The Upside
Something good might come out of this global trade meltdown.
There’s much talk at the moment about financial catastrophe, global meltdown, looming recession. I actually had to shut the news apps last night as between impending war with Russia, domestic terrorism fuelled by conflict in the Middle East and the further rolling back of green initiatives, my heart began to flutter unnervingly.
So I would like to bring you some good news on the events of last week. Global supply chains and the proliferation of cheap goods are not great. Poor manufacturing processes, harmful chemicals and dyes, fossil fuel powered factories and labour abuses have led industry, including fashion, to a very shoddy place.
That’s before the consumer buys the cheap product. Afterwards, the quality deteriorates, the low price paid for it lessens the value relationship with the buyer, and so the product is discarded, while the cheap materials it is made from continue to sit around for a thousand years as they will not biodegrade or recycle.
Trump is trying to break that loop, (although I think we can safely say his motivations are different). Whatever it is he is trying to achieve, there are upsides. Buried in the ‘Liberation Day’ tariffs (or ‘Ruination Day’ as The Economist called it), was the closure of the de minimis loophole that allowed manufacturers like Shein and Temu to import goods without paying any import taxes or customs duties. If an imported product is under the value of $800, it was not subject to any of these taxes, allowing it to sail into the country at the cost of making it, plus margin. Its price undermined that of all competitors, reaching its apotheosis in a sort of raging customer hunger for more and more cheap things, a hunger that inspired the sort of shitty manufacturing that led someone to make a lamp out of an actual croissant.
(If you don’t know this story check out the below)
Maybe with the closure of this loop, (and the EU and UK have been talking about closing theirs too), we will begin to wean ourselves off poorly made cheap goods. We will unhook ourselves from this consumerist drug that has dulled our senses and sense of wellbeing, whilst tearing through the earth’s resources at an insupportable rate.
One man who is not worried about these tariffs is Bayard Winthrop, who has been focused on the upside ever since he founded his business twenty years ago.