#tariffs

Trump’s higher tariffs are certainly raising money. They’ve raked in more than $236 billion this year through November — much more than in years past. But they still account for just a fraction of the federal government’s total revenue. And they haven’t raised nearly enough to justify the president’s claim that tariff revenue could replace federal income taxes — or allow for windfall dividend checks for Americans.

The U.S. trade deficit, meanwhile, has fallen significantly since the start of the year. The trade gap peaked to a monthly record of $136.4 billion in March, as consumers and businesses hurried to import foreign products before Trump could impose his tariffs on them. The trade gap narrowed to $52.8 billion in September, the latest month for which data is available.

New U.S. tariffs have also harmed the company, especially a 46% levy on imports from Vietnam, where iRobot manufactures vacuum cleaners for the U.S. market. The tariffs raised the company’s costs by $23 million in 2025, while making it more difficult to plan for the future, according to iRobot's court filings.

Trump said at the roundtable, adding "this money would not be possible without tariffs."

Another way to spend the money that’s already been spent many times over.

Revlon and canned seafood and chicken producer Bumble Bee Foods have made similar arguments in the trade court.

The tariffs facing the court challenge have raised around $90 billion so far.

But Trump has promised debt reduction, deficit reduction, $2,000 dividend checks and farm bailouts with the money, among other things. All of it would cost hundreds of billions of dollars, if not trillions, more in total than is on track to be collected.

Research by Harvard Business School Professor Alberto Cavallo illustrates the downward trend in the price levels for many retail goods, followed by an acceleration after tariff announcements. Prices on both imported and domestic goods have climbed modestly but steadily since March, even if the hike is still small relative to the size of the tariffs.

The researchers created indexes with daily prices collected by PriceStats, a private firm cofounded by Cavallo that provides online data for over 350,000 products sold by five major US retailers. The indexes allow them to track price changes in specific categories and from countries of origin. Overall, the prices of imported products have increased faster than those made in the US. An extended analysis, going back to January 2024, explores price changes of goods relative to their pre-tariff trend.

Current Tariff Rate: Consumers face an overall average effective tariff rate of 17.9%, the highest since 1934. After consumption shifts, the average tariff rate will be 17.4%. (If IEEPA tariffs are invalidated, the rate would be 9.1%.)

Overall Price Level & Distributional Effects: TBL assumes the Federal Reserve “looks through” the tariffs and allows prices to rise such that the tax burden is felt through prices rather than nominal incomes. The price level rises by 1.3% in the short run, representing a loss of $1,800 for the average household and $1,000 for households at the bottom of the income distribution. (Without IEEPA, the price level impact would instead be 0.6%.)

A theme throughout the argument was a concern shared among several justices and the plaintiffs, summed up neatly by Gorsuch: “Congress, as a practical matter, can’t get this power back once it’s handed it over to the president,” the Trump appointed justice said. “It’s a one-way ratchet toward the gradual but continual accretion of power in the executive branch and away from the people’s elected representatives.”

“We will never get this power back if the government wins this case,” said Neal Katyal, who represented the small businesses challenging Trump’s initiative. “What president wouldn’t veto legislation to rein this power in and pull out the tariff power?”