US Tariff War / Even America's tariffs will not reduce our problems, the country has so much debt

Tariff collection reached a record level during the tenure of US President Donald Trump, which may soon reach $150 billion. By raising tariffs by 10% in April, $100 billion was earned in four months. However, experts believe that this is insufficient to reduce America's $36 trillion debt.

US Tariff War: Tariff collection has touched new heights in the second term of US President Donald Trump. The White House claims that tariff revenue has reached historic levels and could soon reach $150 billion. However, this huge income will not prove very effective in reducing America's economic crisis, especially the national debt of more than $36 trillion. Let us understand this issue in detail.

Tariff policy and its beginning

In April 2025, the Trump administration imposed a 10% tariff on almost all imported goods. Along with this, additional taxes were also imposed keeping in mind the trade deficit with some countries. The effect of this policy was immediate. In the first four months, tariffs earned about $100 billion, which is more than three times that of last year. Treasury officials estimate that this policy could generate more than $300 billion in annual revenue. Commerce Secretary Howard Lutnick told Fox Business that collection of up to $50 billion is possible on a monthly basis.

Where to use the tariff earnings?

The government can use this earnings to reduce its annual budget deficit of $1.3 trillion. Apart from this, there is talk that 'tariff rebate checks' can be given to American citizens, although Congress' approval will be necessary for this. According to the New York Times, Republican leaders hope that the amount received from the tariff will help reduce the deficit of $3.4 trillion. But this path is not as simple as it looks.

Why will tariffs not solve the problems?

The earnings from tariffs are impressive, but their long-term benefits are limited. According to a research by the Peterson Institute for International Economics (PIIE), tariffs can generate trillions of dollars in earnings over the next decade, but it comes with many challenges. For example, raising tariffs by 15% can generate income of $3.9 trillion, but if other countries impose retaliatory tariffs, this amount can come down to $1.5 trillion.

Apart from this, tariffs are also affecting American consumers. The prices of imported goods are rising, leading to an increase in inflation. Fed Chair Powell said that American importers and retailers are still bearing a large part of the cost of tariffs, but this burden is gradually being put on consumers. This can increase the risk of recession in the US economy.

The biggest challenge is America's national debt of more than $36 trillion. The income from tariffs is insufficient to reduce this huge debt. Experts believe that the tariff policy has been implemented on an arbitrary and emotional basis, which can have a negative impact on the global economy.