Cost increases from onshoring are more than wage increases from onshoring.
There is no problem with trade deficits. Countries accumulating USD means they have to lend it back at cheaper and cheaper rates.
The real problem is the federal deficit. In 2024 the USA had to borrow $2 trillion to keep the lights on, while foreign countries only had $1 trillion from net trade deficit to lend.
By analogy, the problem isn't that the USA is buying discount goods, it's that it's funding its lifestyle with a credit card. Paying more for the goods and still using a credit card doesn't solve this problem. It makes it worse
If the goal is to plug the budget issue, you want imports to continue so that you can extract more tax from the citizens.
Even then, quality of life is less impacted if you just raise general taxes like a VAT or sales tax. That way consumers still get the best bang for their buck.
What is the upside from the tariffs?
Cost increases from onshoring are more than wage increases from onshoring.
There is no problem with trade deficits. Countries accumulating USD means they have to lend it back at cheaper and cheaper rates.
The real problem is the federal deficit. In 2024 the USA had to borrow $2 trillion to keep the lights on, while foreign countries only had $1 trillion from net trade deficit to lend.
By analogy, the problem isn't that the USA is buying discount goods, it's that it's funding its lifestyle with a credit card. Paying more for the goods and still using a credit card doesn't solve this problem. It makes it worse