BREAKING: Trump Trade advisor, Peter Navarro, ridiculously claims that Auto tariffs will raise $100 billion and other tariffs will raise $600 billion a year. This is such a gaslighting attempt to mislead. No, they will NOT raise this much money. Not even close In 2024, the U.S. brought in... about 8 million cars from other countries, worth around $200 billion. If we taxed those cars at 25%, and that does not cause imports to fall (which it would), that would only bring in $50 billion, not $100 billion. And even if we did raise the tariff that high, it might backfire. When things get more expensive, people usually buy less. So if imported cars get too pricey, people might stop buying them—and that means we’d collect less in taxes, not more. An his other ridiculous claim that tariffs on all imports would bring in $600 billion, again, that doesn’t hold up. In 2024, the U.S. imported about $3.1 trillion worth of stuff from other countries. To get $600 billion in tariff revenue, we’d need to tax everything we import at an average rate of 20%—and pretend that people would keep buying the same amount of imported goods, even at higher prices. That’s just not realistic. To give you some context, during Trump’s first term, he put tariffs on about $300 billion of Chinese goods. Those tariffs were as high as 25%, but over several years they only brought in about $70 billion total—not per year. That’s because when you raise prices, businesses and consumers often change their behavior. They might buy from somewhere else, or not buy at all. So the actual money the government collects is a lot lower than it looks on paper. So, bottom line: the numbers Navarro and others are throwing around sound impressive, but they don’t really match how the economy works in real life.show more

Ed Krassenstein

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