Feeling confused about tariffs? Are they good or bad for America? Depending on your news source, you probably either love ‘em or hate ‘em. President Trump sees tariffs as a source of revenue as well as a job-creating mechanism for the U.S. Meanwhile, a federal court recently ruled that most of the tariffs implemented are illegal. The Supreme Court will take this up soon to resolve the issue.
If you’d like some factual information about international trade and tariffs, you might consider a production by Steve Ballmer entitled Just the Facts! Steve Ballmer is best known as the successor CEO to Bill Gates at Microsoft. Ballmer ran Microsoft from 2000 to 2014. Depending on the price of Microsoft stock, Ballmer’s net worth is around $150 billion, give or take. You can access Just the Facts on YouTube. In fact, you can access Just the Facts without having to watch any of those annoying commercials that come in front of your video. Nor are there any subscription fees. Mr. Ballmer doesn’t need your money!
As the program name implies, Ballmer reports facts, not his opinion, and these are facts (e.g., generally numbers) reported by the federal government. In 2024, the U.S. imported $4.1 trillion in goods and services. We exported $3.2 trillion in goods and services, resulting in a trade deficit of around $900 billion. Running a trade deficit isn’t anything new; we’ve consistently run a trade deficit since 1976. To put this in perspective, the total output of our economy (as measured by GDP) in 2024 was $29.2 trillion.
We have trade relationships with about 200 countries/territories, which is just about all of them. Our major trading partners are, in order of dollar volume, Mexico, Canada, China, UK, Germany and Japan. These six countries account for roughly half of total international trade.
Our largest trade deficit is with China. In 2024, China shipped us $439 billion in imports. We exported $144 billion to China, resulting in a trade deficit of $295 billion. Interestingly, we actually run trade surpluses with 25 countries, meaning we ship them more than they ship us.
In 2024, tariff revenue accounted for only about two percent of total federal revenue, with roughly 70 percent of imports entering our country free of any tariffs.
Ballmer notes that imposing tariffs on trade partners involves tradeoffs. Tariffs are an additional cost for the products and services being imported. Logically, consumers will absorb at least some of that cost in the form of higher prices. This is supported by our own government research from the Bureau of Labor Statistics. But the expected tradeoff is that tariffs will stimulate domestic production of goods and services here at home, thus creating jobs for Americans.
Ballmer sums up the 16-minute video by asking: “So what’s more important? Lower prices for consumers or more jobs for U.S. workers? You have to decide what you think!”
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