Does the fact that Trump's budget indicates US taxpayers will pay for the wall mean Mexico is not paying for it and President Trump lied?

You realise that literally all economists agree that tariffs are bad for a country (most of the time) and in actuality are taxes on the consumer right?. So Mexico isn't being taxed, but the American consumer is.

This is something that expert k ledge isn't required for. Imagine me and you both have separate companies that make sodas. Due to more efficient manufacturing techniques/cheaper labour laws in your jurisdiction etc. you can make them cheaper than i can, and thus undercut me on my price. Although i am worse off, the average person is significantly better off, as the reduction in cost in sodas is equivalent to an increase in real income.

Now imagine that the government taxes you 15% on every soda. Suddenly, your business is no longer profitable. You are forced to either raise prices, or go out of business. If you raise prices, although the government will be getting tax dollars from the tax applied, the real loser is the American consumer, who now has to pay more for their sodas, which is equivalent to a loss of income. The more likely scenario is that your business is no longer profitable at all, and my untaxed sodas are cheaper to produce than yours, meaning I can sell at my normal price, which is more expensive than your price before the tax came into play, so again, the loser is the American consumer, who has to pay more and thus is experiencing a loss in income due to the tax.

This scenario is broadly speaking why all economists agree tariffs, generally, are bad for the average consumer. In the scenario above, imagine your business was stationed in Mexico which allowed you to make cheaper sodas for whatever reason, but the tariff applied led to the American consumer losing.

/r/AskTrumpSupporters Thread Parent