r/morningsomewhere • u/BurvinGoel2 • 6d ago

Clarification on Tariff Chart

So Ashley and Burnie talked a bit about the new Trump tariffs today and I think there is a bit of context the White House is, (intentionally), leaving out. They framed it as the left hand side numbers are the "tariffs" that other countries are currently putting on us, but this isn't true. The administration chose these numbers through a formula that has nothing to do with a country's tariffs.

Effectively, they took the total exports from a country minus the imports from that country to find the trade deficit, then divided that number by the exports again. For example, we have a $17.9 billion dollar trade deficit with Indonesia. It's exports to us are $28 billion. 17.9 / 28 = .64, aka 64%, the supposed "tariff" that they say is being imposed on us. Ryan Peterson on twitter showcased a graph where he used this equation for each country that is having tariffs imposed and every number comes out perfectly to what is on the chart. If the country would have a percentage that falls below 10%, or like with Guatemala were we actually have a trade surplus, they are hit with 10% as the baseline. This is why the UK has such a low tariff compared to others, as the trade deficit is pretty low.

Basically, the administration is lying about where these numbers are coming from and intentionally misconstruing the facts to manipulate their base. Really got to hand it to Burnie and Ashley for being obviously hesitant about accepting these numbers at face value!

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u/shiruken First 10K - Not a Financial Advisor 6d ago

The administration has now admitted that this is exactly how the tariffs are being calculated:

The specific “reciprocal” tariff rate was roughly half of the current trade imbalance because “the president is lenient and he wants to be kind to the world,” a Trump aide told reporters.

“The numbers [for tariffs by country] have been calculated by the Council of Economic Advisers … based on the concept that the trade deficit that we have with any given country is the sum of all trade practices, the sum of all cheating,” a White House official said, calling it “the most fair thing in the world.”

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u/-Plantibodies- 6d ago

God he really is such a weak man pretending to be a strong man. And the weak men out there eat it up.