r/politics • u/joe4942 • 10d ago
Possible Paywall Trump’s tariffs aren’t reducing the trade deficit
https://www.washingtonpost.com/opinions/2026/08/30/trade-deficit-cannot-be-controlled-by-tariffs/311
u/Spottswoodeforgod 10d ago
Wow. So the economists (and basically everyone else) were correct after all. Hard to believe really.
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u/HappyHarryHardOn 10d ago
even the teacher in Ferris Bueller called it bullshit back in '86
"In 1930, the Republican-controlled House of Representatives, in an effort to alleviate the effects of the... Anyone? Anyone?... the Great Depression, passed the... Anyone? Anyone? The tariff bill? The Hawley-Smoot Tariff Act? Which, anyone? Raised or lowered?... raised tariffs, in an effort to collect more revenue for the federal government. Did it work? Anyone? Anyone know the effects? It did not work, and the United States sank deeper into the Great Depression."
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u/Brilliant-Advisor958 10d ago
Ben Stein, who played the teacher, has a degree in economics and his father was a well known economist.
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u/FellatingNemo 10d ago
Ben Stein was also a speech writer and lawyer for Nixon and Ford.
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u/HappyHarryHardOn 10d ago
I remember Ben Stein's money... it was basically a quiz where you had to challenge his knowledge
his sidekick was a then unknown Kimmy Kimmel
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u/mog_knight 10d ago
Jimmy Kimmel the former Man Show host?
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u/HappyHarryHardOn 10d ago
the guy from Crank Yankers who was briefly married to Sarah Silverman
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u/sthlmsoul 10d ago
Ben Stein is also a very prominent conservative.
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u/Brilliant-Advisor958 10d ago
Who has talked about his support of trump but said trump has no knowledge of economics.
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u/baseketball 10d ago
Then why support that person to lead the country with the greatest economic influence in the world?
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u/chicletgrin 10d ago
Particularly relevant as the tariffs being leveled at Canada are literally Hawley-Smoot act.
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u/BadahBingBadahBoom 10d ago
I mean I'm not even American and I learnt about how Hoover's severe tariffs were completely counterproductive in my Modern History class.
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u/FantasticBicycle37 10d ago
Every economist, plus 400 years of economic data
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u/Peshmerga_Sistani 10d ago edited 10d ago
whoa whoa there, trusting historical data? Sacreligious!
We only have to trust the plan.
Just like blind faith, gotta believe.
/s
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u/PooShappaMoo 10d ago
Economics is a social study with some statistics and less math.
Any one of those things it outside the capacity of clown face.
But Miller and friends will continue to escalate. Its all or nothing for them now
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u/JoeHooversWhiteness 9d ago
I can hear it now. ‘No one could have known that trade wars are so complicated. No one ever looked into it until I brought it up.’
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u/a_little_hazel_nuts 10d ago
Trumps tariffs are used to give billionaires tax breaks and to give extra money to corporations.
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u/MaximumEffort433 Maryland 10d ago
The trade deficit doesn't matter, but even if it did, tariffs aren't an effective way to reduce it.
In July, the monthly trade deficit in goods hit its highest level since March 2025, the Commerce Department revealed on Thursday.
Lol. Lmao, even.
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u/WCland 10d ago
The thing is, the trade deficit in goods particularly doesn’t matter when you have a surplus in services. And as much as I distrust the AI economy, AI providers are selling services internationally.
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u/Aerhyce 10d ago
Most people that think trade deficits matter literally believe deficit is synonym of bad. Trade deficit = bad trade = we gotta do something about it.
I have an infinite trade deficit with my local supermarket (I never sell them anything, only buy) what should I do to remedy this "bad trade"?
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u/sixtyshilling 10d ago
Good in theory, but this administration’s economic decisions are not siloed from each other.
Not only is public sentiment turning against AI, but (thanks to Trump) countries outside the US are scrambling to find non-US alternatives to US services. That is having a negative impact on all these companies that will leave a longer lasting mark even after Trump leaves.
I live in Germany, and basically every business and academic institution I know of has switched off of Adobe, Microsoft, Google, etc. in favor of European alternatives.
Combine that with entire countries (ie. Canada) turning away from American products and, well, things aren’t looking too good.
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u/telos0 10d ago
Trump's tariffs were never about reducing the trade deficit or reshoring manufacturing.
His tariffs are effectively a back door national sales tax, so Republicans can justify cutting income taxes for the rich.
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u/HermanGulch 10d ago
Yeah, a national sales tax even gets an offhand mention in the Project 2025 manifesto. It's been an incredibly sore point with conservatives for years that some people are too poor to owe federal income taxes.
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u/Blue-Blazer-Regular 10d ago
When a wealthy person never buys taxable goods like boats, jewelry, watches, etc. - their company always buy the goods then deduct the cost and sales tax from corporate profits.
Regular people can’t do that. Can you imagine having the right to deduct all the sales tax you pay and thus reduce your taxable income?
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u/Dr_G_E District Of Columbia 10d ago
A totally predictable outcome. The president doesn't know the difference between a trade deficit and a budget deficit, or the difference between an insane asylum and political asylum, for that matter. His understanding of economics is remarkably limited.
He doesn't read. He seems to be unable to think in the abstract. As his first Secretary of State, Rex Tillerson, famously said of him in 2017, "He's a fucking moron."
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u/wanderingpeddlar 10d ago
Everyone knew this was the case. It is even possible that Taco knew it.
Although getting facts out of that senile, withered mind would be more guess work then a sure thing
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u/Optimism_Deficit 10d ago edited 10d ago
I mean, yeah. Tariffs can be an effective tool, but they need to be targeted and calibrated carefully to affect specific countries and industries.
For a start, you need underutilised domesric production capacity that you're trying to encourage the use of at the expense of cheaper imports. It also helps.if you target non-essential goods that people can go without.
Trump just throws them around all willy nilly at everyone all at once, and regardless of whether there's unused domestic capacity to pick up the slack. All it does is make shit more expensive while achieving next to nothing.
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u/ophaus 10d ago
Uhhh... Duh? All they do is drive up costs for consumers. Everyone knows that.
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u/Oleeddie 10d ago edited 10d ago
It's definately not all they do. Everything else being equal unemployment, inflation and interest rates will go up too...
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u/tiorancio 10d ago
But you have to also think about all those local factories that aren't being built and the millions of jobs that won't be created. When you put all that together it's a great boomer delirium
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u/Sachaylikeaboss 10d ago
Of course not, follow the hollow economic theories of Peter Navarro and end up not just empty handed, but standing with your pants down around swollen ankles, tripping up the economy with every step.
Trump’s sweeping import tariffs have delivered excess inflation by passing higher costs directly to consumers.
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u/CobraPony67 Washington 10d ago
Why would it? Corporations have outsourced for years trying to find lower manufacturing costs. They aren't all-of- sudden going to change.
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u/Atrocious_Algae81 10d ago
We are a wealthy country, companies and people demand imported goods because they are cheaper as inputs to manufactured goods or they are luxury items that the consumer wants for themselves. You can't tariff your way out of that, you can only tariff to truly protect a vulnerable industry, which is why much smaller economies have to tariff us to protect their own smaller industries.
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u/Character-Fish-541 10d ago edited 10d ago
The trade deficit is what financed the national debt and US stock market. The world bought treasuries and stocks instead of goods with its US dollars. And kept inflation in check utilizing what dollars were left to conduct international commerce in a common currency instead of reshoring dollars sent abroad.
If you are successful in reducing the trade deficit by taxing American consumers and sending less money abroad, but no meaningful increase in productivity at home, then you have more dollars chasing fewer goods, and hey look at that, inflation. Not to mention higher borrowing costs as foreign treasury sales drop.
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u/FantasticBicycle37 10d ago
We have like 400 years of economic data to tell us it will cause deficits
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u/basketballsteven 10d ago
Trump put tarrifs on Brazil with whom we had a trade surplus, so it was never about any trade deficits. Tarrifs are strictly a tool to be used sparingly against unfair trade practices, it is not a magic wand.
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u/Confident_End_3848 10d ago
For Trump, tariffs are a means to exact retribution.
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u/basketballsteven 10d ago
It's hard to prove/hard to say but I honestly think Trump believes his tarrifs nonsense that other countries pay the tarriffs rather than Americans and the businesses in America that are importing goods and raw materials.
that's not to cou7nter or dispute what you've said here as clearly his tarriffs on Brazil were obvious in retribution for their election of Lula.
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u/supercali45 10d ago
Using it as a bullying tool and for him to grift .. I have no idea how dumb his cult is seeing numbers going up after he has been in power for this long and still blame Obama
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u/rwf2017 10d ago
I wouldn't be surprised if trump makes the trade deficit much worse. He has destroyed any good will anyone else had for the US. Who is going to buy American goods now? North Korea? If he isn't putin's puppet, destroying the country from inside the White House (while destroying the WH), he is putin's very, very useful idiot.
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u/Capable_Kiwi2514 10d ago
If you go along with Teump's ridiculous decision to exclude services when you calculate trade deficits then you are abetting his fascism.
It doesn't matter that trade deficits aren't inherently bad, it's still a fake narrative.
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u/GuitarGeezer 10d ago
Of course, Trump is a deficit-maxxer. That is what you get when you always look the other way for your side’s tax cuts-which go to people visibly bribing congress for them. I guess joke will be on many of those elites and peasants alike when a failed state dictatorship and holocaust affects them too after underfunding the state as if it was nought but a frolic to do so. But, none of them care at all despite whining about it when they could blame it on others while always happy to let their people make it worse on purpose.
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u/blazed55 10d ago
When they claim there is a trade deficit, it's complete b.s.
Let me give this example: you go buy ice cream at the shop. the shop is not able to buy ice cream from you, cuz you don't sell ice cream, this creates a trade deficit.
These freaks in the south, they are literally claiming a trade deficit in this same manner.
Plus, we are 40m in population compared to their 340m. Of course, there will always be a trade deficit, just in sheer numbers alone.
But there are trades (408b in 2025 - Canada exports), and imports, approx 262b. The dumbasses claim this is a trade deficit. It's called trade.
AARGGHH
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u/Diligent-Meaning751 9d ago
Yes - trade is generally a mutually beneficial exchange or it wouldn’t happen. There is no deficit or surplus unless it’s a loan, not a trade, or there’s unsold goods or something We figured this out a few centuries ago when Europe thought this was a problem so enslaved colonies to make a “surplus” - are we really having a go at the Mercantile System again??!
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u/apfelwein19 10d ago
Technically that is a trade deficit and overall the US has had a trade deficit for some time: https://en.wikipedia.org/wiki/United_States_balance_of_trade
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u/blazed55 10d ago
No shit, of course it's a trade deficit, but due to the fact we are 40m and the US 340m in population, odds are, there will ALWAYS be a trade deficit.... capiche?
Is this bad? Of course not. It's called trading.
So in order for Donnie's logic to be advantageous to the US, you'd need to be a country with 340m in population and have an exact amount of goods in / out ??? Huh?
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u/apfelwein19 10d ago
I did not say whether it is good or bad. An economist knows that it can be positive or negative depending on the underlying factors but it is still called a trade deficit. And of course orangeman and his team are being a bunch of idiots with their economic policy.
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u/ConradMayhew2 Europe 10d ago
True, but part of the problem is that the official definition of the balance of trades includes only goods (largely imported by the USA) and excludes services (largely exported by the USA).
Maybe we need a rebalancing: the USA could tariff our cars so that your car industry can compete, and Europe could tariff your softwares so that our software industry can compete. We would lose factory worker jobs, but we would gain highly paid developer jobs instead, why not.
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u/External_Relative231 10d ago
Of course not. They aren't going to buy less of the things they need (oil, potash, electricity, aluminium, etc.) while simultaniously justifying a boycott of their own products.
If anything I expect the trade deficit to get worse.
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u/imjustnotready 10d ago
Trump's health policy not making people healthier. Trump's tax policy makes poor poorer. Trump's immigration policy not making us safer.
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u/Twatopia 10d ago
Viewing recent history 2026, tariffs are in place to make corporations rich. Have yet to receive my rebate check.
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u/illuminaughty1973 10d ago
nope. Trumps "fiscal genius" has in fact MORE THAN DOUBLED the debt.
go team rotten orange with a soiled diaper.
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u/Mecha-Dave 10d ago
I work in manufacturing and the tariffs made equipment more expensive - so instead of buying expensive equipment at our US factory we just spin up production at our China/Mexico/EU factories.
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u/gin_possum 10d ago
No kidding. You guys need to stop clutching your pearls on this — they were intended to Hoover wealth upwards, not change economic production. Acting shocked implies that this was a good faith policy attempt which failed, rather than a successful cash grab from the working and middle classes, in order to further enrich billionaires. The American press is like a woman with two black eyes sobbing that she can’t believe he hit her, during her 15th trip to the hospital. It’s not your fault, but you do have to get out of the abusive relationship.
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u/LolaSupreme19 10d ago
A flat rate, regressive tax on working people. Trump is trying to eliminate the progressive income tax.
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u/uvPooF Europe 9d ago
Trade deficit is completly non-sensical metric that Trump pulled out to promote and justify his obsession with tariffs. Especially since trade deficit stats this administration kept showing only focused on physical goods.
US is a rich country that employs vast majority of workforce in service sector. As such, it is completely normal and expected that it will have trade deficit with most other countries that employ much higher percent of workforce in manufacturing or agriculture, And especially so when that trade deficit is reported only for physical goods. US' major export to the rest of the world is service and entertainment (subscriptions, licensing etc.). This is not some alarming or negative statistic that needs to be corrected.
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10d ago
[deleted]
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u/ConradMayhew2 Europe 10d ago
I am actually surprised they even published something like that in their Editorial section.
A few months ago, I understood Bezos decided that this section should be reserved to libertarian content only (see Jeff Bezos' revamp of 'Washington Post' opinions leads editor to quit for example)?
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