One of the biggest concerns about tariffs is the opportunities for rent seeking. The Trump administration is carving out exemptions, some quietly, some not so quietly, for favored groups.
This is a direct result of lobbying and may explain party why the stock market isn't moved much by tariff announcements anymore: the tariffs primarily impact the little guys who aren't listed.
If nothing else, this whole fiasco will be studies for years, a kind of natural experiment that will provide us new insights on trade and growth.
Thank you for writing your in-depth pieces! I appreciate how well you explain everything and connect dots for readers. Hope to see more, keep up the great work.
I think the Supreme Court will give back tariff - commerce and taxation authority - to the legislature. I’m curious how quickly the market and supply chains and deals adjust.
I don’t think this administration is making the tariff decisions on the basis of what the future will be like, but on what amounts of money they can squeeze out of which corporations now. For that reason AI is where the money is for them to squeeze.
Really intersting how the tariff exemptions basically created a two-tier policy where Big Tech gets a free pass while everyone else pays up. The timing is wild too - TSMC is already maxed out on CoWoS capacity and now they're getting this indirect subsidy through tariff exemptions on the finishd systems. Makes you wonder if the 'friend-shoring' narrative was ever really about supply chain resilincy or just about letting hyperscalers keep their margins fat while the domestic fab buildout takes forever to materialize. Also curious how this plays out when TSMC's Arizona facility finally ramps - will we see the exemptions disappear or is this the new normal?
As a former US Customs Commercial Ops specialist, focused on computers and telecoms, I was delighted by your level of detail and your insight to connect the dots to the larger economic picture, as so many others have said. In the 90's, before Customs left US Treasury and became a nearly-forgotten appendage to the post-9/11 "Homeland Security" surveillance leviathan, finished computers were tariffed at 3.7% of import value, but computer parts were imported duty-free. This had the desirable effect of incentivizing US assembly of computers, from parts that were built mainly in Korea, Taiwan, Thailand, Malaysia and Singapore. I had the good fortune to visit many of these plants across the US for import compliance as part of my job, and enjoyed meeting some of the multitude of workers with good jobs -- jobs that sadly disappeared as the International Telecommunications Agreement took effect in 1998 (free duty on all telecoms equipment, whether finished or parts) and perhaps more importantly, as China gained entry into the WTO and gained most-favored-nation tariff status with the US. This is just another example of how good Trumpism is at pointing out systemic flaws, and then how horribly they address them. E.g., most of us could have understood a thoughtful, moderately-paced increase on tariff levels across-the-board (say 2 to 5%), or a more focused program of gradually escalating tariffs on products that are important to national security, even though theoretically we're all a little worse off in big picture economics. But the ridiculousness of implementing country-specific tariff levels to a corresponding (but not correlated) trade imbalance, and with carved-out exemptions for executives that bend the knee and/or "donate" to the cause, and the disparate tariff treatment of neighbors Brazil and Argentina because of their political bent, is astounding. Absolute bonkers! Now there comes solid arguments that this Ai build-out may be the mother of all bubbles. God help us if it is.
Many states have extended statutes of limitations for child sex exploitation. Maybe one or more of those states has jurisdiction over some of her actions.
Thank you for this! If anything this shows the very clear risks to concentration and “follow-the-heard” thinking. A small number of monolithic tech companies are individually betting that AI investments will pay off and further warping the rest of the economy around them. And as ever more is invested in making that payoff, there is ever higher risk that it won’t payoff enough. We are watching and economic sunk cost fallacy play out in real time.
I’ve been struggling for a while to understand the linkup between tariffs, AI investments, a clearly stagnating economy, dominance of the USA stock market by a limited number of tech monopolies, and the rest of the indicators. And a lot of the explanations elsewhere come across as overly simplistic. This really helped it click for me. Thank you!
Very comprehensive look at tariffs. What it boils down to is trump is feeding his tech bro cabal and starving the poor, working class, and middle class. Standard feed the wealthy, starve the rest republican economic policy. Do data center owners give a damn about electricity prices going up 6%? No, but someone on a fixed income wire does. musk is polluting the Mephis area with his grok crock. Putting the health of residents at risk while churning out garbage that helps np one opacted by his environmental damage. While AI is both amarvel and a curse, the brunt of the damage will be absorbed by the citizenry and the environment while to wealth is distrubted to a few. I love the promise of AI, but the damage it causes is is not being fully appreciated, yet...
One of the biggest concerns about tariffs is the opportunities for rent seeking. The Trump administration is carving out exemptions, some quietly, some not so quietly, for favored groups.
This is a direct result of lobbying and may explain party why the stock market isn't moved much by tariff announcements anymore: the tariffs primarily impact the little guys who aren't listed.
If nothing else, this whole fiasco will be studies for years, a kind of natural experiment that will provide us new insights on trade and growth.
That experiment had already been conducted by developing countries with post-war import substitution policies.
Thank you for writing your in-depth pieces! I appreciate how well you explain everything and connect dots for readers. Hope to see more, keep up the great work.
I think the Supreme Court will give back tariff - commerce and taxation authority - to the legislature. I’m curious how quickly the market and supply chains and deals adjust.
With /this/ court, I find that unlikely.
I don’t think this administration is making the tariff decisions on the basis of what the future will be like, but on what amounts of money they can squeeze out of which corporations now. For that reason AI is where the money is for them to squeeze.
Really intersting how the tariff exemptions basically created a two-tier policy where Big Tech gets a free pass while everyone else pays up. The timing is wild too - TSMC is already maxed out on CoWoS capacity and now they're getting this indirect subsidy through tariff exemptions on the finishd systems. Makes you wonder if the 'friend-shoring' narrative was ever really about supply chain resilincy or just about letting hyperscalers keep their margins fat while the domestic fab buildout takes forever to materialize. Also curious how this plays out when TSMC's Arizona facility finally ramps - will we see the exemptions disappear or is this the new normal?
As a former US Customs Commercial Ops specialist, focused on computers and telecoms, I was delighted by your level of detail and your insight to connect the dots to the larger economic picture, as so many others have said. In the 90's, before Customs left US Treasury and became a nearly-forgotten appendage to the post-9/11 "Homeland Security" surveillance leviathan, finished computers were tariffed at 3.7% of import value, but computer parts were imported duty-free. This had the desirable effect of incentivizing US assembly of computers, from parts that were built mainly in Korea, Taiwan, Thailand, Malaysia and Singapore. I had the good fortune to visit many of these plants across the US for import compliance as part of my job, and enjoyed meeting some of the multitude of workers with good jobs -- jobs that sadly disappeared as the International Telecommunications Agreement took effect in 1998 (free duty on all telecoms equipment, whether finished or parts) and perhaps more importantly, as China gained entry into the WTO and gained most-favored-nation tariff status with the US. This is just another example of how good Trumpism is at pointing out systemic flaws, and then how horribly they address them. E.g., most of us could have understood a thoughtful, moderately-paced increase on tariff levels across-the-board (say 2 to 5%), or a more focused program of gradually escalating tariffs on products that are important to national security, even though theoretically we're all a little worse off in big picture economics. But the ridiculousness of implementing country-specific tariff levels to a corresponding (but not correlated) trade imbalance, and with carved-out exemptions for executives that bend the knee and/or "donate" to the cause, and the disparate tariff treatment of neighbors Brazil and Argentina because of their political bent, is astounding. Absolute bonkers! Now there comes solid arguments that this Ai build-out may be the mother of all bubbles. God help us if it is.
So many insightful snippets and important conclusions can be drawn from this piece, fabulous work.
I enjoyed reading your article. Thanks
Many states have extended statutes of limitations for child sex exploitation. Maybe one or more of those states has jurisdiction over some of her actions.
The WaPo article this more about data centers around WDC is stunning: https://www.washingtonpost.com/opinions/interactive/2025/data-centers-artificial-intelligence-virginia-photos/ Sorry … couldn’t figure out how to gift it.
Thank you for this! If anything this shows the very clear risks to concentration and “follow-the-heard” thinking. A small number of monolithic tech companies are individually betting that AI investments will pay off and further warping the rest of the economy around them. And as ever more is invested in making that payoff, there is ever higher risk that it won’t payoff enough. We are watching and economic sunk cost fallacy play out in real time.
I’ve been struggling for a while to understand the linkup between tariffs, AI investments, a clearly stagnating economy, dominance of the USA stock market by a limited number of tech monopolies, and the rest of the indicators. And a lot of the explanations elsewhere come across as overly simplistic. This really helped it click for me. Thank you!
Very comprehensive look at tariffs. What it boils down to is trump is feeding his tech bro cabal and starving the poor, working class, and middle class. Standard feed the wealthy, starve the rest republican economic policy. Do data center owners give a damn about electricity prices going up 6%? No, but someone on a fixed income wire does. musk is polluting the Mephis area with his grok crock. Putting the health of residents at risk while churning out garbage that helps np one opacted by his environmental damage. While AI is both amarvel and a curse, the brunt of the damage will be absorbed by the citizenry and the environment while to wealth is distrubted to a few. I love the promise of AI, but the damage it causes is is not being fully appreciated, yet...
The answer to your subtitle is easy. We can't/won't play the tRump grift game.
Of course we should. And one of the reasons we should is that by tariffing some items, we subsidize non-tariffed items and tax exports.