Monday, February 10, 2025

With tariffs consumer prices are likely to go up long before US industry is able to ramp up.

In the news now are tariffs on steel and aluminum. Tariffs slow down international trade and raise prices for consumers, but they could bring more customers back to American industry.

Will American consumers stand for this? Consumers are used to the abundance that global supply chains provide.

I doubt that US home based prosperity could come back quickly due to the time required in rebuilding local industries. Could tariffs bring back American Aluminum production, such as here in the Pacific Northwest?

Could this lead to the restoration of Alcoa (formerly Intalco) Aluminum works, here in Whatcom County? I am not holding my breath.

Edicts proclaimed by one moody person, the president, can rattle big corporations who seek long term predictable environments.

I think another way to re localize business is to consume less. This takes pressure off business giving it room to reform.

It helps to realize that consumer prices are likely to be higher; given more local supply chains. Wages and other business expenses tend to be higher, in USA, than in some other sweatshop countries. Product prices, from local production, are likely to go up relative to other prices; such as real estate prices in USA.

Below, pictures from my bicycle trips. 2024 powerlines near the currently shuttered Alminum mill in Whatcom County north of Bellingham. Two other photos from 2005 of an abandoned aluminum plant on the Washington side of Columbia River east of The Dalles, Oregon. If it's even still there, it wouldn't be easy to bring back into production, I'd guess.

No comments: