The thing is that you invest and build things like factories with a long-term time horizon. One of the things that makes stable western democracies rich is that we have stable governments and a rule of law that makes planning these large, long-term investments easier. With Trump, you have no idea what is happening next month, never mind next decade. And you can assume that most of this crazy stuff will be repealed in 4 years max. So, it is not worth building most of the factories you would need if this were going to be the policy for decades.
As you say, the supply chain is unlikely to shift that much. What will happen are changes in demand. It will hurt both sides.
There is a reason that The Depression was global. You cannot tariff your way to prosperity.
The thing is that you invest and build things like factories with a long-term time horizon. One of the things that makes stable western democracies rich is that we have stable governments and a rule of law that makes planning these large, long-term investments easier. With Trump, you have no idea what is happening next month, never mind next decade. And you can assume that most of this crazy stuff will be repealed in 4 years max. So, it is not worth building most of the factories you would need if this were going to be the policy for decades.
As you say, the supply chain is unlikely to shift that much. What will happen are changes in demand. It will hurt both sides.
There is a reason that The Depression was global. You cannot tariff your way to prosperity.