Comment by kranke155
Comment by kranke155 2 days ago
Tariffs and protectionist policies are unfairly maligned. They are effectively the only way countries build and rebuild industries. The idea that they are bad is an invention of bad economists who don't study history. See the book "How Asia Works" for an accurate economic history of the growth of industrial power in Asia, how it was based on Germany's ascension before it, and how it was al built on the RIGHT kind of policies. https://www.gatesnotes.com/How-Asia-Works
Successful Asian powers studied history, not Milton Friedman. https://en.wikipedia.org/wiki/Historical_school_of_economics
Tariffs that merely offset subsidies in the other country has zero net effect on competition, and doesn't harm producers on either side unduely.
The net effect is merely a net transfer from the foreign government to the domestic one.
Tariffs that go BEYOND the subsidies in the foreign country has a net protectionist effect. This CAN cause stagnation in the industry in question. But less so if there is still healthy domestic competition.
Subsidies are potentially the most destructive measure. This is especially true for protectionist subsidies, and less so for export subsidies. But in general, subsides sets up a cash transfer facility between a government and local industry, often removing incentives to innovate. In turn, this means that the subsidies need to increase year by year to have the desired effect.
This can lead to the subsidized industry dying a sudden death once public patience for the growing subisides (and so the subisides themselves) come to an end.