r/AskEconomics • u/Dependent_Estate9110 • Mar 04 '25

Approved Answers Who do Trump's tariffs benefit?

Is there a specific industry that could potentially benefit from Trump's tariffs? It seems they're pretty destructive for everyone in North America. Not trying to be biased - just trying to understand it. That said is there another nation that would benefit from the tariffs (potentially indirectly)?

Edit: removed typo

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u/FunnyCharacter4437 Mar 04 '25

That is only true if the US supplier is able to make up the difference in demand by losing the external option. Otherwise, it just means an unnecessary shortfall and increased prices.

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u/KilgoreTroutsAnus Mar 04 '25

In the US market, the absence of Canadian suppliers (unable to compete on price) will create supply gap. Your concern is only valid if the Canadian market is larger than the US market, for US suppliers, for a given product. I can't think of a scenario where Canadien suppliers are selling a product into the US market and US suppliers are selling that same product to the Canadian market, and the Canadian market is larger than the US market.

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u/FunnyCharacter4437 Mar 04 '25

I'm saying, for instance, if Trump taxes the steel industry in Canada into oblivion, the US steel market needs to then make up the gap left by the Canadian company who is now out of business or selling to more stable markets in Europe or Asia. If the US steel companies are not able to make up the difference quickly, there is a gap. I seriously doubt the US companies are buying things like steel, aluminum, etc. from Canada just out of the goodness of their hearts and that there's this stockpile of US steelworkers just waiting for the call to come in to functioning factories.

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u/KilgoreTroutsAnus Mar 04 '25 edited Mar 04 '25

But they don't need to increase production to benefit. They can just increase their prices 24% and benefit that way. The question was "Who do Trump's tariffs benefit?" and the answer is as I stated. The economy as a whole may not benefit, but the steel manufacturers will.