[Karupan]

Genuine questions: why are they calling it “reciprocal”? Is the US just matching the tariffs set by the other countries?

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.

[graeme]

Someone calculated the formula used. They divided the trade deficit of each country by total trade of each country and assumed that was all a tariff.

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.

[googlehater]

Thanks for pointing this out. As a follow up, if the US has a trade surplus, they seem to just slap 10% in both columns.

[tim333]

That's a bit of a messed up way to calculate things.

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.

[tootie]

It's just spin. The new duties are purely punitive.

[phorkyas82]

It's like the blaming in a playground fight; who started first? For context: https://nitter.net/KushDesai47/status/1907618136444067901

[ModernMech]

Because when the blowback comes, people will be looking to cast blame for starting this whole trade war, and when that time comes Trump will point to the word "reciprocal" and say "we didn't start this, we were only reciprocating".

[gjsman-1000]

> Is the US just matching the tariffs set by the other countries?

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.

[cldellow]

> If he's correct

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...

[f33d5173]

It's so quaint to me that people actually believe his rhetoric. How long do you think people will put up with high prices before they turn on him?

[rsynnott]

> If he's correct

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.