Tariffs were sold as the cure for the trade deficit.
The reality? They made it worse.
Last 20 months: –$2.06 trillion goods deficit
Previous 20 months: –$1.92 trillion goods deficit
That's an 8% increase.
This is what happens when policy gets designed around headlines instead of economics. Tariffs don't magically fix structural imbalances — they just shift costs around, often in messy ways. Domestic producers raise prices because they can. Consumers pay more. Retaliatory tariffs hit exporters. And the deficit? It keeps growing.
The trade deficit isn't inherently evil, by the way. It reflects capital flows, consumer preferences, and the dollar's reserve currency status. But if you're going to promise a fix, at least deliver something other than the opposite.
This is a reminder: economic policy is hard. Soundbites are easy. And the gap between the two usually shows up in the data a year later.
The reality? They made it worse.
Last 20 months: –$2.06 trillion goods deficit
Previous 20 months: –$1.92 trillion goods deficit
That's an 8% increase.
This is what happens when policy gets designed around headlines instead of economics. Tariffs don't magically fix structural imbalances — they just shift costs around, often in messy ways. Domestic producers raise prices because they can. Consumers pay more. Retaliatory tariffs hit exporters. And the deficit? It keeps growing.
The trade deficit isn't inherently evil, by the way. It reflects capital flows, consumer preferences, and the dollar's reserve currency status. But if you're going to promise a fix, at least deliver something other than the opposite.
This is a reminder: economic policy is hard. Soundbites are easy. And the gap between the two usually shows up in the data a year later.