I’ve been thinking about washing machines.
Once luxuries, these appliances are standard fixtures in
most households. I remember my first washing machine and the pure joy that came
with knowing I would no longer have to hunt for quarters or wait for an empty
machine in the laundromat. These days, we think of these machines as part of a
pair—washing machine AND dryer. Because who has time for clothesline drying?
And who wants their wet unmentionables flapping in the breeze?
In 2016, 80% of the washing machines imported into the US
came from China. Chinese washing machines cast a wet blanket over US washer
production, leading the Obama administration to impose protective tariffs on
the item. The tariffs were specific to Chinese-produced machines, so they just
moved to Vietnam and Thailand. We continued the spin cycle with little effect
on consumers.
But in 2018, the Trump administration put all foreign
machines in hot water, instituting tariffs on imported washers, regardless of
the country of origin. Now, I’m not a fan of protective tariffs, and we never seem
to learn our lesson on them. It’s like putting that red pair of underwear in
your load of whites. Pink is going to get on everything, and we’ll all suffer.
The latest tariffs on washing machines resulted in higher
prices to consumers, 12% higher. That means a $500 washer now costs $560, on
average. While foreign companies pay the tariff to our treasury, they make sure
their cost is covered by raising the price on the item in question. The idea
behind a protective tariff is to protect US jobs. In this case, some of those
appliance manufacturing jobs did reappear, but at what cost? Are we all paying 12%
more for clean clothes just to get a 1% benefit on manufacturing jobs?
Strange thing about those washing machine tariffs… dryers
were exempt. The washers’ twin was not burdened with the extra tax of a tariff,
but that didn’t stop companies from raising the price of dryers 12%, as well.
Now that burns me up!
Every country is trying to load the system in their favor,
but competing tariffs often lead to an off-balance market that just costs
consumers. This time around, each new job created by the tariffs cost $817,000.
That’s a lot of dirty laundry!
