on consumers...
To the second point... it's so vague to be meaningless. What you're advocating is basically mercantilism - which is widely seen as ineffective and counterproductive since.. the 19th century. "unexpected ways“ .. is it like the law of gravity and always going to hold? Probably not. But when you are talking about blocking international trade across whole sectors of the economy then it seems like a valid simplification. If you want to argue mercantilism is going to be a net benefit to the domestic economy then the onus is on the advocate of the outdated theory. All past historic experience points to the opposite and to the development of a stagnant backwards economy
Mercantilism is a top-down approach, I was never promoting that. My earlier comments specifically called out what may be possible if consumers prioritized domestic products, the government only came into the conversation when you raised concerns over subsidies.
With regards to subsidies and tariffs I disagree the distinction is semantic and unimportant, though it likely is irrelevant here since I started with the concept of a change in demand at the consumer level.
But I'm glad you see that chips are not really the top priority if this was really an issue of national safety. So one then has to wonder what are the real drivers of these jingoistic policies