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US/China Trade War

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This topic contains 11 replies, has 8 voices, and was last updated by  bvandewalker 1 week ago.

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  • #1390778

    hobbyhub
    Participant
    1694xp

    Hi All,

    With the trade war between the US and China heating up (and no, I’m not looking for a game to simulate this particular battle), it looks like our geeky/nerdy pursuits are in the firing line….

    As per ICv2:

    “Multiple game categories, books, and magazines were targeted in the latest round of tariffs of up to 25% on imports from China announced by the Trump administration on Friday.  The tariffs will affect geek categories including board, card, miniature, and roleplaying games; comics and graphic novels; and toys.

    For companies that use Chinese manufacturing to produce products sold in the U.S., a 25% increase in costs will require some hard decisions about sourcing, pricing, profit margins, and product design.  Higher retail prices would likely follow.”
    I’m presuming that this won’t only hit retail goods coming via the US but crowdfunded items as well….

    I wonder if that will include GW goods that are manufactured in China rather than the UK, as the wording of the article seems to infer that….

    #1390779

    warzan
    Keymaster
    16700xp

    Watching this with interest. Certainly a big game of brinkmanship going on that’s for sure.

    There is never a good time for this kind of action to be taken and I really hope both sides sort it out, as I dont know who the winners will be but is suspect the losers will be the same as always… us!

    #1390811

    robert
    Participant
    4361xp

    The only winner from a trade war is misery and lost opportunity.  You really would have thought we would learn from the past, and the fact that the Great Depression was prolonged and exacerbated due to a trade war, and it basically took a military war to drag us out of that.  I’m pretty sure it was Adam Smith in 1776 who showed that trade benefits everyone (or he was at least the first person to write it down and give the concept a name).

    @hobbyhub You’d be correct on your point about GW products manufactured in China.  It would be interesting to see what the current level of tariffs are on these products between the US and China, because if they were sitting at 20% then they haven’t interested by much, but if they are currently at 5% then that is a massive increase.

    #1390813

    blinky465
    Participant
    5058xp

    I’m pretty sure it will – it’s not tariffs on US-designed goods, but Chinese manufactured.

    The idea of tariffs is to dissuade people from sourcing from one country, and to encourage manufacturing/production in another; it’d be a pretty weak political tool if there were caveats, such as “well, it was designed ten years ago by a company in a different country, so should be exempt”.

    For over a decade we’ve been on the brink of a “cottage-industry” style revolution – with people and companies having access to the machinery and equipment to produce much closer to source (3d printers, laser cutters, resin printers etc). It never quite arrived, because it’s the relatively high labour costs that has made it cheaper to still have products manufactured on the other side of the world then shipped to the final destination (despite the environmental impact).

    Many people will simply look to alternative “developing” nations for manufacturing; forward thinking companies – irrespective of tariffs – with a 5-10 year plan should be looking ahead to future possible tariffs designed to offset the environmental cost of doing global business.

    Personally, I’d like to see more people embracing the digital-as-a-product idea that DriveThruRPG has done so well for many years – buy the IP and the right to produce the product closer to the end user (it could be a local company, if the end-user doesn’t have the facilities to produce final goods themselves).

    Tariffs are a blunt instrument with lots of unintended consequences. They are harmful in that the end user price can only go up. Very often they simply force business to change their supply chain; it’d be great if they might actually change the way we do business….

    #1390962

    totsuzenheni
    Participant
    1393xp

    As someone who avoids buying goods made in China as much as possible for ethical reasons, it isn’t necessarily a bad thing in that respect that the cost of goods made in China will go up.

    • This reply was modified 1 week, 4 days ago by  totsuzenheni.
    #1391148

    bvandewalker
    Participant
    808xp

    Personally I think this is probably a tempest in a teapot for 3 reasons:

    1: It probably won’t really effect mini makers that much since the big market for minis is actually the UK and to a lesser extant the EU, they can just send them directly there (This blog/forum is mostly done by UKers for UKers, when WGF a Chinese tooling company had a public forum a good chunk of those folks where UKers, mantic and GW along with most of the other big players are UK companies along with their preferred mill, when you don’t have UK friendly shipping for your plastic mini KS it tends to die, etc).

    2: printing card broad components should be do able in the USA (if it isn’t already happening), and if there is a demand for “special” printers  that are not in the US, I believe we still have the companies and factories capable of building them the only issue might be the individual parts, but that’s what machine shops and 3D printers are for (and I know we have both of those).

    3: Finally the ball hasn’t even dropped yet and it is possible, that either China will cave or congress and the executive branch will reconsider after talking about big business.  The tabletop, toy, and general hobby markets are the small fries in this power play, I would be more interested in what the bigger markets like smartphones makers are doing. Besides China is kinda of unstable right they can’t really afford to play chicken.

    And I could be totally wrong about this but I think most companies and people who are working with Chinese on KS for gaming have had some advanced warning of this, just judging  by the KS costs and shipping of the ones for plastics I have been backing.

    P.S.: Nobody is going drop nukes over the plastic trade, (if they didn’t drop them it over Vietnam or the cold war,  they are not going to do it over plastic, and all the groups that actually have nukes are too scared to actually use them even when they probably should, those bombs are just glorified bargaining chips on the geopolitical poker table). Oh and the great depression at least for the USA was extend by FDR’s New Deal policies very clearly, not a trade war or isolationism (though I doubt those helped any lol).

    • This reply was modified 1 week, 4 days ago by  bvandewalker.
    #1391157

    robert
    Participant
    4361xp

    @bvandewalker the Trade War started by Smoot and Hawley was the major factor in the fall of trade between America and the rest of the world in the 1930s.  As far as I can remember, US exports and imports fell by about 50%.   Most economists would agree that it was a major contributing factor in increasing the severity of the Great Depression (and it is probably one of the few things about the Great Depression they do agree on).

    As a follow up to my earlier post, it was David Riccardo who actually came up with the concept of Comparative and Absolute advantage, but Adam Smith did allude to it in The Wealth of Nations, so I was wrong in my earlier comment.  Also as far as I can ascertain there is currently no tariffs on scale models and games so this would be an immediate 25% increase in cost at the US boarder.

    #1391196

    elessar2590
    Participant
    6766xp

    There’s way too many causes for the Great Depression to start picking one or two.

    Most Economists do not agree it was a major contributing factor. At best it was fuel on the raging bonfire but it didn’t have a massive impact.

    “the view held by prominent economists, ranging from University of Chicago Nobel laureate Robert Lucas and Yale economist Robert Shiller to MIT economists Rudiger Dornbush and Stanley Fischer, is that since the foreign-trade sector was only about 7 percent of gross national product (GNP), the tariff (though misguided) could not explain much of this decline.”

    That comes from the Foundation for Economic Education which was supported by Mises and Hayek so hardly a pro-Tariff Organisation.

    https://fee.org/articles/the-smoot-hawley-tariff-and-the-great-depression/

    #1391230

    robert
    Participant
    4361xp

    First, who is picking causes of the Great Depression?   It is a commonly held view amongst economists that the Smoot and Hawley tariffs did contribute to the severity of the Great Depression, and I only say that as someone who studied economics for 6 years of his life, and was employed briefly a research assistant in an university’s economic department, albeit it was 22 years ago.

    Did you actually read that article you pulled the quote from?  It is basically saying that the economists you have quoted are wrong and severely underestimating the impact Smoot and Hawley had.

    #1391234

    elessar2590
    Participant
    6766xp

    @robert apologies.

    That’s what I get for skimming the article on the train.

    • This reply was modified 1 week, 3 days ago by  elessar2590.
    #1392312

    ced1106
    Participant
    965xp

    From Reddit: “I am a licensed Customs Broker in the US. I literally deal with these tariffs ALL day long. People sit here and complain that “Well a 25% price increase is going to kill businesses”.

    Here is some news for you to get a better perspective on this situation: So let’s say a game publisher has a game with an MSRP of $60.00. The actual cost they declare to Customs is around $8-$11, on average. The rest of the cost goes to paying for things like ocean freight charges (which are non-dutiable and thus, the tariffs do not impact), and warehousing and trucking and profit and labor costs and other local charges, none of which are dutiable and thus the tariffs do not affect. That means, on a game that has an import cost of $8.00, the tariff adds $2 to the price of importation of that copy of the game. $2 to a $60 game is a total increase of 3.33%. That sort of cost can be absorbed with barely any notice to the consumer.

    And if you think I making things up, these tariffs have been in place for virtually everything from China since September. How many things have you noticed huge cost hikes on? Anything that jumped 25%? Any small businesses that were thriving prior to Sep 4 that are now out of business? Most people here seem to think of this like a VAT, or a Value Added Tax, which is a flat tax added at the time of sales tax, which means you are taxed on all the freight and trucking and warehousing and whatever charges. That is not how tariffs work. So that $95 copy of Gloomhaven, were it imported from China after these tariffs, would (assuming the cost was fully passed on) cost about $98-100. Again, not a 25% cost increase. And the reality of this is that the additional tariffs they take in from China and a few other countries help offset the ridiculous runaway spending that Congress does so that it offsets some of the money we end up borrowing from China to pay for their nonsense.”

    Board games are about to be hit with a 25% tariff. What happens next? from boardgames

    #1392499

    bvandewalker
    Participant
    808xp

    I was going to go into a long comment but I think ced1106 comment just curb-stomped “Oh,no not a tariff!” and “this trade war’s going to cause an end to hobby gaming market!”  commenters in a way that  I couldn’t (if the tariffs on China comes down to a maximum $0.05 to every to every $0.95 and have been in place since September last year  with out the general populace/ gaming community at large noticing then this isn’t even news or a real worry and BoW should probably consider apologizing for spreading fear and panic  messages that can mess up KS projects).

    So instead of that  did you guys know that the Fordney-McCumber tariff actually boosted the US’s economy? or that all sorts of bad thing happened at once in the great depression due to banker shenanigans and WW1 recovery? That the Smoot tariff was just congress trying to fix things and just failing?

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