Is the U.S. Government Financially Benefitting from Added Tariffs?

January 4, 2019 07:41 AM
 
 

Trade negotiations between the U.S. and China are ongoing, with the trade truce now facing a deadline of less than two months away. U-S Trade Representative Robert Lighthizer has a busy schedule next week, as he and others are preparing for trade talks with China in Beijing. President Donald Trump took to twitter ahead of those talks, touting the benefits of tariffs.

The United States Treasury has taken in MANY billions of dollars from the Tariffs we are charging China and other countries that have not treated us fairly. In the meantime we are doing well in various Trade Negotiations currently going on. At some point this had to be done!

— Donald J. Trump (@realDonaldTrump) January 3, 2019

Does the government really benefit from tariffs? Purdue University Economist Wally Tyner said the President's tweet is accurate in saying the treasury does take in revenue from tariffs. However, Tyner said it's currently unknown how much the department is actually getting from the added tariffs. In the end, he said tariffs aren't good for the government or the economy. 

“The way it works is an import comes into the border, a tariff is imposed, the treasury collects that tariff,” said Tyner. “The problem is that if an import comes in and is collected , that means the price of that good is higher to all American consumer - whether it's companies or individuals. Let's say a good comes to the border and costs $1, with a 25 percent tariff, that means when it gets to the consumer, the cost embedded in that good is now a $1.25. So, the consumer is paying the cost of that tariff, it's not that it's great for revenue for the government; it's that it harms consumers - whether they're businesses importing steel or whether it's consumers importing electronics. That's the problem with tariffs.”

Tyner also said tariffs harm the U.S. long-term, as it means goods and services in the U.S. cost more.

“Those importing countries are paying more and they’re finding other countries to get their products from,” said Tyner. “So, tariffs are bad for the economy in the long-run.”

Tyner said we’re already seeing the negative impact tariffs are having on the economy in the short-run. He said any economist will tell you “free trade” is better for the economy, as it makes the economy more efficient.

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Comments

 
Spell Check

Scott
WALCOTT, ND
1/4/2019 08:33 AM
 

  More BS from POTUS. Not only does Tariff's increase the overall prices's of good's, but it also encourage's the use of substitutes. Or finding alternative suppliers'. What about the MFP how many billion did that cost USA taxpayer's. Demand we may never see again. The lost business that have hurt all within industry. What are they doing in PNW ports now that there are no Soybeans being shipped. Less business means less revenue for our country. It's time the Republican's do some soul searching. One of the Republican's main economic theory's is based on doing more business to offset higher taxes. The DOW is dropping like a rock. Mostly due to POTUS incompetence. Who want's to do business with a bully. Can not imagine anyone willing to destruct our economy and are overall wealth of our country ,but that is what is happening. Land prices are falling cash rent's are under pressure at the least. The wealth of our nation is at stake. Perfect for less wealthy country's that would like to bring us down to their level.

 
 
Jeff Wochner
Polk, NE
1/9/2019 08:05 AM
 

  If Wally Tyner lived in the real world he would understand what the president was trying to do with the tariffs. Make trade fair things would be better for all.

 
 
Fred
Wolcott, IN
1/4/2019 11:12 AM
 

  North Dakota is taking more than their share of pain from the tarriffs. But. is it ok to buy those low priced products from countries that stole the technology to make them with labor being paid at sub standard levels? I'll pay that extra quarter for the dollar item if I know it'll help business in our country and people that are our neighbors. I've got a neighbors that work at Cat and a steel mill here that are doing great after the tarriffs stopped the flood of steel. Sometimes there are decisions that need to be made that aren't popular but necessary.

 
 

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