Tariff Impacts You Might Not Have Considered

Apr 07, 2025

Welcome, fellow poor people. Well, if you’re part of the 62% of Americans who own stock either directly, or via mutual funds or retirement accounts, you lost scads last Thursday and Friday. Tons of details on stock ownership here.

You may have seen this, the official “equation” used by the regime to calculate reciprocal tariffs on individual countries:

Don’t get scared. It’s complete bulls**t. Not only that, but the reason that uninhabited islands, and “penguin islands1” were put on the list is because, and you should know this is coming, the lazy basta**s used AI to calculate the country list. Well, probably. Another take on AI usage is here.

If the Orange Menace’s people had actually wanted to look at the tariff rates, and define legitimate reciprocal tariffs, the “equation” would have been: “Country X charges a tariff of Y percent, and so we will charge them that.”

Instead, they decided to look at the trade deficit and screw around with the numbers.

The Madagascar Example

“Trade deficit” is a stupid way to look at things. Let’s take Madagascar. Their calculated tariff number is the base 10% plus 40% meaning 50%. Here’s the calculation:

U.S. total goods trade with Madagascar were $786.6 million in 2024. U.S. goods exports to Madagascar in 2024 were $53.4 million, down 13.2 percent ($8.1 million) from 2023. U.S. goods imports from Madagascar in 2024 were $733.2 million, up 1.7 percent ($12.0 million) from 2023. The U.S. goods trade deficit with Madagascar was $679.8 million in 2024, a 3.1 percent increase ($20.2 million) over 2023. Source.

What is the import duty to Madagascar? It depends. It ranges from 0% for countries with which there are agreements, up to 20% (a number reassessed annually). More math.

Therefore, the fascist tariff is TWO AND A HALF TIMES the charged rate, and for some US companies, the charged rate is actually zero, meaning the fascist tariff is to infinity and beyond2. (See the math link in the previous paragraph.)

Here are Madagascar’s overall top exports:

Nickel: US $836.2 million (25.9% of total exports)
Coffee, tea, spices: $548.7 million (17%)
Knit or crochet clothing, accessories: $256.8 million (8%)
Ores, slag, ash: $254.4 million (7.9%)
Clothing, accessories (not knit or crochet): $253 million (7.8%)
Gems, precious metals: $230.8 million (7.1%)
Fish: $135.3 million (4.2%)
Other base metals: $114.2 million (3.5%)
Salt, sulphur, stone, cement: $74.9 million (2.3%)
Mineral fuels including oil: $52.2 million (1.6%)

What is nickel used for? Primarily it’s a raw material for stainless steel (which, when finished, incurs an additional tariff), and less commonly for industrial applications, such as an ingredient in EV car batteries.

The second line includes “spices”, which for a lot of the world, means “Madagascar vanilla”3. Madagascar grows and distributes 80% of the world’s vanilla. Vanilla comes from an orchid, which has very specific climate and pollination requirements. Then, there is a months long process from flower to ready-to-ship. Whole process here.

Why do I bring this up? Just to show the problem with the math4, and to show the insanity of the whole process. But wait, there’s more.

Let’s Talk Food

The US imports a lot of food. And that means FOOD: fruits, vegetables, beef, chicken, seafood, you know, ACTUAL FOOD.

The US would like to export a lot of its food, but there’s a problem. Most of the world won’t take US food, because while Americans grow and farm FOOD, we are committed to corporate bastardization of food.

Here are some of the things the rest of the world won’t accept, and the additives that make our “food” unacceptable:

Beef: pre-packaged ground beef has “pink slime” which lowers fat content. How do they do it? Ammonia gas. Plus all the hormones fed to the cows.
Chicken: lots of American chicken is fed arsenic (to make it pinker) and then treated with chlorine to kill microorganisms. Not to mention the antibiotics.
Pork: treated with ractopamine, a beta-agonist that’s used to increase protein synthesis.
Bread: potassium bromate is used to speed up the baking process.

Those are just a few of the “foods” that the rest of the world won’t accept. Here are more. And remember, lot of Americans eat this stuff without thinking about it.

Don’t get me wrong: we export a lot of soybeans and corn and other crops. Note that many of our crops are grown with Monsanto GMO seeds, which include in the seed, weedkiller resistance, and their own insecticide. One example. And thanks to the LAST Orange Menace tariffs, Brazil now exports more soybeans worldwide than the US. Albeit, Brazil began to overtake the US earlier, mostly due to no Monsanto, but the growth accelerated under the first term. Cool charts here.

Here’s your takeaway: everyone needs to eat every day. The less food costs, the more people can afford to eat. It’s why dwarf wheat is so remarkable - it can be grown in many more locations that standard wheat, cheaply, and thus can feed more people. Tariffs make food more expensive. People will starve.

Let’s Pretend the US Builds Factories

Last September, I wrote the post Let’s Talk Tariffs, which included charts about the cost of making tee shirts in New Jersey, China, Bangladesh and Vietnam. The initial chart is below, and if you click over to the full article, you can see the impact of tariffs on the total cost of tee shirts, which I had guestimated in September as 60% on China, and 20% on Bangladesh and Vietnam.

Bottom line, EVEN WITH THE TARIFFS, it will still be cheaper to produce tee shirts outside the US. Even if the US builds factories.

But let’s pretend that the US can build factories. US factories for many products make things cost MORE and don’t appreciably increase employment.

I’ll say that again:

US factories for many products make things cost MORE and don’t appreciably increase employment.

Take something like an iPhone5. The current cost of an iPhone 16 Pro (256GB version) is $1,100. The cost of components is likely in the range of $550. Add in the cost of assembly, testing, marketing, and profit, and you get to the $1,100. That $550 base cost rises to $850 with the new tariffs. Different people have pegged the new cost to US consumers at $2,000 - $2,200 in round numbers.

So let’s say you want to build iPhones in the US. First, you need to stand up factories either to build the components (processor, display, batter, modem, memory, storage, camera array, etc.) AND the assembly and testing, OR only undertake the assembly and testing.

Apple would need to find the land, ensure the correct zoning, purchase the land, undertake the infrastructure, and then build the actual factory or factories. And remember, if you are manufacturing semiconductors for the processors, you need very specialized equipment (which we don’t manufacture in the US). That would cost them at least millions of dollars, which would, of course, factor into the cost of an iPhone.

Now, let’s talk employment. Whatever it costs for labour in China (where Apple manufactures now), the US cost would be TEN TIMES as much, given our minimum wage structure.

BUT

First, these are not minimum wage jobs, because skills are required. Thus, add training time to the timeline. Second, a lot of the manufacturing (of iPhones and everything else) is far less labour-intensive than it used to be because robots.

China is at the forefront of what is known as “dark factories”. These are places where all the work is accomplished by AI-run robots. There is no need for lighting. The only humans are those that walk around and make sure that all the machines are running correctly. Lights come on automatically when a human enters a room, and turn off when the person leaves. It is how factories will be built in the future. It will become the norm not just for tech products, like cell phones, but almost everything else, too.

So while those new factories that Shitler wants might actually be built, they will make money for the companies and their stockholders, they will not create the kinds of good paying jobs for which people are clamoring.

As an example that would require labour, take wedding dresses. These garments require a ton of hand work at sewing machines. They are more complex to sew than, say, tee shirts. There’s nowhere in the US that has a factory that can make wedding dresses, and there are very few people who know how to sew them6. So you’d not only need to build factories, and either manufacture or import actual sewing machines, but train people to sew, and then pay them wages at least ten times what labour costs in Asia.

Why There Will NOT be New US Factories

From the last section, we know that investing in new factories is time consuming. To build them, companies need assurances that, once built, the factories will be used and will be able to turn out goods at prices that are competitive with tariffed imports. More importantly, they need to be sure the tariffs will hold, and are not simply a negotiating tactic. This creates uncertainty, and businesses (and the stock market) HATE uncertainty, and take a “do nothing” stance until they have some surety. The Convicted Felon has spoken out of both sides of his mouth saying that the tariffs are here to stay, as well as indicating he’ll negotiate. So those factories will never get off the ground.

Now you know.

Jessica’s Substack

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