The Biden administration is poised to unveil new tariffs on imported Chinese electric vehicles, creating a potential roadblock for Chinese automakers wanting to expand into the American market.
While I can’t say any of this is wrong, you’re missing likely the single biggest component inflating the cost of US manufacturing: profit margins. Every step of the supply chain has a profit margin attached. Sometimes just a few percent, but often double digits. These compound, so a 5% margin on a simple component will see an additional 15% when sold as part of an assembly, which is then marked up another 20% when sold as part of the finished good. There’s also financialization which burdens US companies. Companies generally need to take loans to fund their operations, and end up having to pay heavy interest fees and rent which also drives up cost. Workers and environmental protections are more expensive, but in practice they are relatively minor compared to a lot of other inefficiencies US industry struggles with.
Doesn’t the USA have much higher wealth inequality than China’s? If so, is that not the result of corruption? If not, so you consider the visible symptoms of it?
While I can’t say any of this is wrong, you’re missing likely the single biggest component inflating the cost of US manufacturing: profit margins. Every step of the supply chain has a profit margin attached. Sometimes just a few percent, but often double digits. These compound, so a 5% margin on a simple component will see an additional 15% when sold as part of an assembly, which is then marked up another 20% when sold as part of the finished good. There’s also financialization which burdens US companies. Companies generally need to take loans to fund their operations, and end up having to pay heavy interest fees and rent which also drives up cost. Workers and environmental protections are more expensive, but in practice they are relatively minor compared to a lot of other inefficiencies US industry struggles with.
That’s true in China as well. The only difference is in the price of what is being marked up.
Well, there’s also less corruption and more free competition to lower pricesin the US.
Bless your heart, sweet summer child.
You think there’s more corruption in the US government than the CCP? That China’s market is more free? Give me a break.
Doesn’t the USA have much higher wealth inequality than China’s? If so, is that not the result of corruption? If not, so you consider the visible symptoms of it?
As I said, I’m talking about the US gov vs Chinese gov.