The Arsos container ship is unloaded at the Port of Miami in Florida; Photo by Andrew Harrer/Bloomberg via Getty Images.
Marc Whitehead sends the follow-up question below after reading Paul’s thoughts on tariffs from early January: If we put a 15 percent tariff on all imported goods, how much money would that tax generate each year?
Question: Paul, I don’t think you are calculating 15 percent on all imports, only an increase on goods that are currently taxed. I believe that almost all imports are currently un-tariffed. What do you say?
Paul Solman: Good point, Marc. But it doesn’t much affect my withering conclusion in the post of Jan. 5: that wiping out the federal debt and “entitlement” obligations by hiking import duties (aka tariffs) is a non-starter.
After reading your question I went online, and have now seen estimates as high as 67 percent for the share of imports that’s tax-free. That might require a tripling of the numbers I estimated on Jan. 5. But even if we were to do so, the U.S. would still fall hundreds of billions of dollars short of covering our annual budget deficit with tariffs. Not to mention looming Social Security and Medicare shortfalls. To rid us of all our obligations? I stand by my recent bottom line: “we’re surely talking tariffs that would be many multiples of the price.”