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Tariffs are causing a freeze on hiring and expansion plans.


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Easy to win, so much winning.  This guy is going to try letting the machines run for 4 hours by themselves...

 

https://www.nytimes.com/2018/07/05/business/economy/trade-war-impact.html

 

With tariffs driving up the price of stainless steel, the precision-part manufacturer Accu-Swiss in Oakdale, Calif., came up with a plan to save money: turn off the lights but keep the machines on.

“We are being hurt because of the cost increase,” said Sohel Sareshwala, the company’s owner and president. To squeeze more output from existing equipment, he is “running the machines in a lights-out operation.” After his regular 10-person staff leaves for the day at 6 p.m., Mr. Sareshwala said, the plant is experimenting with slowing down the machines and letting them run unattended for four more hours.

 

Accu-Swiss doesn’t use imported steel, but the tariffs have ratcheted up the demand for domestic steel, making it harder to find and afford. So far, Mr. Sareshwala said, his priority is delivering orders on time, regardless of the cost.

 

Edward Farrer, director of purchasing at Principal Manufacturing in Broadview, Ill., which produces automobile parts, has felt the same effect. His company, which employs 330 people and has $50 million in annual sales, is a purchaser of imported steel and has not been able to find a domestic alternative.

Even if one emerges, he said, “the tariffs have been a springboard for domestic producers to increase their price” — and those higher costs will put American companies like his at a disadvantage compared with foreign manufacturers. Moreover, he said, any change in Principal’s suppliers would require customer approval, an exhaustive process that would cause significant delays.

 

Mr. Trump has promised that the tariffs will protect jobs in the steel and aluminum industries (as well as safeguard national security). Several manufacturers, however, said they were skeptical that domestic steel and aluminum makers had the capacity to meet the increased demand any time soon, and worried that prices would continue to rise — and even threaten jobs at their own companies. Mr. Farrer has halted all hiring, leaving about 30 positions unfilled, and has canceled, at least for now, a major capital purchase, two large machine tools.

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This may be no great revelation, but I think we're seeing the flawed calculations of Trump and other world leaders explode here.

 

For a long time we got the embarrassing spectacle of people like Truduea, Macron, and Merkle buddying up to Trump. Trying to take advantage of that narrative that Trump is a child that can be swayed by telling him how great he is.

 

Which I think is true, up to a point. But they found out it's not enough to stop Trump from what he really wants to do.

 

So the other leaders sucked up to him to prevent this exact thing. Trump saw it as a weakness, and he did what Trump always does. Keep pushing further until someone makes him stop. He expected the others to back down because they already showed weakness, but Trump has shown a staggering amount of failure to understand that when you exhaust all your leverage, the other guy is going to hit back when they have nothing left to lose.

 

If Trump were in a human shield stand off, he would shoot the hostage immediately and then be surprised that the police rushed in and arrested him instead of being quelled by his show of strength.

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