00:00I always say tariffs is the most beautiful word to me in the dictionary.
00:04Tariffs. Trump's favorite economic buzzword.
00:07So what exactly is a tariff and how do they work?
00:09Simply put, a tariff is a tax that governments place on goods entering their country from abroad.
00:14Think of it as a fee for crossing the border.
00:16For example, if an American car company imports parts from Mexico,
00:20those parts are taxed when they arrive in the US.
00:23That's the tariff.
00:24But here's the kicker.
00:25This tax isn't paid by the foreign country.
00:28It's paid by the American company bringing in the goods.
00:30They do so by raising prices for you, the consumer.
00:33Now why does Trump love tariffs?
00:35For Trump, trade is a game of winners and losers
00:38and he thinks the US has been losing for decades.
00:41He often points to countries like China, Mexico and Germany,
00:45accusing them of unfair practices like stealing American intellectual property,
00:49manipulating their currency and flooding markets with cheap subsidized goods.
00:54Tariffs to him are the ultimate weapon to fight back.
00:57Besides, tariffs were part of his promise to bring jobs back to American shores.
01:02His message to manufacturers was clear.
01:04Move production to the US and you avoid tariffs.
01:08It was a rallying cry for workers in places hit hard by globalization and job losses.
01:13But here's the problem.
01:14Global supply chains are like Jenga towers.
01:16Move one piece and the whole thing could collapse.
01:19Building factories takes years and most companies can't simply pack up and move.
01:24Instead, tariffs often just raise costs and consumers feel the pinch through higher prices.
01:30So are tariffs truly the most beautiful solution for America's economy?
01:34Well, the debate continues.
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