Tariffs Blocked, But America’s Debt Problem Remains

Feb 25
1 min read

A tariff is simply a tax on goods coming into the country. Tariffs make imports more expensive, and the theory is that people buy more American-made products since they are relatively cheaper.

The Trump administration used powers from the International Emergency Economic Powers Act in order to set tariffs on many imports.

Last week, the Supreme Court of the United States said the president had no authority to do so.

The bigger issue isn't tariffs however, it's debt.

The Congressional Budget Office estimates that the U.S. will borrow around $25 trillion in the next 10 years. What's striking is that debt is already much larger than the economy, and the gap is expected to widen further.

Tariffs were projected to raise between $1 trillion and $3 trillion over 10 years. That's a big number, but it doesn't even compare to the $25 trillion figure.

While this is all happening, spending on the following is increasing:

Social Security
Medicare
Medicaid
Interest payments

The reality is that eventually those areas will catch up to government revenue and eat up every last bit.

Court rulings can make as many headlines as they want, but it doesn't change the math. With or without tariffs, the big challenge is going to be dealing with the immense growth in spending.

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