Why Shein & Temu Are So Cheap

Why this matters

Zero dollars is what a Shein or Temu package under $800 owes in duty crossing the border, a loophole from the 1930 Tariff Act that lets over a billion packages a year in untaxed. Before the policy question, my students learn the five-step production model, tiny test runs, algorithm-driven design, factory-direct shipping, that makes a price that low possible.

The tariff math convinces them something is off: what a store like Macy's pays in duties on a dress next to what the identical dress costs a platform shipping under $800 shows the gap in real dollars. Weighing that against documented labor conditions and ocean plastic pollution turns the paper into an argument.

From one teacher to another

Students step into a policy analyst's seat working with Ambassador Devon Khalil at the U.S. Trade Representative's office, drafting a position paper on whether the U.S. should close the $800 de minimis loophole that lets platforms like Shein and Temu ship over a billion packages a year into the country without paying duty on any of it. Before they touch the policy debate, they have to understand the production model that makes the price possible in the first place, tiny test runs, algorithm-driven design pulling from social media, and shipping straight from a factory floor instead of sitting in a U.S. warehouse. The tariff math is where the loophole actually becomes visible, since I have them calculate what a store like Macy's pays in duties on a dress next to what the exact same dress costs a platform shipping under $800 at a time. It closes on the trade-offs nobody puts on a price tag, documented factory conditions and how much of ocean plastic pollution traces back to synthetic textiles like the ones in fast fashion.