When DHL delivered mail to Adafruit Industries last week, it wasn’t a typical invoice but a gut punch: a $36,126.46 customs duty bill that had to be paid within seven days.
The bill comes from Trump’s multi-layered tariffs that can stack up to 170% on certain electronics components. For Adafruit, a company that supplies makers and engineers with specialized electronic parts, this creates a perfect storm.
These components were ordered months ago before tariff changes, can’t be sourced elsewhere due to intellectual property restrictions, and must be paid for immediately — not after sales are made.
Here’s the rub, and you said it: The tariffs may not last and our politics come in 4-year intervals. Who in their right mind is going to build factories here given the outrageous risk?
Also, not sure what you’re on about with America not being able to defend itself? Chinese rare earth export bans?
Most people didn’t see it during covid, but even a lot of stuff that was “made in America” basically became unobtainable for a long time afterwards, particularly on the industrial front. If the precursors of most things they do make come from China, then it doesn’t matter what America or the west in general makes because for example it becomes difficult to get electronics components like resistors, but also they’ve basically become the place to go to get molds for plastic manufacturing.
The trade war is just a taste of what that would be like, and adafruit is just one of the casualties.
The fact that it’s going to be hard to make a change I think doesn’t justify doing nothing. You have to at least try, because maybe you fail but maybe the next administration besides that that wasn’t such a bad idea after all and keeps some of those policies in place, the same way that the Biden administration had kept tariffs against China in place.
It’s a two-way street here, yes to an extent there is additional risk from building factories in a country where tariffs are rising, but on the other hand if you are not building your things in America then there’s a chance that you end up getting priced out of the market. I’ve already written more than most people on the tariffs, but protectionist tariff policy goes all the way back to Alexander Hamilton in the 1700s.
Grateful you’ve written all this, and I read every word and upvoted every post.
If you’re not American, you sure know our history!
Maybe I missed it, but again, give out fluctuating politics, why would anyone build factories here? If we had a hard line on tariffs, were willing to eat the short term pain, and stuck with it, I can see results. Looking at it from a capitalist’s point of view, all I see is wild risk, better to hold my cards for now.
Honestly, I gotta take my licks at the moment, since it looks like the US is relenting particularly with China.
So yeah, it’s a couple months of pain for a slightly better(?) tariff deal, but that’s not transformative. It isn’t going to work like the 1800s to actually build a whole infrastructure.
If things were done like back then, it would hurt in the short and long term but the US would come out stronger for it. Instead it was just some volatility and some mild trade concessions.