How protection kills innovation in the protected environment!

[WillyAp]

The economist nailed it  (again)
An article well worth to be read entirely:

Cheerleaders of tariffs argue that, as Oren Cass, one of the most vocal, put it, “Behind some of the world’s highest tariff barriers, the United States transformed from colonial backwater to continent-spanning industrial colossus.” They claim that Thomas Jefferson’s trade embargo in 1807, followed by the war of 1812 with Britain, jump-started American industrialisation.
Not so. America’s early industrial gains owed far more to pirated British technology and welcoming European talent than to protectionism. Though the embargo indeed encouraged the rise of small-scale textile mills, trade restrictions ensured these were persistently inefficient. These mills collapsed once trade resumed because they could not compete with superior British imports. The real drivers of New England’s textile revolution were people who brought skills learned abroad, such as Samuel Slater, an immigrant from Britain who memorised the country’s textile-machinery designs and established America’s first cotton mills, and Francis Cabot Lowell, who secretly replicated British power-loom technology. Waves of European craftsmen and engineers brought expertise that propelled the country’s 19th-century boom.

No paywall: https://archive.ph/BArHX

https://www.economist.com/by-invitation/2025/05/27/want-to-destroy-american-business-protect-it-writes-carl-benedikt-frey

The situation is not that new. The Car industry went through that in the 80 last century. Only thing left is innovation. As Mr Key phrases it: Tariffs kill innovation.
Most 3rd world countries try to protect their industries.
 
Globalization came and those industries were noch prepared. Nestle bought up many cacao productions. The big 4 of the automotive sector convinced governments to close borders to used car importation. In exchange they got car assembly units set up. Something to show the people.  

Now the big 4 need protection from their own president.

[el kaka22]

Honestly, other nations will end up selling and getting better to other nations, whereas USA will end up staying behind, because if others can't sell to USA, you think they will just keep getting American products?

If Hyundai can't sell to USA, you think Ford could sell to them? Of course not, and that would cause so much problems. And this is terrible for small business but even worse for big ones. Think of it, 100 million dollars spent by some big company to get something, could become 150 million with new tariffs, how are they not going to make the product sold for more? They will. Apple for example is the biggest one and that should be giving you enough example that none of these will mean anything in the end.

[WillyAp]

Honestly, other nations will end up selling and getting better to other nations, whereas USA will end up staying behind, because if others can't sell to USA, you think they will just keep getting American products?

The tariffs will enhance corporation. Still most tariffs are in place in the 3rd world.
To bring a car to Venezuela you pay over 25% of the book value.

[Yokkattannee]

Honestly, other nations will end up selling and getting better to other nations, whereas USA will end up staying behind, because if others can't sell to USA, you think they will just keep getting American products?

If Hyundai can't sell to USA, you think Ford could sell to them? Of course not, and that would cause so much problems. And this is terrible for small business but even worse for big ones. Think of it, 100 million dollars spent by some big company to get something, could become 150 million with new tariffs, how are they not going to make the product sold for more? They will. Apple for example is the biggest one and that should be giving you enough example that none of these will mean anything in the end.

all because there is a thought about increasing state income, that's what they think and the US tariffs are heading the other way around, of course it will have an impact on the country, and the companies behind it will spend more capital, of course in return they will sell at a high price, and make goods more expensive and hinder economic growth and that's what happens, and in the US itself there will be many losses in the long term because investment will decrease because trade is unstable.

[Fortify]

The economist nailed it  (again)
An article well worth to be read entirely:

Cheerleaders of tariffs argue that, as Oren Cass, one of the most vocal, put it, “Behind some of the world’s highest tariff barriers, the United States transformed from colonial backwater to continent-spanning industrial colossus.” They claim that Thomas Jefferson’s trade embargo in 1807, followed by the war of 1812 with Britain, jump-started American industrialisation.
Not so. America’s early industrial gains owed far more to pirated British technology and welcoming European talent than to protectionism. Though the embargo indeed encouraged the rise of small-scale textile mills, trade restrictions ensured these were persistently inefficient. These mills collapsed once trade resumed because they could not compete with superior British imports. The real drivers of New England’s textile revolution were people who brought skills learned abroad, such as Samuel Slater, an immigrant from Britain who memorised the country’s textile-machinery designs and established America’s first cotton mills, and Francis Cabot Lowell, who secretly replicated British power-loom technology. Waves of European craftsmen and engineers brought expertise that propelled the country’s 19th-century boom.

No paywall: https://archive.ph/BArHX

https://www.economist.com/by-invitation/2025/05/27/want-to-destroy-american-business-protect-it-writes-carl-benedikt-frey

The situation is not that new. The Car industry went through that in the 80 last century. Only thing left is innovation. As Mr Key phrases it: Tariffs kill innovation.
Most 3rd world countries try to protect their industries.
 
Globalization came and those industries were noch prepared. Nestle bought up many cacao productions. The big 4 of the automotive sector convinced governments to close borders to used car importation. In exchange they got car assembly units set up. Something to show the people. 

Now the big 4 need protection from their own president.

It's a good observation - America has traditionally being a nation that has forced other countries to strip back their protectionist tendencies in order to access their internal market. Many countries have made this trade off because the American consumer is one of the richest and most prolific spenders in the world. However we are currently stuck with a President who has throw away decades of successful economic policies in order to try and make the USA introverted once more, it is a losing strategy. I could understand if he was upset with and targeted certain foreign industries that might receive manipulative subsidies, but to throw out blanket tariffs shows a distinct lack of political skill or economic understanding that is going to backfire spectacularly on the average American. Unfortunately though, he will suffer no consequences as the corruption he basks in will keep his family rich for a very long time.

[peter0425]

Honestly, other nations will end up selling and getting better to other nations, whereas USA will end up staying behind, because if others can't sell to USA, you think they will just keep getting American products?

The tariffs will enhance corporation. Still most tariffs are in place in the 3rd world.
To bring a car to Venezuela you pay over 25% of the book value.

China among other countries also has huge tariffs and they are not a third world country. America placed tariffs those who seems to be their competitors. In fact many third world countries are the ones with lower tariffs so people expect other countries to operate on those countries instead. But anyway they are saying these tariffs are illegal so will it get removed? Maybe.

[WillyAp]

. But anyway they are saying these tariffs are illegal so will it get removed? Maybe.

Its is pretty clear that tariffs are not doing what is expected.
Re-creating those supply chains from 30 to 40 years back is futile at best.

Its dreamwork Trump and it won't happen. Many industries can't even produce the materials needed due to environmental concerns.
There is only one thing left the US has in favor. And here the government can do a lot. Not just at Harvard.
In the end the diversity is just a circus, Bread and & Circus as the roman said.

[pooya87]

It has some points in it but comparing 2025 with 1800's is just silly. 2 centuries ago the colonizers were ruling and technology was not something one could acquire easily.  In this day and age the same colonizers spend billions on a technology like AI for instance and then China suddenly puts DeepSeek on the table that costed only a tiny fraction of that to develop.

It's the same everywhere else too. The other day I was reading something about a new radiopharmaceuticals that is under R&D in only two countries (Germany and US) meanwhile Iran has already broken through R&D phase and is now producing it for the markets at dirt cheap prices.

The problem is neither innovation, nor tariffs. The system itself is broken. The "colonizer" system that was designed to steal from everyone else and attack them to keep them behind is only going to work for so long before it can't be used anymore... this is the downfall of that short lived empire...

[uchegod-21]

Every given article released on the National or international level is either intended to teach, exploit, manipulate or to persuade. If I want to exploit your God's given natural resources as a nation, I would tend to write an article that makes you be protection hampers innovation, by this you will allow external forces to exploit you.
If you ask me, that is the basics of the article above.
I can protect what I have as a nation and still be innovative, I do not see a direct proportionality between innovative and protection.
If a Nation refuses to protect what she has, such as natural resources, other countries will exploit her. This is the situation of Africa in the global politics.

[BIT-BENDER]

Honestly, other nations will end up selling and getting better to other nations, whereas USA will end up staying behind, because if others can't sell to USA, you think they will just keep getting American products?

Let's be honest do you actually think the US can be left behind, be frank. Yes the US is in a tariff war with some countries that still don't mean they would be stagnant while other countries grow.
The US can easily turn their back on the tariff and still get the best deal out of the situation that will affect the market even more.
I don't agree with some of Donald Trump's policies and actions since he reassumed office but America is still a very influential country and it would take more than a tariff to get them stuck for too long in a mud.

[slapper]

People have always been told that "tariffs will save us", yet when the doors closed in 1807, it was British plans and immigrant know-how that really set things off. Industries have been doing this for decades: they defend themselves, then they stop growing, and then they ask for help as the world goes on. The big auto companies used to fight against imports, but now they want protection from the rules in their own nation. Isn't it crazy how "innovation" is used when it's useful, but political favors are what truly make things happen? I'd say that protectionism is basically a stop button that costs a lot of money. You can hit it, but you're already behind when you unpause

[kryptqnick]

It's not in the spirit of the US financial freedom and capitalism to invoke protectionism. I suppose protectionism can work in some very isolated societies, but even in those cases, probably not that great, if even China, a communist country, is kinda doing capitalism over the last few decades.

Protectionism is, IMO, for the most critical periods, where things are literally getting so out of control that there's no way to avoid stricter policies.

The US has been doing really well, and these chaotic tariff threats and policies are not in the interest of the US citizens.

[Guccho]

It’s apparent that tariffs and protectionism haven’t been the actual cause behind America’s industrial success, It was mostly about learning from others and bringing in new talents and tech, Tariffs could help certain local firms in the short term but in the long run they only hold back innovation and make items more expensive. The experience of the car industry shows how safeguarding enterprises may sometimes do more harm than good, especially for developing countries focused on growth through innovation seems lot smarter than just throwing up trade barriers

[WillyAp]

Most of us are aware that tariffs are not the miracle cure for an ailing economy.
Most 3rd world countries protect their economy through tariffs and what has that brought them?

The article goes further. Showing that protections have a side effect: Killing innovation.

The US and its consumerism is the motor of the world's economy.
Bitcoin's development and rise began over consume, giving away free satoshis for a few clicks.

[philipma1957]

Honestly, other nations will end up selling and getting better to other nations, whereas USA will end up staying behind, because if others can't sell to USA, you think they will just keep getting American products?

Let's be honest do you actually think the US can be left behind, be frank. Yes the US is in a tariff war with some countries that still don't mean they would be stagnant while other countries grow.
The US can easily turn their back on the tariff and still get the best deal out of the situation that will affect the market even more.
I don't agree with some of Donald Trump's policies and actions since he reassumed office but America is still a very influential country and it would take more than a tariff to get them stuck for too long in a mud.

That is because you don't want to realize have f'd up the USA is at the moment.

We the USA are in the early Stage of a civil war.

instead of the North vs the South over salvery we now are sanctuary states vs non sanctuary states.

Neither side is giving in and we could end up spliting the USA into multiple sections.

[Oluwa-btc]

Most of us are aware that tariffs are not the miracle cure for an ailing economy.
Most 3rd world countries protect their economy through tariffs and what has that brought them?

The article goes further. Showing that protections have a side effect: Killing innovation.

The US and its consumerism is the motor of the world's economy.
Bitcoin's development and rise began over consume, giving away free satoshis for a few clicks.

Using inspection,most countries are bent on surviving other than innovating or even other perspectives.To an extent, protectionism can be equally correct but it depends type and extent of protection or the context that actually fuels the protection to take place.
Alas,Some protection triggers innovation which encourages improvements In the industry.

[pooya87]

The US has been doing really well, and these chaotic tariff threats and policies are not in the interest of the US citizens.

Has it?
I don't think you can consider $37 trillion national debt and a budget deficit that surpassed $1 trillion for fiscal year 2025 as "doing really well". In fact the reason why the US government is desperately trying to increase its revenue through tariffs is because they aren't doing well at all.

[WillyAp]

Has it?
I don't think you can consider $37 trillion national debt and a budget deficit that surpassed $1 trillion for fiscal year 2025 as "doing really well". In fact the reason why the US government is desperately trying to increase its revenue through tariffs is because they aren't doing well at all.

Most people find it outrageous, but its just a number.
People in public office receive a cut for each credit they manage to take in behalf of their country.
No wonder that many wish for political career. 

[pooya87]

Has it?
I don't think you can consider $37 trillion national debt and a budget deficit that surpassed $1 trillion for fiscal year 2025 as "doing really well". In fact the reason why the US government is desperately trying to increase its revenue through tariffs is because they aren't doing well at all.

Most people find it outrageous, but its just a number.
People in public office receive a cut for each credit they manage to take in behalf of their country.
No wonder that many wish for political career. 

It is just a number but it is being translated to higher inflation, higher interest rates and consequently recession for the regular people. Also as the US government's budget deficit grows, they have been firing a lot of their employees. Some of them from national security related jobs!

[WillyAp]

Also as the US government's budget deficit grows, they have been firing a lot of their employees. Some of them from national security related jobs!

Nothing new.
Argentine went thru s similar turmoil just Miley was consequent and upended half of his state aparatos. 
That in itself is innovative. Not so the US. Is that government now smaller?