At the end of January, President Trump penned a triumphant op-ed declaring “Mission Accomplished” for the signature economic policy of his second term: tariffs.
Unfortunately, his entire victory lap revolved around phony numbers, cherry-picked facts, and a strawman caricature of his critics’ arguments.
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Trump loves to tout that 4.3 percent annualized growth estimate for Q3 2025. Yet he neglects to mention his -0.6 percent growth rate during his tariff spree in Q1 2025. Experts project that actual growth for 2025 will fall somewhere between 2.2 percent and 2.5 percent — well below Sleepy Joe’s nothing-to-write-home-about 2.8 percent mark in 2024.
Incidentally, this 0.2-0.5 percent decline in real GDP is exactly in line with what economists predicted. Is 2.5 percent growth catastrophic? No. But it’s hardly an “economic miracle.” And it’s a far cry from the 5 percent growth we’ve been promised.
Another stat he conveniently omits: manufacturing employment has declined for nine straight months since Liberation Day. On that day, the White House predicted tariffs would add 2.8 million manufacturing jobs. Instead, we’ve lost 70,000.
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Trump loves to point out that billions in tariff revenue are “pouring in” to the Treasury each month. Economists yearn to snap back: “But who is paying it?!”
In his article, Trump cites a Harvard study that “found” foreigners are paying “at least 80%” of the tariffs. One minor problem: the study found the exact opposite: import prices are rising twice as fast as domestic goods prices, and virtually all of that burden has been borne by US firms and consumers. A different study found that Americans pay 96 percent of the tariffs. Evidently, Trump didn’t do his homework (or perhaps his ghostwriter put too much faith in ChatGPT).
Trump also takes credit for our declining monthly trade deficits. A reporter should follow up by asking: If trade deficits are so bad, Mr. President, then why don’t you cut your own hair to eliminate your trade deficit with your barber? Trade deficits sound scary, but they’re not. They don’t make us poorer. They aren’t akin to budget deficits. They entail no debt and impose zero obligation. They simply reflect net trade flows between nations. Truth be told, economists don’t think there’s any point in tallying trade “deficits.” What matters for our economic wellbeing isn’t net trade flows — it’s the total volume of trade and how easy it is to trade with foreigners. Trade, by definition, makes both sides richer. The more we trade, the better off we are — regardless of which direction that trade flows.
Sol Trujillo is correct: “Mass deportations sabotage the economy.” A slice:
No one wants to harbor violent criminals. But the Cato Institute obtained internal Department of Homeland Security data showing that 73% of those detained by Immigration and Customs Enforcement between Oct. 1 and Nov. 15 had no criminal conviction and only 5% had a violent-crime conviction.
Research from the Center for Migration Studies finds that the undocumented workforce in the U.S. is large and overwhelmingly employed across key sectors of the economy. Many of the 675,000 immigrants deported last year were working to build data centers, manufacturing plants, energy infrastructure and housing. Who will take their place when the U.S. has six million unfilled jobs?
Deportations impose costs on citizens too. The Peterson Institute for International Economics projected in 2024 that deporting 1.3 million workers could raise consumer prices by 1.5% within three years as labor shortages worsen. Deportations lead to the loss of jobs for citizens, according to the Hamilton Project. As the lack of workforce tamps down business growth, fewer U.S.-born workers are hired as a result. Consumption also declines: The Brookings Institute estimates that the U.S. lost between $40 billion and $60 billion in consumer spending in 2025 because of deportations. That, too, slows economic growth.
The cost also shows up in your tax bill. The ICE budget has risen from $9.99 billion in 2024 to a proposed $11.3 billion this year, and last year’s One Big Beautiful Bill Act gives ICE access to a $75 billion fund on top of discretionary funding available through 2029. Add to this lost tax revenue from immigrants themselves. A 2024 American Immigration Council report found undocumented-immigrant households paid more than $70 billion in federal, state and local taxes in 2022.
Tyler Cowen argues that “if you want to see whether immigration is making cities better or worse, just look at property values.” Here’s his conclusion:
If we consider the United States as a whole, the main magnets for immigrants, such as New York City, Los Angeles, and Miami, remain very pricey. Home prices have continued to do well in most of the country more broadly. Which suggests that, at the aggregate level, immigration is hardly tearing us apart.
If you do not believe that and you live in one of these places, then you should test your assumption: Will you put your money where your mouth is by selling your home as quickly as possible? I suspect that challenge will find few takers.
“So much for the ‘warmth of collectivism'” – so reports Jack Nicastro.
The Editorial Board of the Washington Post nails it:
The Trump presidency ought to be an education for progressives in the ways government overregulation can distort politics and business. For the latest example, see the spat between Stephen Colbert and his network, CBS, around the equal-time rule. The controversy might make for good ratings and fundraising appeals, but Congress could address the underlying issue simply by repealing the outdated regulation — or eliminating the Federal Communications Commission altogether.
Dan Klein applauds Adam Smith’s “anti-hegemist spirit of ’76.”
Someone should read to him “Lost, Not Stolen,” a 2022 report by eight conservatives (two former Republican senators, three former federal appellate judges, a former Republican solicitor general, and two Republican election law specialists). They examined all 187 counts in the 64 court challenges filed in multiple states by Trump and his supporters.
Twenty cases were dismissed before hearings on their merits, 14 were voluntarily dismissed by Trump and his supporters before hearings. Of the 30 that reached hearings on the merits, Trump’s side prevailed in only one, Pennsylvania, involving far too few votes to change the state’s result. Trump’s batting average? .016. In Arizona, the most exhaustively scrutinized state, a private firm selected by Trump’s advocates confirmed Trump’s loss, finding 99 additional Biden votes and 261 fewer Trump votes.
