Also, this announcement has wiped out any plans of buying tech products this year, plus a holiday to the US and Canada later in the year. Good thing too, as the entire globe is probably staring down the barrel of a recession.
So for example Indonesia and the US traded $28 billion. The US has a 17.9 billion trade deficit with Indonesia. 17.9/28 =0.639, or 64%, which is assumed to be all caused by tariffs. So they divide by two and impose 32%.
Anyway no the US isn't matching tariffs they're dramatically exceeding them.
I also think the US deficits are hugely overstated because much of what the US produces is intellectual capital rather than physical goods and the profits are made to appear in foreign subsidiaries for tax reasons. Like if I buy Microsoft stuff in the UK, Microsoft make out it was made in Ireland for tax purposes, but really the value is created in and owned by the US. The US company both wrote the software and owns Microsoft Ireland. So much of the perceived unfairness Trump is having a go at isn't real.
Secondly, if Microsoft or Apple makes the profit appear in Ireland, it cannot move that money back to the domestic US, right? So as long as the money sits overseas, it would not count towards US trade and thus the deficit calculation is fair.
You may not like a tech company succeeding at exports and having a rising share price, but that is distinct from the overall point which is that properly considered these are US exports obscured by the US tax code which incentivizes profits abroad.
However, in practice even if not repatriated those exports show up in the us economy. Profits raise the share price, which allows stock grants at higher values, effectively a wage as one example.
I wonder how big an effect this phenomenon you highlight has. Must be a fairly large overstatement of the US trade deficit.
Like, if I scribble on a piece of paper and then trade you the piece of paper for an incredibly engineered brand new laptop, is that bad for me? Is this a sign of my weakness?
I know economics can be complicated, and probably "it depends", but why is a trade deficit bad? Why does the Trump administration want to eliminate trade deficits?
No. Trump claims that the new tariffs are a 50% discount on what those countries tariff US goods at. (Even if that's questionable - is VAT a tariff?)
If he's correct, or anywhere close, this is a "tough love" strategy to force negotiations. We'll see how it goes. It also plays to his base - why should we tariff any less than they do us? And they have a point, it's the principle of the thing.
There is another camp that thinks that trump doesn't really have a goal per se, and is rather doing all this as an exercise in showing off his strength and to draw attention to himself. This camp holds that eventually trump will get bored, or the public will turn on him, and he'll need to get rid of tarrifs to save face. We call these people "optimists".
He's not.
According to [1], the White House claims Vietnam has a 90% tariff rate.
According to [2], 90.4% is the ratio of Vietnam's trade deficit with the US -- they have a deficit of $123.5B on $136.6B of exports.
The same math holds true for other countries, e.g. Japan's claimed 46% tariff rate is their deficit of $68.5B on $148.2B of exports. The EU's claimed 39% tariff rate is their deficit of $235.6B on $605.8B of exports.
Who knows, maaaaybe it just so happens that these countries magically have tariff rates that match the ratio of their trade deficits.
Or maybe, the reason Vietnam doesn't buy a lot of US stuff is because they're poor. The reason they sell the US a bunch of stuff is because their labour is cheap to Americans. (They do have tariffs, but they're nowhere near 90%: [3].)
America's government is not trustworthy. Assuming that what they say is truthful is a poor use of time.
[1]: https://x.com/WhiteHouse/status/1907533090559324204/photo/1
[2]: https://ustr.gov/countries-regions/southeast-asia-pacific/vi...
[3]: https://www.investmentmonitor.ai/news/vietnam-gives-us-tax-b...
Trump is not in the business of being _correct_, or indeed caring about correctness as a concept.
And no, these are, obviously, not the actual tariffs, don’t be silly.