Trump's tariff calculation questioned as misleading tactic
The Trump administration imposed tariffs on numerous countries, including some European Union states. The rates vary, and the White House claims they were determined based on the tariff levels in individual countries. However, commentators suggest that a simple formula, unrelated to actual customs duties, was decisive.
What you need to know
- The Trump administration imposed tariffs on numerous countries, asserting it wants to "punish" those with trade surpluses in their relations with the US.
- The White House justifies the rate levels using other countries' tariffs, but the specified amounts are inaccurate.
- Evidence suggests that Trump's team calculated the rates based on the trade surplus in relation to import value.
US President Donald Trump announced tariffs on various countries, claiming this move would protect the American market and its producers.
The tariff rates vary: China faces a 34% rate, the European Union 20%, Japan 23%, and India 26%. The hardest hit were Cambodia at 49% and the Territorial Collectivity of Saint Pierre and Miquelon at 50%.
Trump's formula: Is it deceptive?
The Trump administration argues its decisions by stating that these countries impose tariffs on American goods. However, the rates claimed by the White House do not reflect reality. For example, Trump asserts that EU tariffs on US products are 39%, which is inaccurate.
So what is the logic behind this? Journalist James Surowiecki notes that the alleged tariff rates other countries supposedly impose on US goods are simply the result of dividing the United States' trade deficit by the import value from a given country.
For instance, the US trade deficit with the EU in 2024 is over 235 billion dollars. The US imported goods worth over 605 billion dollars from EU countries. The surplus is thus over 38% of the import, almost matching the 39% declared by the White House.
However, the US also imposed rates on countries with which they have a trade surplus, like Australia. These countries were "hit" with 10% rates.
James Surowiecki criticized the approach, expressing disbelief that the decision-makers simply divided the trade deficit by imports to present it as the tariff rate. He pointed out that they then chose to set tariffs by halving this entirely arbitrary figure, calling the method both misleading and irrational.
