{"text":[[{"start":6.16,"text":"Want to meet a victim of Donald Trump’s tariff war? Let me introduce Hank, a figment of my imagination. Hank is a retired machinist from Indiana. He now has a successful business as a sole proprietor importing tabletop war-gaming figures from China, modifying them using his metalworking skills, sending them to Spain’s world-class figurine-painting industry for decoration, bringing them back and profitably selling them. You might not think of someone like Hank as a hero of globalisation, but he totally is."}],[{"start":36.837,"text":"Until Trump (for whom Hank voted) came along, Hank’s imports from China and then Spain came in under the $800 “de minimis” exception to tariffs. Since Trump abolished de minimis, his business has been in turmoil."}],[{"start":51.68,"text":"The unprocessed imports from China now attract tariffs. For the figurines returning from Spain, the tariff will partly depend on whether the product is treated as originating in China after Hank has done his alterations to it. (Like the fictional Hank, I’ve done all this without professional customs advice, so tell me if I’ve got it wrong.) But regardless of whether he’s only liable for duties on the value added in Spain or on the whole value of the reimport, Hank must fight his way through the thicket of Customs and Border Protection regulations on “goods for repair or alteration”."}],[{"start":81.28,"text":"He’ll have to file a complex declaration signed by himself and the company doing the painting, and pay tariffs on return. If he’s particularly unlucky, the goods will be deemed incomplete when they leave the US — whether an unpainted figurine is a finished or unfinished product would seem to be a marginal case depending on past CBP rulings — and therefore subject to full tariffs on the way back. Hank might just give up his business altogether. Hank is planning to vote Democrat in November."}],[{"start":109.429,"text":"Trump removed de minimis on imports from China in May last year and from all countries in August; other trading powers including the EU have done similar. In recent months the US elimination was made permanent and certified as constitutional by a ruling from the Court of International Trade."}],[{"start":126,"text":"The move was supposed to hit Chinese companies like Temu and Shein, which sold directly to individual American consumers. It’s certainly not been great for them: the profits of Temu’s parent company dropped sharply after de minimis was removed. But both companies have adapted by shifting towards a warehouse model and using Chinese-owned delivery companies in the US. Getting rid of de minimis was intended to clobber Temu, but it’s inflicted collateral damage on many thousands of Hanks."}],[{"start":152.767,"text":"“Sounds good, but what about the paperwork?” is evidently not the kind of pettifogging woke technocratic objection given much shrift in the Trump administration. The abolition of de minimis has required a new system to be created for small-value parcels. It’s intended to simplify the process but still requires declarations of tariff classification, origin and valuation, and creates more work for customs professionals."}],[{"start":176.32,"text":"The typical effect of tariffs and trade restrictions — indeed regulation in general — is to advantage larger companies with more capacity for compliance. Trade is already heavily dominated by big business, which accounts for around two-thirds of US goods exports by value. Even they are feeling the strain: an industry survey by the American Association of Exporters and Importers and the supply chain company Altana says more than half of large-turnover companies don’t feel “trade ready” when it comes to dealing with the bureaucracy."}],[{"start":205.059,"text":"The more that exporters are swamped by successive waves of paperwork, the more that large companies get an advantage. Preferential trade agreements routinely contain chapters on small and medium-sized enterprises — which enable ministers to chunter about the importance of enabling the nimble minnows to swim the limpid waters of international commerce alongside the stately whales and so on — but these are widely and correctly regarded as primarily for show."}],[{"start":229.28,"text":"Research on the effect of Trump’s first-term tariffs on global production networks has added more detail to what we know about how companies respond. Chinese exports were routed through third countries, sometimes with some production moving too, and multinationals with flexible affiliate networks did the bulk of the work in rejigging supply chains. Domestic companies couldn’t do much more than let the shock hit them."}],[{"start":251.654,"text":"The Trump administration is now proposing yet another bureaucracy-creating wheeze in the form of increased reporting requirements to stop shippers mislabelling the origin of imports, an attempt to solve a problem it itself created. Experts in the industry are sceptical it will ever happen, given how overloaded the administrative system already is. Whether it does or not, one thing is absolutely clear: any time one of these initiatives is created, it favours the multinationals over the Hanks."}],[{"start":282.72,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1790234865_4155.mp3"}