When CEOs say if they have to pay taxes they’ll just raise prices instead of selling their 5th house people freak out.
When CEOs say they’ll just raise prices if their industry is regulated instead of lowering their multi million dollar salaries, people freak out.
But when they say the exact same thing with tariffs, everyone just goes along with it.
Its the same thing. Corporations shouldn’t be able to punish people to avoid making slightly less money.
If the teriffs burden exceeds the profit margin, which in most cases related to recent US discussion it does, if companies don’t raise prices they’ll be selling at a loss. No amount of corporate belt tightening can save you, even if there was an appetite for that, which there isn’t anyways.
Does the profit margin in your example include obscenely large executive salaries?
Yes. By the time those come down to a per-unit cost, they’re something for sure, but nowhere near as large of a factor of cost of materials.
Again, if we were talking a 5% cost increase in raw material input, then the ratio between additional unit cost of materials and unit cost executive salary would at least be closer. But we’re talking terriffs that are STARTING at 25% and god knows who’ll say the wrong thing to cause them to jump to 50 or 100.
As exorbitant as they are, you are probably underestimating the volume of production and so overestimating the per-unit cost of those salaries.
Ford, for example estimated a 25/10 teriff on steel/aluminum would add 1.6 billion to input costs in 2017. Now we’re looking at 25/25 so, I dunno, 2 billion per year (2025 dollars)
You could cut all executive pay at Ford to 0$ and you’ll still be in the red by like 1.8 billion.